FOREXYARD: Forex News Blog | |
- AUD/NZD Uptrend Might be Near the End
- Buy Signals on NZD/CHF
- US Dollar Rebounds on Strong Retail Sales
- EUR/NOK Momentum Continues to the Downside
- Swedish Interest Rate Decision
- AUD/USD Poised for Downward Correction
- Heavy News Day Set to Impact Majors
- USD/JPY – Entry Long to Post Intervention High
- Euro Continues To Weaken Amid Debt Contagion Concern
- EUR/USD Falling Wedge Pattern
| AUD/NZD Uptrend Might be Near the End Posted: 16 Dec 2010 12:44 AM PST
In the last three weeks trading, the AUD/NZD experienced much bullishness, as it stands now at 1.3400. However as I demonstrate below, it seems that the pair's bullish run may have run of steam, and a bearish correction could be underway soon. Forex traders can take advantage of this imminent downward movement by entering short positions at an excellent entry price. • Below is the 8-hour chart of the AUD/NZD currency pair. • The technical indicators that are used are the William Percent Range, Relative Strength Index (RSI), and Slow Stochastic. • Point 1: There is a "doji" candlestick that has formed on the chart, indicating that a reversal should take place. • Point 2: The Slow Stochastic indicates a bearish cross, signaling that the next move may be in a downward direction. • Point 3: The Relative Strength Index (RSI) indicates that the price of this cross currently floats in the overbought territory, signaling downward pressure. • Point 4: The Williams Percent Range also supports the downward direction. AUD/NZD 8-Hour chart |
| Posted: 15 Dec 2010 02:49 AM PST
The pair has recorded much bearish behavior in the past several days. However, the technical data indicates that this trend may reverse anytime soon. For example, as I demonstrate below, the 8-hour chart signals that a bullish reversal is imminent. Forex traders have the opportunity to wait for the upward breach on the hourlies and go long in order to ride out the impending wave. • Below is the 8-hour chart of the NZD/CHF currency pair. • The technical indicators used are the Slow Stochastic, Williams Percent Range, and Relative Strength Index (RSI). • Point 2: The Relative Strength Index (RSI) signals that the price of this pair currently floats in the over-sold territory, indicating upward pressure. • Point 3: The Williams Percent Range has peaked near at the -100 marker, which means that there may actually be a strong level of upward pressure. NZD/CHF 8- Hour Chart |
| US Dollar Rebounds on Strong Retail Sales Posted: 14 Dec 2010 10:32 PM PST
The US dollar appears to have rebounded against its primary currency rivals yesterday and this morning. Solid growth in American retail sales and inflationary figures led many traders to take profit on dollar pairs. A continuation of the US interest rates at <0.25% came as expected and today's news looks to be positive for the USD as well. Here is a roundup of today's leading events: 9:30 GMT: GBP – Claimant Count Change This report measures the number of individuals claiming unemployment benefits for the first time during the previous month. While it is considered a lagging indicator, it nevertheless carries a strong impact on the GBP market since it is released a month prior to the unemployment rate and thus affects outlook on consumer spending and growth. 14:00 GMT: USD – TIC Long-Term Purchases The Treasury International Capital (TIC) report measures the difference between foreign capital purchased by US investors and US capital purchased by foreign investors. Its intention is to measure investment flows into and out of the United States. The higher the reading, the more money is flowing into the US relative to the amount of money flowing out of the US, and thus indicates higher demand for the US dollar. |
| EUR/NOK Momentum Continues to the Downside Posted: 14 Dec 2010 07:01 AM PST
In staying with the previous analysis, the EUR/NOK has broken below its rising intermediate trend line on the daily chart and continues to move lower towards its year low. Following a sharp drop in the value of the pair, the EUR/NOK breached its intermediate rising trend line that extends off of the lows in May and September of this year. The pair has continued to move lower making its way to the 7.8900 level today. Technical studies show more moves to the downside may be in store for the pair. Momentum is falling and the EUR/NOK has closed below both the 100 and 200-day simple moving averages. Previously identified support levels remain intact beginning with the September low of 7.8300, followed by the June low of 7.800, and finally the swing low on the daily chart at 7.6685. Resistance comes in at the 8.000 level and the October high of 8.2540.
