FOREXYARD: Forex News Blog

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• Dollar Weakens After NFP Data
• Key Economic Events Taking Place Next Week
• Weekly Forecast: USD to Pare Losses this Week?
• Today’s Market Movers
• Dollar Rises and Oil Drops
• How to Trade Forex During News Events

Dollar Weakens After NFP Data Posted: 09 Apr 2012 12:51 PM PDT During Monday’s trading, the U.S dollar dropped points against the Euro as a result of a poor labor report from the U.S regarding employment in the nation. The highly anticipated Non-Farm Payroll report which is released on the first Friday of ever month reported surprisingly low figures on Friday last week. The NFP report released figures of 120,000 which came as a surprise due to the fact that that 210,000 was the expected figure. The report put some downward pressure on the greenback as the figures show fewer jobs were created, leading to concerns over the health of the economy’s recovery. This week will see a number of economic events  that could possibly affect the movements of the currency and commodity markets as we look ahead to data such as the American Trade Balance, U.S Initial Jobless Claims and the Bank of Japans Press Conference to name a few.

Key Economic Events Taking Place Next Week Posted: 06 Apr 2012 05:40 AM PDT There will be a number of economic events expected to stir up the financial markets in the second week of April. The reports include the U.S and Canadian Trade Balance,U.S consumer price index,Bank of Japans Rate Decision and monetary policy,Federal Budget Balance and U.S Jobless claims. Monday :U.S. Federal Budget Balance: This report will show the changes in the U.S federal balance for March 2012. It also indicates the government debt growth and could therefore affect the U.S dollar. The previous report in February resulted in the deficit sharply rising by $231 billion. Tuesday: Bank of Japan’s Rate Decision and Monetary Policy Statement will be published. The BoJ will decide on its interest rate and monetary policy. Up until no, the Bank of Japan has left the interest rate unchanged at 0 to 0.1 percent. If the BOJ decide to introduce monetary stimulus plans, it could potentially affect the Yen as well as commodities prices due to the fact that Japan is among the leading countries in importing commodities including crude oil. Thursday:Canadian Trade Balance- Figures from the January 2012 report showed a decrease in exports of 2.3 percent whilst imports fell 0.6 percent. The report could possibly affect the movements of the Canadian dollar which has a strong correlation to crude oil. Thursday: U.S. Producer Price Index: This report will present the progress in the PPI during March 2012. In the February report the index for finished goods rose slightly by 0.4 percent compared to January's rate and showed an overall increase of 3.3 percent for the past 12 months.This report from the U.S could have an impact on precious metal prices. There is a strong possibility that the key economic reports scheduled for release next week will have an impact on the currency and commodity markets.

Weekly Forecast: USD to Pare Losses this Week? Posted: 24 Jan 2011 03:00 AM PST The US dollar’s mixed results last week, on a fundamental level, may be broken down to a shift in risk appetite and consumer confidence. From a technical standpoint, the movement looks like a consolidating retracement against most of its rivals in anticipation of this week’s news. Here is a breakdown of this week’s events to give you an idea of how the US dollar will be affected in the days ahead. Tuesday: 9:30 GMT: GBP – Prelim GDP; Public Sector Net Borrowing - Both the US dollar (USD) and British pound (GBP) are expecting intense volatility this week, kicking off Tuesday with these two highly impacting reports from Great Britain. Gross Domestic Product (GDP) data tends to create a period of portfolio adjustment by large investors and banks while net borrowing figures represent debt and spending levels in the public sector. Traders should anticipate some intense volatility during this time. 15:00 GMT: USD – CB Consumer Confidence - Traders experienced last week what a shift in confidence can do to safe havens and higher yielding assets. The EUR rebounded last week against the USD as higher optimism allowed for a move into riskier assets. If today’s consumer confidence shows growing optimism in the United States we could see last week’s trend reverse, but the give-and-take between these two will certainly create intense volatility in the minutes after this publication. Wednesday: 19:15 GMT: USD – Federal Funds Rate and FOMC Statement - The Federal Open Market Committee (FOMC) will be releasing a statement about the latest round of interest rate decisions by the Federal Reserve Board on Wednesday evening. Interest rates are expected to remain near 0% for the foreseeable future, but the statement released by the FOMC has the potential to hint at future decisions and speculators take that time to adjust their positions simultaneously, boosting liquidity and potentially shifting the trends of the USD against its currency rivals. Thursday: 13:30 GMT: USD – Core Durable Goods Orders - Durable goods orders represents the level of percent change in demand for manufactured goods in the United States. Any decline in manufacturing tends to push the US dollar downward as it signals fewer investors purchasing the greenback in order to buy American goods. If the figure comes in at 0.9% as expected, a decline from last month’s reading, traders may anticipate a bearish USD immediately after it’s publication. 13:30 GMT: USD – Unemployment Claims - The weekly unemployment claims doesn’t usually have a significant impact on the USD unless the figure is remarkably different than expectations. This week’s report is forecast to remain more or less unchanged from last week’s, meaning the potential for a shocking release is greater than normal. Traders should expect high volatilty on Thursday. Friday: 10:00 GMT: CHF – KOF Economic Barometer - The Swiss Konjunkturbarometer (KOF) is a combined reading of twelve economic indicators related to banking confidence, production, new orders, consumer confidence and housing in Switzerland. It is perhaps the most significant report released by the Swiss regarding their economy and tends to have a great impact on the Swiss franc. This month’s reading is expected to have increased from last month’s, suggesting a continuation of the franc’s bullish behavior. 13:30 GMT: USD – Advance GDP - As with the British Prelim GDP released earlier in the week, the American Advance GDP tends to greatly shift investor portfolios leading to significant swings in USD values. This reading of the American GDP is expected to reveal 3.5% growth in value for American goods, adjusted for inflation, in an annualized format. Meaning, if the data comes in line with expectations, dollar values may increase as it may greatly boost investor appetite for US goods and services. What to expect: Last week’s movement among USD pairs and crosses may end up being determined as the beginning of a short-term consolidation pattern since this week’s news is set to effect the greenback heavily. Most reports seem to suggest relative calm, and perhaps even growth, for the US economy. This suggests that, if last week’s movements were in fact a consolidation pattern, this week’s movements may actually see the greenback recovering its losses and shifting back into a bullish posture. Traders should be anticipating the tip of the consolidation trend and the impending reversal.

