MarketsForex.com - forex markets review

U.S. Dollar Trading (USD) in a heavy data-day the FOMC decided to keep interest rates unchanged (5.25%). As much as the market expected the decision, it was accompanying statements by Fed officials indicating that inflationary pressures are receding that caused most interest with the likelihood of future rate cuts increasing. As a result the USD fell against all other majors on Wednesday. The Chicago PMI also released on Wednesday came in weaker than expected at 48.8 rather than the forecasted 52 and the previous 51.6. Although the dollar had been bolstered earlier in the session by a strong forecast of U.S. economic growth in the last three months of 2006, the USD dipped following the Chicago PMI indicating Midwest business activity was at its lowest since April 2003. In related news, the GDP (Q4) came out stronger than expected at 3.5% with economists predicting 3% growth; the previous quarter saw a rise of 2%. In other markets the NASDAQ was up 15.29 points (0.62%) and the Dow Jones was also up 98.38 points (0.79%) as investors were encouraged by the FOMC interest rate decision. Crude Oil rose by US$1.01 to US$57.98 a barrel. Looking ahead, release of key economic data out of the US continues to be the trend with ISM manufacturing for the month of January being made public. Market expectations are at 51.9 higher than the previous 51.4. Furthermore, Core PCE is scheduled for release out of the US where the previous saw a 2.2% rise.         

The Euro (EUR) climbed above the psychologically important level of 1.3000 on the back of weaker-than-expected reading on U.S. Midwest business activity, which spurred a bout a profit-taking ahead of the Federal Reserve policy meeting outcome. Yet reports are suggesting that the exchange rate of the Euro against the Yen is more of a concern then that of the Euro against the Dollar according to German Economy Minister Michael Glos. European officials have expressed concern recently that the Japanese currency’s weakness against the Euro gives exporters in Japan an unfair advantage over their Euro region rivals, in particular Germany’ key auto sector. Overall, the EURUSD traded within a low of 1.2927 and a high of 1.3020 before closing the day at 1.3029 in the New York session. Looking ahead, Manufacturing PMI is scheduled for release out of the Eurozone with markets expecting a figure of 56.3 down on the previous 56.5.

The Japanese Yen (JPY) strengthened sharply yesterday following reports U.S. Treasury Secretary Henry Paulson said he is watching the value of the currency “very, very closely,” a week before a meeting of the G7 rich nations where yen weakness is expected to be discussed. Paulson added that the Yen’s current value reflected low interest rates and a still-sluggish Japanese economy. The comments saw investors loosen bets against further weakness of the Yen. Overall the Yen traded within a range of a low 120.62 and a high of 121.75 before closing at 120.71 in the New York session near day lows.

The Sterling (GBP) experienced a volatile day of trading reaching lows of 1.9484 and a high of 1.9669 before closing at 1.9638 during the New York session. The fall below the $1.95 was driven down by profit-taking from recent multi-year highs, ahead of month end and stronger than expected U.S. growth data. With officials declaring the drop was consistent with view that the Sterling over-appreciated following the BoE rate hike in January.    

The Australian Dollar (AUD) rose against the USD, trading with a low of 0.7698 to high of 0.7767 before closing at 0.7758 in the New York session (near day highs).

Gold (XAU) rose in response to a weaker US dollar by US$2.90 an ounce to US$653.10 an ounce.
 