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| Swedish Interest Rate Decision Posted: 14 Dec 2010 06:56 AM PST
Tomorrow will bring interest rate decisions from both Norway and Sweden. However, the two countries differ as Sweden is expected to raise its benchmark rate while Norway will most likely hold interest rates steady. Economists forecast Sweden's Riksbank will increase its repo rate by 0.25 basis points to 1.25%. Norway's Norges Bank is expected to maintain its deposit rate at 2%. One reason for the expected rise in the Swedish interest rate is the spike in housing prices. For the past 18-consecutive months housing prices have risen. Over the last 3-months alone housing prices are up 5%. Housing prices in Norway have also turned sharply higher rising 6.2% this year. The spike in housing prices may have been caused by interest rates being held too low by both nations during the financial crisis of the past 2.5 years. A sharp jump in housing prices has been accompanied by lower than expected inflation as the Riksbank targets annual inflation of 2% while the Norges Bank targets 2.5%. As both countries move towards a tighter monetary policy both the Norwegian and Swedish krona may benefit as the interest rate differential widens between the Nordic countries and the rest of the world. Currently the ECB has interest rates set at 1.00% while the US keeps its interest rate below 0.25% along with engaging in further loosening of monetary policy. |
| AUD/USD Poised for Downward Correction Posted: 14 Dec 2010 12:17 AM PST
Over the last several weeks, the Australian dollar has been able to capitalize on the poor economic situation in the United States and make substantial gains against the USD. Since the beginning of the month, the AUD/USD pair has moved up some 400 pips. Forexyard traders will be interested to know that the pair may be due for a downward correction. Technical data indicates the cross is currently in overbought territory, meaning bearish movement is likely. We will be looking at the 8-hour chart for AUD/USD, provided by Forexyard. The technical indicators being used are the Williams Percent Range, Stochastic Slow, and Relative Strength Index. 1. Typically when the Williams Percent Range is over -20, it is a clear indication that the instrument is overbought. Here, we can see the indicator is right around the -5 level, meaning a downward correction may take place. 2. Traders will want to keep a close eye on the Stochastic Slow, as it is currently showing the pair approaching the overbought region. Should the two lines intersect above the 80 level, it can be taken as a clear signal of impending bearish pressure. 3. Finally, the Relative Strength Index is currently right around the 75 level. Anything above 70 is usually taken as a sign that the pair could experience downward movement. Now may be a great time for traders to enter into sell positions at a great entry price, in order to capitalize on the coming trend. |
| Heavy News Day Set to Impact Majors Posted: 13 Dec 2010 10:57 PM PST
With an unusually large number of news events coming from the euro-zone and United States today, forex traders have been in a frenzy to place their bets before the trading day gets underway. Trading during these news events, which typically carry a lot of market volatility, is a fast way to double your forex trading balance. Special attention should be paid to the German Economic Sentiment report at 10:00 GMT, the U.S Retail Sales at 13:30 GMT, and Federal Funds Rate at 19:15 GMT. Will you take advantage of the impending volatility, or sit on the sidelines and miss out? 10:00 GMT- German Economic Sentiment • It reflects the level of diffusion index based on surveyed German institutional investors and analysts. 13:30GMT- US Retail Sales • It reflects the change in the total value of sales at the retail level. 19:15 GMT- U.S Federal Funds Rate |
| USD/JPY – Entry Long to Post Intervention High Posted: 13 Dec 2010 12:24 AM PST
The USD/JPY is currently moving towards its recent high of 84.40. A close above this level shows limited resistance until the September high. Long term time frames also signal a continuation of the move. Following the pair's breach of the long term downward sloping trend line (1) on the daily chart the pair has risen to the 84.40 level (2). Clearly defined support and resistance levels appear on the chart and a buy signal is supported by a long term technical sign. An entry long may be initiated with a move above the 84.40 (2) level targeting the post intervention high at 85.90 (3). Further resistance at 88.10 (4) can be used as a long range target as resistance is lacking on both the daily and longer time frame charts. A long term downward sloping trend line on the weekly chart (not shown) may also provide resistance at 88.60. Support can be found at both 83.45 (5) and 82.30 (6), as well as the rising trend lines off the October and November lows.
The monthly chart provides a hint at the potential long term future price action with a rising stochastic oscillator.
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| Euro Continues To Weaken Amid Debt Contagion Concern Posted: 12 Dec 2010 10:06 PM PST
The main trend in the market continues to be the bearish euro. Over the past month, the EUR/USD pair dropped from the 1.4200 level, and reached as low as the 1.2970 level. The pair recently saw a technical correction, which took it up to the 1.3440 level, yet now the pair is trading below the 1.3200 level once again. The reason for the euro's bearishness is of course the broad concerns that another member of the European Union will seek financial aid, after Greece and Ireland. The countries which are considered to be at the higher risk-level to reach such a scenario are Portugal and Spain, and the biggest concern is that the euro-zone won't be able to deal with another financial bailout, which will lead to the end of the European joint currency. On December 16 a summit between European leaders will take place regarding the disturbing situation, and official statements from the summit are likely to create heavy volatility in the market. Until then, traders are advised to follow the updates regarding the European debt crisis, and to take under consideration that the euro might face further bearishness in the near-future. Here are today's leading news events: • 09:30 GMT, British Producer Price Index (PPI) Input – This report measures the change in the price of goods and raw materials purchased by manufacturers. It's considered to be a leading indicator of consumer inflation, and thus tends to have a large impact on the sterling. An end result greater than 1.0% might boost the pound. • 18:30 GMT, Europeans Central Bank President Trichet Speaks – Trichet is scheduled to deliver a speech at the Internationaler Club in Frankfurt. Trichet might discuss the ECB's ideas on how to deal with the current crisis, and heavy volatility is likely to take place during his speech. |
| Posted: 10 Dec 2010 07:48 AM PST
The EUR/USD continues to trade sideways and has created a falling wedge pattern on the hourlies. Looking at the hourly chart, traders may notice a falling wedge pattern developing. Typically a falling wedge will break to the upside (though this direction runs contrary to the current trend on the daily chart). Supports are found at 1.3050 as well as the bottom of the recent consolidation in the pair at 1.2970. Short term resistance levels are located at 1.3280 as well as 1.3400 and 1.3440.
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