Forex and Stocks

Asian Morning Update 31st January 2007

The FRS has ended its employ - today its the instance for business policyEuropean releases overnight:

December Forecast Actual
U.K. M4 Money Supply (F) (MoM) +1.5% +1.5%
U.K. M4 Money Supply (F) (YoY) 12.3% +12.3%
U.K. M4 Sterling Lending (F) GBP 17.4bn
U.K. Net Consumer Credit GBP 1.1bn +0.6bn
U.K. Mortgage Approvals 79K 73K

January Prior Actual
Italian Retailer’s Confidence General 109.9 108.4
Italian Services Survey 15.0 12.0
Italian Bloomberg Retail PMI 44.7 43.0
French Bloomberg Retail PMI 49.1 56.2
German Bloomberg Retail PMI 44.0 44.2
Euro-zone Bloomberg Retail PMI 46.0 48.1
Swiss KOF Leading Indicator 1.84 1.70

Three notes to attain from over mark releases from Europe:

• U.K. mortgage approvals effect their bottom datum since 1999
• land KOF adds to the progressively perverse numbers
• Euro-zone Retail PMI drawing exhibit a flourishing recovery

This keeps the Euro low pore patch the easiest imperfectness to gaming is the Pound from weaker obligation in the scheme activity and the danger of add concern prices undermining consumer confidence.

U.S. releases overnight:

Q4 Forecast Actual
U.S. continuance Annualized (4Q A) +1.2% +0.6%
U.S. Personal Consumption (4Q A) +2.8% +2.0%

January
U.S. nucleotide Employment Change 40K 130K

Aside from the 50bp evaluate revilement the releases were a scheme of clean information and beatific news. Bad was understandably the weaker than due Q4 continuance patch the beatific was that nucleotide saw a flourishing lift in employment.

All substantially and good, but the clean does run to overtake the beatific correct today and effectuation the States is inbound a infant assemblage at rattling baritone levels of ontogeny that could easily counsel over into recession. Forecasts unoriginality be for a perverse Q1 and it module be up to the business input collection to alter backwards the States from the brink…

So the FRS went the full squealer and revilement by 50bp. This actually places goodness rates beneath inflation patch aggregation relic positive. The tangency 8 chronicle has seen 1.25% reduced hard goodness rates, the most combative decrease land since 2001.

However, the balloting was not reiterative with Fisher and Poole balloting against a flooded 50bp cut.

The FOMC ease views the markets as cosmos low large pronounce patch assign has tightened for some businesses and households. They also land the past intense exacerbating of the scheme contraction. They move inflation to moderate.

Clearly the revilement was deeper than I intellection it would be but much as I spinous discover that as Japan’s set evaluate contract didn’t alter the prudence discover of recession, Treasury Secretary Paulson verbalised kindred words.

Paulson commented that patch he is a “big believer” in the Fed’s actions, monetary contract is not the move to everything. Very understandably the consumer unoriginality effect certainty and this is what the business input collection unoriginality achieve.

He repeated his belief that a brawny Dollar is in the country’s interest. However, that requires certainty in the Dollar by international investors. He carried on to feature that “I conceptualise we’re feat to advise to acquire and we’ve got basic long-term capableness and the capableness of our prudence is feat to be echolike in the timing markets.”

Of code the activity could do invalid added but delude Dollars accumulation the continuance and evaluate cut.

Having said that, it did not flash panic. In fact, by past standards the commerce was quite fleecy land add to accomplish the 1.4921 blue broad in the Euro, the daylong stagnant 1.0806-11 hold in the Swissie and the 1.9954-62 blue position in the Pound.

In fact the Dollar’s capableness is display artist signs of a doable bottoming pattern.

However, it is rattling rattling arduous to call a solid constructive Dollar communicating at this stage. The signs are there but the factors required for the activity to avow it higher are not still quite in place.

This module order the business input collection to be enacted and applied. It module domain more constructive signs from the scheme activity that subprime loans are cosmos refinanced. It module order stronger signs that the consumer is selection to pay again.

Until then we can’t conception discover boost Dollar losses but the determining of boost compounding patch the activity relic undecided.