Technical Commentary

Euro 1.3030
Initial support at 1.2925 (Jan 31 low) followed by 1.2876 (Jan 26 low). Initial resistance is now located at 1.3045 (Jan 23 high) followed by 1.3054 (Jan 9 high and 38.2% of 1.3368 to 1.2865)

Yen 120.70
Initial support is located at 120.63 (Jan 31 low) followed by 120.19 (Jan 25 low). Initial resistance is now at 122.20 (Jan 29 trend high) followed by 122.38 (61.8% retracement of the 135.18 to 101.67 decline)

Pound – 1.9645
Initial support at 1.9482 (Jan 31 corrective low) followed by 1.9417 (76.4% retracement of the 1.9262 to 1.997 advance). Initial resistance is now at 1.9637 (Jan 31high) followed by 1.9733 (50% retracement 1.9917 to 1.9549 & approx. Jan 25 high)

Australian Dollar – 0.7755
Initial support at 0.7698 (50% retracement of the 0.7414 -0.7982 rally) followed by 0.7631 (61.8% retracement of the .7414 – 0.7982 rally). Initial resistance is now at 0.7790 (38.2% retracement of the 0.7940 to 0.7697 decline) followed by 0.7821 (Jan 25 high).

Gold – 652.75
Initial support at 641.10 (Jan 26 low) followed by 639.25 (Jan 24 corrective low). Initial resistance is now at 654.60 (Jan 25 high) followed by 656.20 (Aug2, 2006 reaction high)

Visit Easy-Forex for the latest market rates and information, Start trading for as little as $25

Technorati tags: Forex

U.S. Dollar Trading (USD) remained steady with majors trading in tight ranges as investors await the FOMC decision on interest rates. The dollar received little support from a US consumer confidence index that was in-line with expectations. In other markets the NASDAQ was up 7.55 points (0.31%) whilst Dow Jones was also up 32.53 points (0.26%) With colder weather encompassing the US, Crude Oil rose by US$2.83 (5.24%) to US$56.88 a barrel. Looking ahead, in a data-heavy day for the US plenty of interest surrounds the FOMC interest rate decision with market expecting unchanged rates at 5.25%. Markets will focus on statements that accompany the Fed decision to see what it suggests for future rates moves. In related news, GDP (Q4) is also scheduled for release with market reports suggesting an increase of 3.0% higher than the previous 2.0%. Other key data out of the US will be in the form of the Chicago PMI with expectations being at 52.0 higher than the previous 51.6.    

The Euro (EUR) remained steady against the US despite German CPI data coming in worse than expected at 1.6% lower than the expected 2.1% and higher than the previous 1.4%. This was largely due to markets awaiting the FOMC interest rate decision. The EURUSD traded within a low of 1.2942 and a high of 1.2982 before closing at 1.2961in the New York session. Looking ahead key data is due for release in the form of the Unemployment Rate (Dec) with the market expecting 7.6% (unchanged). In other news the CPI flash estimate for the month of January is also made public where reports are insinuating a 2.10% figure, higher than the previous 1.90%.

The Japanese Yen (JPY) continues to experience weak economic data with the Unemployment Rate rising to 4.1% in December from an eight year low of 4.0% for the month of November. Overall household spending in Japan fell by -1.9%, lower than the market expectation of a -1.2% decline. On a positive note, industrial production rose to 0.7% better than the expected 0.3% largely due to a weakening JPY. In other news, the yen rose sharply against the Euro after German Finance Minister Peer Steinbrueck said the Euro-Yen exchange rate will be discussed at next week’s meeting of the G7 nations. The USDJPY remained steady in expectation of the FOMC statement trading within a narrow range, reaching a low of 121.47 and a high of 122.20 before closing at 121.62 in the New York Session. Looking ahead, key data continues to be released from Japan in the form of Manufacturing PMI with the previous index being at 53.1. UPDATE: Manufacturing PMI at 53.4 higher than the expected 53.1

The Sterling (GBP) rose against the dollar as investors focused on possible inflows from corporate takeover activity and strong British economic fundamentals. Mortgage approvals experienced the weakest rise since April 2006 holding a less than expected impact on the market. Overall, the GBPUSD traded with a low of 1.9595 and a high of 1.9697 before closing at 1.9613 in the New York session.

The Australian Dollar (AUD) remained steady trading with a low of 0.7703 and a high of 0.7737 before closing the day at 0.7720 in the New York session.

