FOREXYARD: Forex News Blog

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• Snore-Inducing News Day Adds Focus to Greece Vote
• British M4 Money Supply Stagnant
• Canadian Dollar Soars alongside Inflationary Growth
• Greek Protesters Clash with Police but Euro Strength Prevails
• Stability in the Riksbank but SEK Slumps
• Greek Austerity Vote – Buy the Rumor, Sell the Fact

Snore-Inducing News Day Adds Focus to Greece Vote Posted: 29 Jun 2011 06:59 AM PDT In a bizarre circumstance, the news published on today's calendar – beyond the Greece riots and austerity budget vote – are being released predominantly in line with market forecasts. Daily news tends to generate swings in currency values because actual results rarely line up with market forecasts and the adjustments in portfolios which occur after a release generate volatility. Today's news out of Japan, Switzerland, and Great Britain, however, have all come in line with forecasts, creating a flat technical trading day amid one of the most tumultuous news days in recent memory. The Greece vote and concurrent riots are still capturing the spotlight, but today's snore-inducing news is aiding its central focus perhaps beyond what it otherwise would be. Is this good or bad for the EUR? Read more forex trading news on our forex blog.

British M4 Money Supply Stagnant Posted: 29 Jun 2011 06:56 AM PDT The amount of Great British pounds (GBP) in circulation domestically in the United Kingdom, and deposited in local banks, grew a meager 0.1% this past month, below expectations for a 0.3% increase, month-on-month. The report released on the M4 Money Supply this morning by the Bank of England (BOE) does not tend to have much impact on the currency market, but it struck me as interesting that the amount of GBP held locally shrank in June. The data lines up well with the ominous Current Account published yesterday that revealed a sharp increase to the nation's trade deficit; indicative of a movement of local currency away from its home market. Read more forex trading news on our forex blog.

Canadian Dollar Soars alongside Inflationary Growth Posted: 29 Jun 2011 06:48 AM PDT Today's consumer price index (CPI) reports out of Canada gave traders reason to buy into the Canadian dollar (CAD), colloquially known as the Loonie. Both the nominal and the core readings came in well above forecasts in the northern giant's first publication of highly bullish and impactful news since the June 10th publication of the country's unemployment rate. Forex traders took cue from the CPI figures as a sign to go long on the CAD. The nominal reading for the country's CPI was in at 0.7%, beyond the expected 0.2%. The core reading, which does not take into account 8 of the more volatile goods and services that distort the underlying trend, revealed 0.5% growth, beyond a similar 0.2% expectation. Read more forex trading news on our forex blog.

Greek Protesters Clash with Police but Euro Strength Prevails Posted: 29 Jun 2011 05:11 AM PDT The dollar was lower across the board and as it currently looks the Greek austerity vote is set to pass. As such the safe-haven currencies yen and the Swiss franc are lower with equities performing well. The euro is up versus the dollar and in the crosses as this week's recovery continues. Protesters are clashing with police in the streets of Athens but the main event remains inside the Greek parliament where the vote for the medium-term fiscal strategy will take place. With the euro climbing to its highest level in a week and the FTSE 100 up by 1.50%, markets fully expect the legislation to pass, if only by a narrow margin. The euro looks to move higher on a successful vote but this would by no means leave the euro out of the woods as further risks down the road could provide selling opportunities as the Eurogroup meeting on July 3rd draws near. Both S&P and Fitch remarked today that French debt plan would need a 2nd look before an immediate declaration of a credit event. Worst case scenario for today; should the legislation be voted down the euro would likely spiral lower towards support at 1.4115. As it stands the EUR/USD is currently testing the 1.4440 resistance level with the next resistance found at the falling resistance line from the May and June highs which comes in today at 1.4550. Read more forex trading news on our forex blog.

Stability in the Riksbank but SEK Slumps Posted: 29 Jun 2011 02:49 AM PDT The Swedish krona has been on its back foot versus the euro and yesterday's decline in retail sales shows a considerable drop in activity. The report overshadowed the stability that was added to the country's central bank the as Chairman Stefan Ingves was re-elected to another 6-year term as head of the Riksbank. The krona has struggled to find footing versus the euro and yesterday was no different. Swedish retail sales numbers for the month of May contracted from the previous year by -1.1%. The data was off from the April numbers which showed a sharp 5.6% y/y gain. The negative retail sales report overshadowed the additional 6-year term that was granted to current Chairman of the Riksbank Stefan Ingves. Despite the fact that 6-months remain in his current term, the Riksbank was out in front of the markets to announce Invges' extension. This will provide a level of stability for the Swedish central bank and serve to underline its independence from Swedish political pressures. Such a situation is needed for proper management of Swedish monetary policy which faces rising inflationary pressures due to strong economic growth and rising wages. Turning to the charts, the euro has just about retraced the entire move lower from the 2010 November high. The pair found support at the 9.1200 level and the next target for the EUR/SEK looks to be the 9.4250 off of the Q4 high. Read more forex trading news on our forex blog.

Greek Austerity Vote – Buy the Rumor, Sell the Fact Posted: 29 Jun 2011 12:14 AM PDT The euro continues to rise as the vote on the next Greek austerity program nears with market participants expecting a positive outcome. This may set up an opportunity to "buy the rumor, sell the fact," as the release of the next tranche from Greece's first bailout simply kicks the can down the road. A solution to the underlying burden of Greek debt remains to be found. EUR – Greek Austerity Vote The debate rages in the Greek parliament while rioters run amok in the streets of Athens leading up to today's austerity vote. The euro has been bid with a majority of expectations for a successful passage of the plan which would allow Greece to receive the final tranche from its first bailout. But the weight of the debt burden will not be lifted from Greece but only pushed further into the future. This may present a selling opportunity in the present euro rally. Last week's high at 1.4440 is the first resistance followed by the early June high at 1.4700. Support is found at yesterday's low at 1.4240 and the rising support line from the mid-May low at 1.4115. USD – Pending Home Sales m/m – 14:00 GMT Expectations: 2.4%. Previous: -11.6%. Forecasts are for a rebound from the previous month's sharp downturn in pending home sales though this data release will largely be put on the back burner to the events taking place in Greece. Read more forex trading news on our forex blog.

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