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Forex Market Updates & Commentary

Forex Market Updates & Commentary

Link to Forex News and Commentary by FXDD

Feds Kockerlakota expects unemployment near 8%-8.5% at end of 2012

Posted: 20 Dec 2011 07:14 AM PST

  • UnE near 7.5%-8% by end of 2013
  • If inflation were to soften, unemployment were to rise, this would give the Fed reasons to ease further
  • More Fed easing now gives him pause.  Trade off between employment and inflation may be different now (with more risk toward inflation).
  • 2012 growth between 2.5% and 3%

GBPUSD trends higher but runs into 38.2 retracement level. Intraday support at 1.5654-63

Posted: 20 Dec 2011 07:03 AM PST

The GBPUSD has enjoyed its own trend move higher with two legs to the upside. The last leg higher has the 1.5654 to 1.5663 area as support now.  If the price can hold above this level, the bulls remain in control and there should be futher upside potential.

Despite the bullishness, there is cause for pause as the price is testing the 38.2% of the move down from the end of October high to the low reach in December. That level comes in at the 1.5696 level. The high for the day comes in at the 1.5692 level.  This level will need to be broken to keep  the bulls happy. A failure to break could lead to more profit taking/selling as traders reevaluate the overall longer term trend.

Greek Finance minister says main choice for Greeks is Euro inclusion

Posted: 20 Dec 2011 06:59 AM PST

  • Greece should have moved on structural reform

 

Fitch says Eurozone crisis dominates global sovereign credit outlook

Posted: 20 Dec 2011 06:58 AM PST

EUR/USD bangs against key resistance level at 1.3131-37.

Posted: 20 Dec 2011 06:29 AM PST

The EURUSD is testing key topside resistance at the 1.3131-37 level. The level is the underside of a broken trendline (1.3137), the 38.2% of the trend move down (at 1.31315) and the 200 hour MA (1.3134) . For a closer look at the resistance area see chart below.

The downside support is now found at the 1.3095-03 area. This is the 38.2%/50% retracement of the last leg higher. Typically, a trend day (which is what we are seeing now), will hold support against the 38.2%/50% of the last leg higher. This is indicative of strong buying interest.

A move above the 1.3131/37 area should not be ignored.

USDCHF moves below trendline on the daily chart

Posted: 20 Dec 2011 06:22 AM PST

The USDCHF has broken below one trendline at 0.9318, but found support against bottom channel trendline support at the 0.9260 level.   The low for the day has come in at 0.9268.  Look for buyers against the level with stops on a move below. 

On the topside now, the price has some intraday retracement resistance at the 0.92897 to 0.92965 area. This is the retracement of the last leg to the downside and if the correction can hold this level, it is likely that the sellers are still in control and are looking for lower levels. 

EUR/USD triggers stops and move toward 200 hour MA/38.2% retracement

Posted: 20 Dec 2011 05:50 AM PST

The EURUSD moved above the topside channel trendline resistance at the 1.3187 level and this helped ignite stops that has pushed the EURUSD sharply higher. The pair is moving toward key target resistance at the 1.3131/35 area where the 38.2% retracement of the move down from the December 8th high to the December 14th low is found. The 200 hour MA (green line) is also in the area at the 1.3135 level currently.

I would expect that longs would be willing to take profit against the level on the 1st test.  A move above however, would be indicative of stronger overall buying and should lead to further upside momentum.

On the downside now, I will look for support against the 1.3087-98 area now. Stay above the area, and the longs/bulls remain in control.  Conversely, w move back below the 1.3087 level would not be welcomed and should lead to some further liquidation.

US Housing Starts and Building Permits Look Strong

Posted: 20 Dec 2011 05:44 AM PST

Housing Starts:    Survey: 635K    Actual: 685K    Prior: 628K    Revised: 627K

Housing Starts (MoM)%:    Survey: 1.1%    Actual: 9.3%    Prior: -0.3%    Revised: -2.9%

Building Permits:    Survey: 635K    Actual: 681K    Prior: 653K    Revised: 644K

Building Permits (MoM)%:    Survey: -1.4%    Actual:  5.7%    Prior: 10.9%    Revised: 9.3%

Risk pairs benefit from the better data. AUDUSD move above trendline resistance

Posted: 20 Dec 2011 05:43 AM PST

The better overall data in the EU and now in the US has led to a move above trendline resistance at the 1.0007 level. The next target is the 200 hour MA which comes in at the 1.0035 level. Above that the 38.2% retracement of the move down from the December 8th high comes in at the 1.0057 level.