Gold (XAU) rose inline with the hike in oil prices, climbing by US$ 2.30 an ounce to US$645.50. 

 Technical Commentary

Euro 1.2960
Initial support at 1.2876 (Jan 26 low) followed by 1.2865 (Jan 12 reaction low). Initial resistance is now located at 1.3054 (Jan 9 high and 38.2% of 1.3368 to 1.2865) followed by 1.3117 (50% retracement of the 1.3368 to 1.2865 decline).

Yen 121.65
Initial support is located at 121.21 (Jan 26 low) followed by 120.19 (Jan 25 low). Initial resistance is now at 122.38 (61.8% retracement of the 135.18 to 101.67 decline) followed by 122.88 (Dec 13, 2002 high)

Pound – 1.9615
Initial support at 1.9549 (Jan 29 low) followed by 1.9512 (61.8% retracement of the 1.9262 to 1.9917 advance). Initial resistance is now at 1.9733 (50% retracement 1.9917 to 1.9549 & approx. Jan 25 high) followed by 1.9833 (Jan 24 high & approx. 61.8% retracement of 1.9917 to 1.9549)

Australian Dollar – 0.7720
Initial support at 0.7698 (50% retracement of the 0.7414 -0.7982 rally) followed by 0.7631 (61.8% retracement of the .7414 – 0.7982 rally). Initial resistance is now at 0.7753 (Jan 26 high) followed by 0.7821 (Jan 25 high).

Gold – 647.65
Initial support at 641.10 (Jan 26 low) followed by 639.25 (Jan 24 corrective low). Initial resistance is now at 654.60 (Jan 25 high) followed by 656.20 (Aug2, 2006 reaction high)

Visit Easy-Forex for the latest market rates and information, Start trading for as little as $25

Technorati tags: Forex

U.S. Dollar Trading (USD) overall traded within a narrow range against all other majors in the overnight forex session. US PPI came in stronger than the expected 0.5%, actual was at 0.9%. The Feds Beige Book was consistent with recent data; economy growing and prices to rise steadily, labour markets tightening. Manufacturing indications are good apart from auto and housing. With the market expecting the Fed to keep interest rates steady, rates are expected to remain unchanged at 5.25% at the Federal reserve’s January and March meetings. In other markets, the Dow Jones index dropped 5pts and the NASDAQ fell by 18pts. Blue chip stocks remained steady whereas technology shares showed significant decline as Intel shares dropped 5.65%. In other news crude oil rallied from a 20 month low overnight ending US$1.00 higher at US$52.21 a barrel. Looking ahead CPI and Housing Starts are set to be released later on today.

The Euro (EUR) traded within a low of 1.2898 and a high of 1.2949, before closing at 1.2938 during the New York Session. On the data front, the Euro Zone Trade Balance was released at 3.1 billion significantly higher than that of the estimated 2 billion. Whilst the CPI was also released with the result being an increase of 0.4% as expected.

The Japanese Yen (JPY) traded within a low of 120.36 and a high of 120.86 versus the dollar, before closing at 120.66 in the New York session. Looking ahead, the market eagerly awaits the decision on interest rates, with the monthly release of the BoJ. As the market’s expectations are mixed as to whether the BoJ will hike rates or keep them on hold, as seen by the USD/JPY trading within a significantly narrow range yesterday.

The Sterling (GBP) traded within a low of 1.9605 and a high of 1.9722, before closing at 1.9697 in the New York session. Overall, the GBP traded up 0.4% against the USD. On the data front, unemployment rate were released, unchanged at 5.5%.

The Australian Dollar (AUD) traded within a low of 0.7818 and a high of 0.7871, before closing at 0.7866 in the New York session.

Gold (XAU) rose by US$7.30 to US$633.20 an ounce in response to the rise in commodities in particular, oil. As well as better than expected producer prices in the US is the market perceives as fuelling inflationary pressures in the future.
 

