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- GBP/NZD-Technical Update
- EUR/CAD Consolidating, Limited Bullishness Expected
- Volatility Expected Day Before Friday’s NFP
| Posted: 03 Mar 2011 09:22 AM PST
This pair's sustained upward movement has finally pushed its price into the over-bought territory on the 8-hour chart's RSI. Not only that, but there actually appears to be a bearish cross on the Slow Stochastic pointing to an imminent downward correction. Forex traders have the opportunity to wait for the downward breach on the hourlies and go short in order to ride out the impending wave. The next support levels are found at the 2.1920, 2.1890 and 2.1870 levels
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| EUR/CAD Consolidating, Limited Bullishness Expected Posted: 02 Mar 2011 11:30 PM PST
Since the start of 2011, the EUR/CAD has been fluctuating within an ever-tightening range. The consolidation point for this trend appears to be just below 1.3600. Looking over the technical indicators it seems worthwhile to point out that current momentum is bullish and we have what appears to be a relatively clear target at 1.3600 prior to any sharp movements. This price target is well within reach today. Given the flurry of events on today's calendar, especially out of the euro zone, there is a strong possibility that the EUR will gain the needed boost to touch this consolidation point. The Stochastic (slow) on the chart below shows a cross just above the over-sold region, making it a weaker indication of upward mobility, but a bullish signal nonetheless. The MACD also reveals what could be a bearish cross, countering the limited upward strength shown on the Stochastic indicator. Since the price is within 100 points of its consolidation target, these conflicting signals make sense. There is enough data to support the upward move towards this point, but not enough to justify breaching that target. It seems more likely that traders will witness a downturn in the pair once the consolidation price target is reached today. This is also supported by rising Crude Oil prices, which often support the value of the Canadian dollar (CAD). EUR/CAD – Daily Chart |
| Volatility Expected Day Before Friday’s NFP Posted: 02 Mar 2011 11:00 PM PST
The EUR experienced one of its most bullish trading days in recent weeks on Wednesday. The EUR made significant gains against many of its most traded currency pairs, such as the GBP, JPY and USD. Today's busy calendar will have forex traders highly active in the upcoming European and American sessions. The euro zone will publish their interest rate decisions along with monetary policy statements. The US will later publish its trade balance and weekly unemployment claims and ISM Non-Manufacturing PMI report prior to tomorrow's very significant NFP figure. Here is a roundup of today's leading events: 12:45 GMT: EUR – Minimum Bid Rate The release of the European Central Bank's (ECB) latest decision regarding its short-term interest rates will no doubt have a heavy effect on the value of the EUR. Predicting the movement of the 17-nation currency following such reports is, however, highly difficult given the volatility typically experienced around this event. Traders should make sure to protect their positions today and expect sharp movements in the market. 13:30 GMT: USD – US Unemployment Claims This indicator reflects the number of individuals who filed for unemployment insurance for the first time during the past week, and is considered to be the broadest measure of economic health. If the end result will show a better than forecast figure the USD might get boosted. 15:00 GMT: USD – US ISM Non-Manufacturing PMI This indicator measures the level of a diffusion index based on surveyed purchasing managers, excluding the manufacturing industry. As leading indicators of economic health, businesses react quickly to market conditions and this report has a direct correlation with the strength of the US economy. Today's forecast is for higher growth than last month, indicating that a positive return to economic normalcy is beginning to get underway. Such an outcome should boost the USD. |
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