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- GBP Shores Up Daily Losses after Retail Sales
- Japanese Q2 GDP Shows Contraction of 0.9%
- Dollar is Range Bound Prior to US Economic Data Releases
| GBP Shores Up Daily Losses after Retail Sales Posted: 19 May 2011 05:52 AM PDT
The British pound (GBP) jumped back this afternoon following the morning's publication of retail sales figures out of the United Kingdom. Expectations were for a rise of approximately 0.9% but the actual results came in slightly higher at 1.1%. As a result of this report, traders jumped back into the pound in short-term trading, pushing the value of the GBP back to today's opening price after a morning drop of 50 pips versus most of its primary currency pairs. Helping this movement back into the GBP was a better-than-forecast industrial order expectations report. Published at 12:00 GMT, the industrial orders data showed a quickened increase in the industrial sector from the previous month's faltering. Today's news highlighted a relatively strengthened British economy, though many remain skeptical of growth figures given their fragile nature these past several months. For the day ahead, prior to this week's close, the British pound appears to be in a position to continue gaining. As of late-afternoon trading, the GBP/USD has pushed beyond its opening price by about 15 pips and does not appear to have much standing in its way. ead more forex trading news on our forex blog. |
| Japanese Q2 GDP Shows Contraction of 0.9% Posted: 19 May 2011 05:47 AM PDT
The Japanese yen (JPY) began trading in a bearish direction against most of its currency rivals yesterday after the Bank of Japan (BOJ) released data which showed the Japanese economy contracting by 0.9% so far this quarter. After a week of ups and downs, the Japanese yen now appears to be in a weaker position and is taking a beating by traders in today's early hours. Adding to this bearish sentiment is also the revised industrial production figure which was released this morning slightly lower than expectations. The dominant stance of risk aversion overarching this week and last had many traders moving towards the yen until yesterday. The dominant stance now appears to be a flight to other safe-havens like the Swiss franc (CHF) and, in many instances, the Scandinavian kroner (i.e. SEK, NOK, DKK). As of this morning, the USD/JPY has moved up over 80 pips from 80.00 to 80.88. Japan's tertiary activity was published yesterday morning and also revealed a severe downturn of approximately 6.0%. This morning's GDP figure was another bearish marker on the currency and so far traders are moving away from their JPY investments as a result. Should tomorrow's monetary policy statement give further dovish statements, the yen may find itself losing value against its primary currency rivals prior to this week's close. Read more forex trading news on our forex blog. |
| Dollar is Range Bound Prior to US Economic Data Releases Posted: 19 May 2011 05:20 AM PDT
The US dollar is mixed versus the majors and continues to be traded inside previous defined price ranges. Momentum in favor of the dollar is waning and could be derailed after this afternoon's US economic data releases. This morning's dollar strength on the back of yesterday's Fed meeting minutes faded after traders once again found the euro attractive given the disparities between US and European monetary policy. Highlights from the Fed's previous policy meeting show the Fed's plan for exiting the ultra-loose monetary policy but failed to provide traders a timeline as to when the tightening will begin. The EUR/USD found bids at the 1.4200 level but remains capped at 1.4300. Dollar bulls will need to make a stand between the 1.4300-1.4350 levels to keep the momentum in favor of the greenback. Sterling was trading higher after better than expected UK retail sales. However, traders may not want to look too deep into the data as the strong consumer numbers may have been driven by one off events such as the Royal Wedding and the Easter holiday. Markets have also been flooded with bearish sentiment for sterling with the changing of the guard at the BoE MPC. Cable has support near 1.6100 and 1.6050 near the rising trend line off of the May 2010 low. Resistance comes in at this week's high at 1.6300. The USD/JPY is pushing the 82.00 level on the back of weaker than expected GDP numbers. The data shows the Japanese economy was likely headed for a recession prior to the earthquake and tsunami. USD/JPY will likely target retracement levels from the April to May move at 82.50 followed by 83.25. US housing, manufacturing, and unemployment data are due to be released shortly. Strong US economic data should feed into dollar selling but today's tight trading ranges may hold the majors within the recent price action. Read more forex trading news on our forex blog. |
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