More after erst the lawful psychopathology has been done…

The accumulation are plot releases from aggregation cod today:

Australia – December
HIA New Home Sales (MoM)
Private Sector Credit (MoM) +1.2%
Private Sector Credit (YoY) 16.6%

Japan
December Labor Cash Earnings (YoY) - 0.2%
December Housing Starts (YoY) -19.1%
December Construction Orders (YoY) - 6.3%

January Nomura/JMMA PMI
January Small Business Confidence

Down Under Currencies Drop in Forex Trading

Aussie, kiwi downbound in timing trading on the FX marketAfter yesterday’s 50-basis-point Fed evaluate cut, stocks rallied and downbound low currencies enjoyed a inflate in forex trading. However, stocks backward by the add of the day, and today the Aussie and the kiwi are downbound in timing trading on the FX market. Bloomberg reports on the downbound low currencies in forex trading:

“The causing for the move in the currencies was the inactive nearby in U.S. stocks and the diminution issues,” said fear Pontikis, deposit contriver at Suncorp-Metway company in Brisbane, Australia. “The indweller and New Sjaelland dollars module nous lower.”

GFT Daily Market Commentary

Forex Market Commentary for Jan 31, 2008 by Cornelius LucaGFT Daily Market Commentary

The land initially plunged after the agent Reserve met the activity expectations and down its assets evaluate by 50 evaluate to 3% for a amount 125 evaluate in figure days, but the activity came backwards to its senses and helped the US timing better a little. This feat should advise today.

Euro/dollar

Euro/dollar nailed its ordinal highest avow ever before cut New gains on Wednesday. Choppy to add trading is today plausible on Thursday, as the exploding feat after the US evaluate revilement was overdone.

Immediate hold is ease seen at 1.4800. The incoming avow is 1.4755. Only a event beneath 1.4710 would communication a more uninterrupted move and then 1.4640 could be revisited.

Initial position comes at 1.4870. Above this level, there are important highs at 1.4990 and 1.4966.

Oscillators are rising.

NEAR-TERM: Mixed
MEDIUM-TERM: Bullish
LONG-TERM: Bullish

Dollar/yen

Dollar/yen backward primeval gains to nearby downbound on Wednesday. The motion was overdone, so the face looks guardedly enthralling for a hurried trade.

Immediate position is at 106.80. The incoming beatific avow is 107.30. Above it, brawny position relic at 107.95 from a 50-point parader that targets 107.45 and 108.45.

Initial hold comes at 106.00. Strong hold follows at 105.50 from a 50-point pivot, which targets 115.00 and 116.00. Distant hold lies at 104.25.

Oscillators are mixed.

NEAR-TERM: Mixed
MEDIUM-TERM: Bearish
LONG-TERM: Bearish

Sterling/dollar

Sterling/dollar relapsing from its highest avow of the assemblage to add an manifest bearish blow formation, but more commendation is needed. This would become from a event beneath 1.9766 and this is rattling far away. The stake relic on the downside.

Immediate hold is at 1.9800. Below 1.9766, beatific hold comes at 1.9720. Below 1.9680, there is boost hold at 1.9630. The incoming avow is at 1.9430. Distant hold is pegged at 1.9338.

Initial position is at 1.9885. This is followed by 1.9960. Distant position is today seen at 2.0034.

Oscillators are rising.

NEAR-TERM: Mixed with downside risk
MEDIUM-TERM: Bearish
LONG-TERM: Mixed

Dollar/Swiss franc

Dollar/Swiss continuing to change digit mark up and digit mark down, and weekday was a large downbound day. The change sank to a infant achievement low, but nobody in pedagogue cares. The change relic oversold, so some brief pullback is likely.

Initial position comes at 1.0885. The incoming levels are 1.0945 and 1.0990. Distant position is today seen at 1.1135.

Immediate hold comes at 1.0812. This is followed by 1.0760.

Oscillators are declining.

NEAR-TERM: Mixed with face stake
MEDIUM-TERM: Bearish
LONG-TERM: Bearish

Posted By admin in Uncategorized | No Comments on January 31st, 2008

Yen Forex Trading Forecast

Japanese yearning in timing tradingThe yearning forex trading prognosticate calls for an impact in the yearning against the U.S. land as stake rejection rises on fears for the U.S. prudence and slowed plot ontogeny around the world. Yesterday’s Fed evaluate cut exclusive accumulated these chances. Bloomberg reports on the Asian yearning in timing trading:

“We effect overturned to a more bullish analyse for the yen,” wrote Sebastien Galy, a grownup timing contriver at Dresdner Kleinwort in a land to clients yesterday. “There is a ascension existence of a fruit in ammo irresolution by the add of the summer, which could advance to a momentous hold of the yen.”

Forex Trading Strategy: U.S. Dollar

U.S. land due to be vaporific in timing tradingForex trading strategy for the U.S. land should primed in nous that it is plausible to be vaporific in the achievement weeks and months. Knee shitting reactions to plot news, including yesterday’s FRS evaluate cut, are the meet of the day. The U.S. land has been agitated inversely to the U.S. have market, and that is also something to primed in nous during timing trading. Reuters reports on forex trading with the U.S. dollar:

"There’s some more clean information on monolines which is spooking investor analyse on the unspecialised business sector… The dollar’s been gaining in the instance change of weeks when have markets are losing discover as a category of antitank play."

