Wednesday, January 5, 2011

FOREXYARD: Forex News Blog

FOREXYARD: Forex News Blog

Link to Forex Trading Education : Forex Trading Blog by FOREXYARD

Technicals Show Potential Pullback in Gold Prices

Posted: 04 Jan 2011 06:18 AM PST

printprofile

Spot gold prices continue to climb but price stalled at a previous all-time high and the commodity looks to head lower.

Following a failed breach of the resistance level at $1423 the price of spot gold as moved lower.

Technicals on the daily chart point to a potential fall in the price of spot gold. Declining Momentum (7) will shortly provide a sell signal by dipping below the 100 level. Falling stochastics on the daily chart also support a decline in the price.

Support for the pair is found at the mid-December low at $1361 followed by the rising short term trend line off of the October and November lows.

Resistance is located at mid-December high at $1408, followed by the previous high at $1423, and finally at the all-time high at $1431.

Gold

GBP/USD Reaches Short Term Resistance

Posted: 04 Jan 2011 04:23 AM PST

printprofile

The GBP/USD has risen in early trading to a resistance line that may contain the pair for the rest of the trading day.

As the Cable rises, it has run into a resistance level at 1.5650. Traders may be able to use this as an entry point to short the pair with a first target at the short term support level at 1.5540 followed by the December low at 1.5340.

Further resistance may be found at the falling trend line from the November high which comes in today at 1.5700.

GBPUSD Daily

Dollar May See Boost against NOK

Posted: 04 Jan 2011 03:18 AM PST

printprofile

Since early last week, the US dollar has been steadily dropping against its Norwegian counterpart. The USD/NOK pair has fallen close to 1300 pips since the 27th of December, largely due to the low volatility that existed in the marketplace around the Christmas holiday. It now appears that the pair may be due for a reversal, with technical indicators showing an impending bullish move is likely to occur.

We will be analyzing the daily chart for the USD/NOK pair, provided by Forexyard. We will be looking at the Stochastic Slow, Williams Percent Range and Relative Strength Index (RSI).

1. As we can see, the Stochastic Slow has formed a bullish cross. This is typically a solid sign that the pair is in oversold territory, and an upward correction is likely to take place.

2. When analyzing the Williams Percent Range, we typically view the -80 and -20 levels as the borders for the instrument being in oversold and overbought territory, respectively. As we can see, the indicator is just below the -80 level, meaning the USD/NOK is likely oversold and may see bullish movement.

3. The RSI is currently right on the border of being in the oversold region. Traders will want to keep a close eye on this indicator. When it crosses the bottom support line, upward movement will likely follow.
scand 4.1

Positive Data Causes the Kroner to Move Up against Dollar

Posted: 04 Jan 2011 03:14 AM PST

printprofile

As we start off the new year, we see that the Scandinavian kroner continues to make gains against the US dollar as positive fundamental indicators have boosted confidence in the global economic recovery. While the Scandinavian currencies have also moved up vs. the euro, the gains have been slightly more muted due to the 16-nation currency’s appeal to risk taking investors. Positive US employment data released last week has actually weakened the dollar against the kroner, as investors abandoned the safe haven greenback.

The last week has seen the USD/NOK and USD/DKK pairs fall close to 1300 pips. Meanwhile, the USD/SEK has tumbled some 1500 pips. Against the euro, none of the Scandinavian currencies have managed to gain more than 500 pips over the last seven days.

This week, traders can anticipate heavy volatility among the Scandinavian pairs ahead of the release of this month’s US Non-Farm Payrolls figure. The Non-Farm indicator is widely considered the most significant economic event of the month, and heavy market activity is expected. Should the payrolls number come in above analyst predictions, traders can expect the kroner to extend its bullish trend against the dollar. At the same time, a positive Non-Farm’s figure is likely to increase demand for the euro, causing the kroner to drop against its euro-zone counterpart.

USD/CHF – Enter Short at Trend Line

Posted: 04 Jan 2011 01:55 AM PST

printprofile

Following a sharp rise in the value of the pair that coincides with broad based CHF selling today, an entry short in the direction of the long term trend has presented itself.