Housing surges by 9.3%. Building Permits also surge.

Posted: 20 Dec 2011 05:35 AM PST

Housing starts rose to 685K from 627K last month. The number was the highest since April of 2010.

Multi-family units led the way as rental market improves.

Multi Family rose by 25.3% for the month
Single Family dwellings rose by 2.3%.

Versus a year ago, housing starts are up 24.3% with Multi-family dwellings increasing by 145.4%. Single family homes decreased by -1.5%.

Building Permits rose to 681K from 644K last month. This was the highest level since March 2010. Single family permits increased to 435K from 428K (a 1.6% increase), while multi-family permits increased to 246k from 216k (a 13.9% increase).

The data is a good sign. Later this week, Existing Home Sales and New Home Sales data will be released.

The dolllar declines today as better tone in the Eurozone helps the risk pairs

Posted: 20 Dec 2011 05:06 AM PST

US Building Permits & Housing Starts Data Due at 8:30

Posted: 20 Dec 2011 04:54 AM PST

NY Forex Review and Preview

Posted: 20 Dec 2011 04:35 AM PST

Stocks and Commodities

  • DJI +74
  • S&P +10.5
  • Nasdaq +16.8
  • German Dax +0.65%
  • France CAC +0.74%
  • UK FTSE -0.39%
  • China Shanghai Index -2.31%
  • Nikkei Index 0.49%
  • Gold, +$9.6
  • Oil, +$1.07

Key events and releases pre NY

  • Japan Leading Index for October rose to 92 from 91.5. The Coincident index rose to 81.4 from 90.3
  • Germany Gfk Consumer Confidence came in better at 5.6 vs 5.5 expectations (Unc from last month)
  • Germany PPI MoM came in as expected at 0.1%. YoY also was expected at 5.2%
  • Swiss Trade Balance increased to a surprising 3B vs 2B expectations (Last month was 2.16B).  However, the mix suggests slower growth as exports fell -6.8% while imports fell by a greater -7.7%
  • German IFO Business Climate rose for the second consecutive month to 107.2 from 106.6.  The 12 month low has been 106.4 in October, the 12 month high has been 115.4 in February 2011.  The Current Assesment Index came in better than expectatations at 116.7 vs 116.0, while Expectations Index also was better at 98.4 vs 97.0 estimate.
  • Spain has a successful T-bill auction. They sold 5.64  billion euros of 3 and 6 month bills. This was higher than the 4.5 target amount.   The yield fell sharply to 1.735% from 5.11% at the last auction on the 3 month bills. The 6 month bill yield also fell sharply to 2.435% from 5.227%.  
  • Canada CPI MoM 0.1% vs 0.1 expectations, Core 0.1 vs 0.1 expectations. YoY 2.9% and 2.1% core, Unchanged from last month

Key Events and Releases in NY Session

  • 8:30 AM ET, US Housing Starts, 635Kvs 628K last month
  • 8:30 AM ET, US Building Permits, 635K vs 644K last month

FXDD Scheduled Webinar’s for today 

12:30 PM ET
Talking Technicals with James Chen 
TO REGISTER: https://www1.gotomeeting.com/register/252016904

4 PM ET:
The Traders Course with Greg Michalowski.
Lesson 3: The Rules for your Forex Trading.  Join me as I continue the series with the Rules that need to be followed to satisfy your trading mission. 
TO REGISTER: https://www1.gotomeeting.com/register/710590145

Canadian CPI (m/m) 0.1% vs. 0.2% forecast.

Posted: 20 Dec 2011 04:06 AM PST

Core CPI also 0.1%.

Fitch says that the AAA rating of the EFSF depends on France remaining AAA rated.

Posted: 20 Dec 2011 03:32 AM PST

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