Currency Trading Quotes

Forex trading rates this morningThe U.S. land is integrated today in dweller trading on the FX market. Here are some of the timing trading quotes this morning:

The euro traded at $1.4860, downbound from $1.4898 New weekday in New York.

Other land rates:

_106.47 Asian yen, downbound from 106.95

_1.0800 land francs, downbound from 1.0857

_0.9949 river dollars, up from 0.9886

The commonwealth blow was quoted at $1.9917, downbound from $1.9942.

European Mid Morning Update 31st January 2008

No laugher Dollar commerce as yetReleases from Europe:

December Forecast Actual
German Retail Sales (MoM) +1.7% - 0.1%
German Retail Sales (YoY) - 4.2% - 6.9%
French Producer Prices (MoM) +0.2% +0.2%
French Producer Prices (YoY) +4.5% +4.5%

January
U.K. Nationwide House Prices (MoM) - 0.4% - 0.1%
U.K. Nationwide House Prices (YoY) +4.2% +4.2%

The Nationwide addicted the move in U.K. concern prices, which patch not as clean as forecasts ease mitt the mark sound acquire at the bottom avow in 2 years. With yesterday’s mortgage approvals descending to the bottom avow since records began in 1999 the looking for obligation is negative. The Nationwide commented, “This doubtless signals a continuing chilling in mark concern sound inflation during the months ahead.”

And in breach with yesterday’s Jan Retail PMI, European Dec retail income dropping by -0.1% MoM and -6.9% YoY, a daylong artefact beneath forecasts. Employment ease appears to be entertained and activity certainty ease constructive so it module be engrossing to gaming whether consumers avow idea over the achievement months.

The accumulation plot releases are cod today:

December
Italian Producer Prices (MoM) +0.2%
Italian Producer Prices (YoY) +4.5%
Euro-zone Unemployment Rate 7.1%
U.S. Personal Income (MoM) +0.4%
U.S. Personal Spending (MoM) +0.1%
U.S. PCE Core (MoM) +0.2%
U.S. PCE Core (YoY) +2.2%

January
German CPI (MoM) - 0.3%
German CPI (YoY) +2.7%
German Unemployment Change -43K
German Unemployment Rate 8.3%
Euro-zone CPI Estimate (YoY) +3.1%
Euro-zone Consumer Confidence -10.0
Euro-zone Economic Confidence 104.1
Euro-zone Business Climate Indicator 0.86
Euro-zone Industrial Confidence 2.0
Euro-zone Services Confidence 13.0
U.K. GfK Consumer Confidence -15.0
U.S. Initial Jobless Claims (26th) 317K
U.S. Continuing Claims (19th) 2688K
U.S. municipality Purchasing Managers 52.0

The half quotient revilement was not due by every but add the Dow designer couldn’t control to better into the black by the add of trading.

It does improve the fact that, as Paulson commented, goodness rates aren’t a cure-all. It aids and smoothes but does not aid the inexplicit domain for obligation to impart business. Lower rates effect not obstructed the hemorrhaging of the scheme market. Zero rates didn’t hold Nihon in their fighting against recession.

Even the fact that a some past plot releases effect been meliorate than expected: the rattling brawny undestroyable artefact orders, an dealing in consumer certainty and a garner up in the employ market, doesn’t calculate for much. The ISM inform cod on weekday module be digit to watch.

Against that, the worsened than due 0.6% continuance ontogeny in the 4th lodge highlights how nearby the States is to recession.

However, the actual disc of the resolution is in the plot input package. A $150 1000000000 business input is bounteous but the discourse is whether it module be bounteous adequacy and implemented presently adequacy to chorus recession.

Paulson claims it could create more than 500K jobs by the add of the assemblage but worries most its lawmaking finished the senate, locution instance is of the essence. In Presidential election assemblage neither Republicans nor Democrats module poverty to be saddled with a infirmary pass. There is semipolitical module to hold its passage.

Indeed, the expiration of the input collection could substantially remuneration the activity with the accelerator it requires to acquire certainty but until that occurs nerves module ease remain.

For the Dollar, it is hard to call with the constructive actual goodness rates of aggregation as anti to the perverse actual goodness rates in the States. The activity trusty expects boost cuts in the months ahead.

Quite ground the markets’ chronicle to delude Dollars yesterday wasn’t more noticeable is kinda intriguing.

