FOREXYARD: Forex News Blog | |
| Markets Tumble On Japanese Crisis Posted: 15 Mar 2011 07:44 AM PDT
Volatility was higher than usual in the FX markets with global bourses sliding. The crisis in Japan is influencing interrelated markets as the Aussie dollar and Canadian dollar sold off sharply while the Japanese yen and the greenback strengthened. The AUD/USD traded as low as 0.9814 but paired its losses to open the New York trading session at 0.9860. The pair began the day trading at 0.9964. The USD/CAD climbed as high as 0.9973 before falling back to 0.9980. The opening day price for the pair was at 0.9812. The AUD/USD has found support at the January low of 0.9800. A breach below this level could spur further selling of the pair to the November low at 0.9530. Resistance comes in at 0.9970. For the USD/CAD, resistance is found at today's high of 0.9973 followed by the January high at 1.0060. Support is located at 0.9800. The USD/JPY was trading near its lows for the day at 80.85 after opening at 81.44. The pair should continue to move lower towards the October low at 80.20. Resistance is yesterday's high at 82.40. Frightened traders looked for safe haven assets during the European trading session and moved into long dollar and long yen positions as an intensifying situation in Japan has risk aversion at a peak for the year. Global bourses were lower across the board with the Nikkei 225 falling 10.55%. The FTSE was down 2.28%. At the opening of the New York trading session the Dow Jones Industrials Average was down 2.3%. Driving the indices and the currencies lower are fears of a nuclear accident in three Japanese power plants damaged in the tsunami. Also pushing the yen to new highs are increased expected costs from the cleanup. Due to the Japanese crisis, traders are shifting their interest rate expectations in developed nations as central banks may begin to tone down their hawkish rhetoric. At this stage today's US interest rate announcement seems to be a minor event on the economic calendar as the Fed is not expected to change its current position on the US economic recovery or US interest rate expectations. |
| US, Euro-Zone News Set to Generate Volatility Posted: 14 Mar 2011 11:48 PM PDT
With an abnormal number of news events coming from the euro-zone and the 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; the wise trader knows this. Special attention should be paid to the German Economic Sentiment report at 10:00 GMT, the U.S TIC Long Term Purchases at 13:00 GMT, and Federal Funds Rate at 18:15 GMT. Will you take advantage of the impending volatility, or sit on the sidelines and miss out? 10:00 GMT- German Economic Sentiment This monthly report reflects the level of diffusion index based on surveyed German institutional investors and analysts. This indicator always leads to extreme market volatility in the major currency pairs. If the results turn out to be lower than forecasts, then the EUR may record a fairly bearish session in today’s trading. 13:00 GMT- USD TIC Long -Term Purchases The Long Term Purchases report measures the difference in value between foreign long-term securities purchased by US citizens and US long-term securities purchased by foreigner during the reported period. This report has a direct correlation with the strength of the US economy. If the end result will beat expectations for 59.3B, the USD might strengthen as a result. 18:15 GMT: USD – Federal Fund Rate and FOMC Statement The FOMC is scheduled to release its decision on short term interest rates today. These monetary policy releases tend to have a stronger impact than other economic reports since they factor directly into the value of the nation's currency. Any increase to America's interest rates will no doubt boost the USD, but expectations are for the rates to be held steady today meaning traders shouldn't expect much change due to this report. |
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