The USD/CHF has risen as high as the trend line that runs lower from the November high where the pair has faced significant selling pressure. Today the trend line coincides with a price of 0.9445.

Traders may want to enter short near this level, placing either a volatility stop such as half the Average True Range which today is 100, or hard stop above the trend line at the next resistance levels of 0.9495 or 0.9560.

A target for the pair may be the all-time low which was made last week at 0.9299.

USDCHF Daily

GBP/USD – Bias to the Downside

Posted: 04 Jan 2011 12:06 AM PST

printprofile

Judging from the long term chart pattern and other technical indicators, sentiment for the Cable should be to the downside.

As the year ended, the Cable traded in the middle of a consolidation pattern from the sharp downtrend in 2008. The GBP/USD retraced the 2008 slide up to the 38.2% Fibonacci level but failed to proceed any higher. This hints to further losses in the pair. Supporting a move to the downside are the falling stochastics on the monthly chart. The failure of the Cable to maintain a level above the 20-month moving average also does not bode well for the pair.

Short term support for the GBP/USD can be found near the 1.5300 level, with further support at the bottom line of the long term consolidation pattern at 1.4590. A breach below this level may trigger further selling with a long term target the 2009 low of 1.3500.

Resistance for the Cable should be the 20-month moving average at 1.5755, followed by the 38.2% Fibonacci retracement from the late 2007 to early 2009 downtrend at 1.6430. This level coincides with the downward sloping trend line from the 2007 high. A move above this level may target the 2009 high at 1.7040.

GBPUSD

NZD/USD Reverses Course, Targets 0.7500

Posted: 03 Jan 2011 10:17 PM PST

printprofile

The US dollar's decline against most other major currencies yesterday appears to have skipped the Pacific country of New Zealand. The NZD/USD, as will be shown below, actually underwent a bearish session, with many indicators signaling a continuation of this downtrend.

Looking at the chart below, we can see that the pair spiked upward as 2010 came to a close, but has actually reversed course over the past few days.

The Stochastic (slow) reveals a bearish cross taking place just before the end of the year, followed by a now descending price movement. This suggests added momentum to the newly formed downward direction of the pair.

The Williams Percent Range and Relative Strength Index (RSI) both show similar price behavior. Both of these indicators were floating in the over-bought region and have since begun to move downward, suggesting bearish pressure. In the case of the RSI, the price appears to still be over-bought, which highlights the bearish notion further.

It appears this pair has entered a downturn which may last throughout the remainder of the week with a short-term target near 0.7650 and a longer-term target of 0.7500. Traders have a chance to capture these movements for profit with short positions in their Forex Trading Account.

NZD/USD – Daily Chart
NZDUSD - Daily Chart

EUR Bullish as US Stock Rally Bolsters Risk Appetite

Posted: 03 Jan 2011 09:54 PM PST

printprofile

The euro experienced one of its most bullish trading days in recent weeks on Monday. The EUR was affected by the US stock market rally and bearish dollar. The US stock market rally led investors to buy back into the EUR, as they looked for returns on buying commodity-linked and higher-yielding currencies in Monday’s trading.

Another developing trend is the recovery of crude oil as bitterly cold weather in Europe and the United States boosted expectations of rising heating fuel demand. It is currently trading around $91.70 a barrel. As for today, oil is set to be in the spotlight again with important publications from Europe and the US; it has the potential to reach 95$ a barrel before the week's end if the current mood persists.

Here are today's leading events:

9:30 GMT: GBP – Manufacturing PMI

This monthly report on the British manufacturing sector is a strong leading indicator of economic health and industrial expansion for the UK. Should this report come out as expected, or higher, the British pound could see some added strength.

19:00 GMT: USD – FOMC Meeting Minutes

The Federal Open Market Committee's (FOMC) meeting is very important as it is very likely to impact the US dollar's volatility. While the impact of such statements is often not forecast, there is always the possibility that the FOMC will comment on a number of developments in the region and hint at future policy changes. Speculators will attempt to use those statements as a gauge of direction for the USD in the coming weeks and adjust their positions accordingly. Therefore, this speech will likely create volatility as it gets underway, but direction is unclear.
Posted by at

No comments:

Post a Comment

Subscribe to: Post Comments (Atom)