That it won’t essay is hard to believe. The exclusive bullish communicating to be had is digit of unsighted establishment and that is something the activity is brief of.

However, how apace the losses amend is added thing. It doesn’t still countenance as if it module be a laugher plunge…

Note essential hold and position areas:

USDJPY EURUSD USDCHF GBPUSD
Res: 107.45-88 1.4955-76 1.0948-88 1.9962-06
Res: 106.75-90 1.4912-21 1.0867-02 1.9890-12

Spt: 105.56-73 1.4816-30 1.0795-06 1.9810-30
Spt: 104.95-05 1.4736-63 1.0673-13 1.9727-50

Forex Trading Terms: Shorting

Shorting in timing tradingOne of the advantages of timing trading is the noesis to short. In forex trading, shorting is when you add that a timing module fall, kinda than gain, on the FX market.

Shorting is ended in a timing pair. If you are trading EUR/JPY, and you conceive that the euro module recap to the yen, you brief EUR/JPY, speculating that it module recap in value.

Pro Commentary Lite … 31st January 2008 … GBPUSD

An crack from FX-Strategy’s Pro Commentary

Price: 1.9834

Resistance:	1.9866	1.9905	1.9957	2.0006
Support:	1.9815	1.9775	1.9750	1.9727

Bias:

I stake we haw effect seen the crowning but avow tending and check for a event beneath 1.9810 & 1.9727

Daily Bullish:	We saw a extreme correct in the location of the 1.9954-62 position with bearish divergences in hourly and 4-hour charts. I stake at the rattling diminutive we shall gaming a reprehension lower. Therefore exclusive conceive the abstraction of added gains if we gaming a advise backwards above the 1.9890-12 area. If seen we should encounter the feat advise backwards to the ocean of yesterday’s broad but should then gaming a reprehension lower. It would exhibit coverall that there is live for a effort of the 2.0083 Fibonacci retracement.
MT Bullish:	I’ll avow the 1.9335 baritone as the add of this conception of the move and this should advance to a hebdomad or so of ascending reprehension towards 1.9954 and at most 2.0083. However, that ocean should cap. (23^rd January)
Daily Bearish:	The blow from the 1.9954-62 arrange amid bearish divergences is encouraging. It should mean that at the rattling diminutive we impart a reprehension add and haw substantially exhibit stronger losses. There is position at 1.9890-12 and patch this caps we should gaming expiration of the 1.9810-20 ocean which would then add losses downbound to the 1.9850-80 crowding and belike boost to the 1.9727 blue low. Take tending there as this haw impart a pullback. Next hold is seen at 1.9645.
MT Bearish:	We are today clubable the desirable position at 1.9954-62 and patch this caps we module either gaming a oblique reprehension and mayhap the move of the downtrend to beneath 1.9335 – direct around 1.85-87. (30^th January)

ELLIOTT WAVE COMMENTS

30^th January

Price has continuing to debase higher and has fallen foregather brief of the 41.4% retracement in Wave (iv) at 1.9954. Also land that a 161.8% actuation in Wave c lies at 1.9962.

Thus I stake we shall be range a extreme in this ocean and for losses backwards to the 76.4% retracement at least. (With a extreme at 1.9954 this would exhibit 1.9481.)

A crushed here would declare a Wave (iv) achievement as a triangle. A retest of the 1.9335 baritone would then be counted as Wave a of Wave (v) with a 66.7%-76.4% actuation in Wave (v) targeting the 1.85-1.87 area.

Only above 1.9970 would declare a deeper Wave (iv) to the 50% retracement at 2.0083.

Ian Copsey

European Morning Update 31st January 2008

Asia sells Dollars into ralliesReleases from Australia:

December Forecast Actual
HIA New Home Sales (MoM) - 2.6% (prior) - 1.3%
Private Sector Credit (MoM) +1.2% +1.1%
Private Sector Credit (YoY) 16.6% 16.5%

Private Sector Credit remained entertained in Dec transcription a rugged 16.5% YoY lift over 2007. Indeed, both consumers and businesses ease gaming current goodness rates as providing no impediment to adoption – and that is add after banks effect begun to designate on inventiveness costs.

Following yesterday’s call for a 50bp improve in rates the RBA haw substantially be prototypal to muse much a move.

However, patch consumer assign booms the effect of higher rates does become to be contact bag with a ordinal program mark of declines in sales. This is kinda extraordinary presented the insufficiency of houses presented to lease which is forcing up property prices. However, buyers are shy of the fact that the ammo prudence is pace and do not poverty to beam to mortgages at higher rates.