  Technical Commentary

Euro 1.2940
Initial support at 1.2865 (Jan 12 low) followed by 1.2821 (61.8% retracement of the 1.2483 to 1.3368 advance). Initial resistance is now located at 1.2990 (Jan 16 reaction high) followed by 1.3016 (Jan 11 high).

Yen 120.65
Initial support is located at 119.7 (Former resistance from Jan 3) followed by 119.14 (Jan 10 low). Initial resistance is now at 120.89 (Jan 17 trend high) followed by 121.41 (Dec 5, 2005 high).

Pound – 1.9705
Initial support at 1.9571 (Jan 15 low) followed by 1.9426 (Jan 12 low). Initial resistance is now at 1.9725 (Jan 17 high) followed by 1.9753 (Jan 3 reaction high).

Australian Dollar – 0.7875
Initial support at 0.7759 (Jan 10 low) followed by 0.7732 (Nov 24, 2006 low). Initial resistance is now at 0.7874 (Jan 17 high) followed by 0.7897 (61.8% retracement of the 0.7982-0.7759 decline).

Gold – 633.00
Initial support at 620.17 (Jan 17 low) followed by 610.00 (Jan 12 low). Initial resistance is now at 634.14 (Jan 17 high) followed by 645.0 (Jan 3 reaction high).

Visit Easy-Forex for the latest market rates and information, Start trading for as little as $25

Technorati tags: Forex

U.S. Dollar Trading (USD) while initially weaker rallied against the majors in the overnight forex session despite poor NY manufacturing index and stronger Eurozone data as investors sought to take profits ahead of market moving data this week. The New York Empire State manufacturing index fell from 22.19 to 9.13 in January from an expected level of 20. In other markets, the Dow Jones index climbed 26pts and the NASDAQ fell by 5pts as earnings on blue chip stocks were expected to post good results, however, the drop in crude overnight capped any broad gains as energy stocks plummeted. Crude oil fell US$1.77 to US$51.22 a barrel as Saudi Arabia said there was no need for an emergency OPEC meeting and that current output cuts were working well. Looking ahead, PPI, industrial production, and the Beige book are due out tonight.

The Euro (EUR) traded within a low of 1.2909 and a high of 1.2988, before closing at 1.2922 in the New York session. On the data front, the German ZEW index came in at -3.6 from a -10 estimate. Looking ahead, Eurozone CPI is due out today.

The Japanese Yen (JPY) traded within a low of 120.24 and a high of 120.75 versus the dollar, before closing at 120.60 in the New York session. On the data front, Japanese news agency Kyodo reported the BoJ may not increase interest rates tomorrow citing “sources familiar with the matter”. Current account data showed a surplus increase of 25.5% where the market was expecting 33.6%. Looking ahead, the BoJ announces its interest rate decision tomorrow.

The Sterling (GBP) traded within a low of 1.9592 and a high of 1.9705, before closing at 1.9624 in the New York session. On the data front, UK CPI for December came in at 0.6% from a 0.4% estimate. Looking ahead, unemployment is due out today.

The Australian Dollar (AUD) traded within a low of 0.7823 and a high of 0.7853, before closing at 0.7834 in the New York session.

Gold (XAU) fell by US$1.40 to US$625.50 an ounce in response to weaker oil.
 

 Technical Commentary

Euro 1.2920
Initial support at 1.2865 (Jan 12 low) followed by 1.2821 (61.8% retracement of the 1.2483 to 1.3368 advance). Initial resistance is now located at 1.3016 (Jan 11 reaction high) followed by 1.3054 (Jan 9 high and key intraday resistance).

Yen 120.85
Initial support is located at 119.7 (Former resistance from Jan 3) followed by 119.14 (Jan 10 low). Initial resistance is now at 120.78 (Jan 16 trend high) followed by 121.07 (Dec 12, 2005 high).