Today’s Market Movers Posted: 03 Mar 2010 08:04 PM PST Traders can expect a busy day ahead for major crosses. We get 2 interest rate decisions at the same day coming from UK and the EU plus important U.S releases. The most important aspect of a rate decision is the accompanying statement from the central bank, hopefully giving insight to what their next decision will be. 12:00 GMT GBP Official Bank Rate - The U.K interest rate it isn't expected to move from 0.5% – same as last month. The focus will be on the MPC rate statement, which might hint about future policy, especially regarding the QE program, also known as the Asset Purchase Facility. The program ran out of 200 billion pounds allocated to it, and Mervyn King didn't rule out an option to pump more money into it, weakening the Pound further. 12:45 GMT EUR Minimum Bid Rate - Jean-Claude Trichet is expected to leave the European Minimum Bid Rate at 1%, continuing the ritual from previous months. Spain and especially Greece will continue to be a burden on the Euro zone, and this will probably be the focus of the press conference, held 45 minutes after the announcement. Trichet might also hint about future policy, but it will probably remain unchanged. 13:30 GMT USD Unemployment Claims - Providing the last hint about the Non-Farm Payrolls, this weekly release is expected to show some improvement after last week's disappointing figure – a rise to 496K, a number not seen in a long time. It's expected to drop back to 472K. 15:00 GMT USD Pending Home Sales - This figure returned to stability last month, rising by 1%, but this time it's predicted to fall again as the housing sector continues to suffer, as we see in the new and existing home sales numbers. A rise of 1.4% is expected.

Dollar Rises and Oil Drops Posted: 29 Jul 2009 10:41 PM PDT The 2 leading trends in the market at the moment are the bullish US Dollar and bearish commodities, especially Crude Oil and Gold. It is very clear that the two trends are highly correlated, thus whenever one of them will show signs of reversing, the other one is likely to follow. The main reasons for these trends are statements from China that it will maintain a loose monetary policy, as well as yesterday’s unexpected high Crude Oil Inventories report. Crude Oil Inventories simply showed that oil supplies in the U.S have grown substantially; highlighting weak demand and possibly lower growth forecasts. Every time this report offers surprising results, a sharp change in oil’s value is promptly followed. This time around, the result was to push the price of Oil lower than was anticipated. Today’s leading publications: 07:55 (GMT) – German Unemployment Change: This report will show if the German unemployment condition has worsened in line with expectation during June. If the actual result will be similar to forecasts, the EUR is expected to drop. 12:30 (GMT) – U.S Unemployment Claims: This report shows the changes in U.S unemployment during the last week. Analysts forecasted that 573K people have lost their jobs during the past week. Such result will be the worst result in the past 4 weeks and is likely to strengthen the demand for the safety of the Dollar. However, if the actual result will be somewhat better, then the Dollar might lose some steam.

How to Trade Forex During News Events Posted: 21 Apr 2009 09:09 AM PDT Looking over the market today brought to my attention 2 significant events which, in my opinion, appear to have gone unnoticed by many of ForexYard’s traders. Being a currency analyst in a forex trading company gives one the unique perspective of watching the economy for a living and being given access to some of the most up-to-date information on the market as it’s released, and seeing what impact it carries on the value of various currencies in real-time. The 2 events I’m speaking of were both highlights of today’s trading news. First was the German ZEW Economic Sentiment report, which is a measure of consumer confidence in the Euro-Zone’s largest economy. The second was the Bank of Canada’s (BoC) decision regarding its short-term interest rates. Both produced market-shocking results and moved the market substantially, but traders simply weren’t trading. The ZEW report came out much higher than anticipated and revealed that there is growing optimism in the Euro-Zone’s regional economy, which resulted in some moderate support for the EUR. Later in the day, the BoC surprised traders with a decision to reduce interest rates by 25 basis points, going against market forecasts which predicted that they would hold rates steady. The CAD responded by losing substantial value in the span of a few minutes. The results of these news events were clearly laid out in previous articles on this site (See Yan and Rita’s articles regarding these events), and had traders been paying close attention, they could have made substantial gains. Information about news events can sometimes be contradictory, but oftentimes there are those news events which produce very predictable results. Today’s 2 major events are examples of this. The few traders who were in the market today made lucrative sums of money by going short on the CAD and long on the EUR. If you were one of them, then congratulations; if not, then ask yourself if you really are doing what it takes to be an effective forex trader. If you want to learn more about how to understand these news events, subscribe to ForexYard’s newsletters by opening your own Free Demo Account, read up on what’s happening on our weekly calendar, and last but not least, enter our Live Chat and speak with one of our experienced dealers. They can really help with deciphering the confusing world of forex.

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