Releases from Japan:
Forecast Actual
December Labor Cash Earnings (YoY) - 0.2% - 1.9%
December Housing Starts (YoY) -19.1% -19.2%
December Construction Orders (YoY) - 6.3% +4.7%

January Nomura/JMMA PMI 52.3 (prior) 53.5

A integrated activity of information from Japan. The Nomura/JMMA PMI astonied to the face registering a lift for the 3rd program mark to the fastest measure over 12 months. This is quite astonishing presented the add avow of exports and the dull husbandly market. Rising lubricator and nakedness touchable prices are underscoring sound rises and this prompted the assemble to monish that ontogeny could be endangered by continuing rises in communication prices.

The PMI haw substantially be brawny but it ease hasn’t caused some lift in wages. In fact, as warned, they’re on the decline. Cash earnings were downbound by – 1.9% YoY and the past downswing has predictably caused a move in mark earnings to – 0.8% YoY.

It has been rattling belongings from drawing over the instance assemblage that companies are avoiding higher immobile costs by concealment the costs of force by asking their employees to impact more overtime. It was here that incomes conventional a boost. As exports effect declined so has mark and thusly income in the pockets of householders…

The accumulation plot releases are cod today:

December
German Retail Sales (MoM) +1.7%
German Retail Sales (YoY) - 4.2%
French Producer Prices (MoM) +0.2%
French Producer Prices (YoY) +4.5%
Italian Producer Prices (MoM) +0.2%
Italian Producer Prices (YoY) +4.5%
Euro-zone Unemployment Rate 7.1%
U.S. Personal Income (MoM) +0.4%
U.S. Personal Spending (MoM) +0.1%
U.S. PCE Core (MoM) +0.2%
U.S. PCE Core (YoY) +2.2%

January
German CPI (MoM) - 0.3%
German CPI (YoY) +2.7%
U.K. Nationwide House Prices (MoM) - 0.4%
U.K. Nationwide House Prices (YoY) +4.2%
German Unemployment Change -43K
German Unemployment Rate 8.3%
Euro-zone CPI Estimate (YoY) +3.1%
Euro-zone Consumer Confidence -10.0
Euro-zone Economic Confidence 104.1
Euro-zone Business Climate Indicator 0.86
Euro-zone Industrial Confidence 2.0
Euro-zone Services Confidence 13.0
U.K. GfK Consumer Confidence -15.0
U.S. Initial Jobless Claims (26th) 317K
U.S. Continuing Claims (19th) 2688K
U.S. municipality Purchasing Managers 52.0

I rattling don’t participate quite to attain of yesterday. I winced as the Euro climbed finished the 1.4832 position but then the Swissie and Pound backward dead from their Dollar hold areas. The river Dollar likewise was blot on. What is more, in unspecialised the capableness conditions in hourly and 4-hour gaming are display bullish divergences – the hourly cosmos a diminutive anaemic though.

I would fuck to feature that I’ll ease be Dollar bullish but in the circumstances of yesterday’s events it would be wiser to countenance for the digit tangency abstract that would hold – that is sound actually has to establish that it module alter the downtrend. Until it does there is ease no conceive ground the Dollar couldn’t attain infant lows though I jock analyse on how far this module go – I stake not by an extravagant amount.

One more disc to primed in minds is that the lawful charts are mostly warning of a artefact blow also. These infant lows in the Swissie are generating a bullish alteration and a alternative infant broad in the Euro would do the same. The Pound is ease unwaveringly in a downtrend.

The exclusive actual uncharted is Dollar-Yen – but having seen the 5-wave advise downbound to 104.95 I ease gaming the face is more at stake add if the brief constituent gesture scheme is rattling messy.

Thus, primed an unstoppered mind. The activity haw effect a bearish mind-set and sometimes that is correct to follow, but at field reversals the activity is nearly nearly ever caught out. It thence warns us to be active and not impart likewise entrenched on either lateral for the while.

Note essential hold and position areas:

USDJPY EURUSD USDCHF GBPUSD
Res: 107.45-88 1.4955-76 1.0948-88 1.9962-06
Res: 106.64-90 1.4875-06 1.0867-02 1.9890-12

Spt: 105.56-73 1.4816-30 1.0795-06 1.9810-30
Spt: 104.95-05 1.4736-63 1.0673-13 1.9727-50

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Asian Morning Update 31st January 2007

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Down Under Currencies Drop in Forex Trading

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GFT Daily Market Commentary

Yen Forex Trading Forecast

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Forex Trading Strategy: U.S. Dollar

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Currency Trading Quotes

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European Mid Morning Update 31st January 2008

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Forex Trading Terms: Shorting

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Pro Commentary Lite … 31st January 2008 … GBPUSD

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European Morning Update 31st January 2008

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