Pound – 1.9610
Initial support at 1.9571 (Jan 15 low) followed by 1.9426 (Jan 12 low). Initial resistance is now at 1.971 (76.4% retracement of the 1.9849-1.9261 decline) followed by 1.9753 (Jan 3 reaction high).

Australian Dollar – 0.7825
Initial support at 0.7759 (Jan 10 low) followed by 0.7732 (Nov 24, 2006 low). Initial resistance is now at 0.7871 (50% retracement of the 0.7982-0.7759 decline) followed by 0.7897 (61.8% retracement of the 0.7982-0.7759 decline).

Gold – 625
Initial support at 610.0 (Jan 12 low) followed by 602.2 (Jan 5 corrective low). Initial resistance is now at 628.38 (Jan 16 high) followed by 645.0 (Jan 3 reaction high).

Visit Easy-Forex for the latest market rates and information, Start trading for as little as $25

Technorati tags: Forex

U.S. Dollar Trading (USD) was largely range bound due to US market being closed for Martin Luther King Day, tight ranges could be set to continue for the next day with no key data releases scheduled until Wednesday. The New York Federal Reserve manufacturing index will be released with expectations centered on 20.00. In other markets, the Crude Oil prices were little changed due to the US Holiday. Crude Oil fell by US24c to US$52.75 a barrel. There were further comments by the Kuwaiti Oil Minister who said that OPEC could hold an emergency meeting if oil prices fell further, however they would prefer to wait until the scheduled meeting on Feb 1st.  

The Euro (EUR) traded within a range of 1.2915 to 1.2957, before closing at 1.2937 in the New York session. Looking ahead the market awaits the key data release of the German ZEW survey. The market expects a release of approximately -10.0.

The Japanese Yen (JPY) traded within a range of 120.07 to 120.61, before closing at 120.43 in the New York session. Expect this range to continue ahead of the BoJ monetary policy meeting scheduled for Wednesday with the market divided on whether interest rates will rise as a result.

The Sterling (GBP) continued to hold on to its recent gains, trading within a range of 1.9571 to 1.9669, before closing at 1.9648 in the New York session. Data continues to be positive with the UK PPI coming in at above expectations. Focus will now turn to the UK CPI due to be released later today. The market is looking for 0.4% increase on a monthly basis, taking the annual rate to 2.7%.  

The Australian Dollar (AUD) traded within a range of 0.7831 to 0.7860, before closing at 0.7836 in the New York session.

Gold (XAU) largely unchanged trading in a range of 625.10 to 628.25.

 Technical Commentary

Euro 1.2935
Initial support at 1.2865 (Jan 12 low) followed by 1.2821 (61.8% retracement of the 1.2483 to 1.3368 advance). Initial resistance is now located at 1.3016 (Jan 11 reaction high) followed by 1.3054 (Jan 9 high and key intraday resistance).

Yen 120.40
Initial support is located at 119.70 (Former resistance from Jan 3rd) followed by 119.14 (Jan 10 low). Initial resistance is now at 120.74 (Jan 12 trend high) followed by 121.07 (Dec 12, 2005 high).

Pound – 1.9625
Initial support at 1.9426 (Jan 12 low) followed by 1.9316 (Jan 10 corrective low). Initial resistance is now at 1.9753 (Jan 3 reaction high) followed by 1.9849 (Dec 1st 2006 high).

Australian Dollar – 0.7825
Initial support at 0.7759 (Jan 10 low) followed by 0.7732 (Nov 24, 2006 low). Initial resistance is now at 0.7871 (50% retracement of the 0.7982-0.7759 decline) followed by 0.7897 (61.8% retracement of the 0.7982-0.7759 decline).

Gold – 627
Initial support at 610.0 (Jan 12 low) followed by 602.2 (Jan 5 corrective low). Initial resistance is now at 627.7 (Jan 12 high) followed by 645.0 (Jan 3 reaction high).

Visit Easy-Forex for the latest market rates and information, Start trading for as little as $25

Technorati tags: Forex