Archive for the 'Market Bytes' Category

Asia Session

The US Dollar gained on the Yen and some temporary gains on the Euro before pretty much marking time for the rest of the session. With Japan’s Nikkei 225 up for the 9the consecutive session, news that the Japanese Government would be more than likely abolish the 40% capital gains tax for (CGT) that foreigners pay when holding Japanese companies in funds this year.

USD/JPY was up from a early low of 93.26 to reach a high of 94.13 before falling a little to finish the session around the 94.00 level.

EUR/JPY was busier, hitting a 125.78 low and breaking a 27.00 high. 

EUR/USD fell back down to around 1.3431 but climbed back up to a high of about 1.3540, before retracing to about the 1.3500 level as we approached the London session.

It seems that Obama’s plan for economy stimulous has given the US dollar some strength, but we are not sure how long this elation will be hanging around.  Things don’t get better over night.

In the London session there will be data including German employment and the Euro Zone PPI figures.

New York Session

The dollar fell back during the New York session after some poor economic data from the US and the FOMC meeting minutes didn’t help as they were to the point. The ISM services index came in a little better but still at a poor 40.6 for December, after a 37.3 figure for November. Factory orders for November were worse at -4.6% key capital expenditure gave a revised GDP to a terrible 3-month annual rate of -28.0%. News that pending home sales were -4.0% in November doesnt’t paint a good picture for Q1 2009.

Then the FOMC meeting minutes added to the woe, with its members reminding everyone of the significant downside risks to US economic growth, whilst confirming continued lowering of inflation, and some members saying this contraction in activity will be rather prolonged.  Seeing as the Fed can’t really reduce rates from zero (!), it just leaves the option of pumping even more cash in to the very troubled US economy.

EUR/USD ran up some +200 pips as the New York session kicked off and was up at around the 1.3530 level as the session closed. The next resistence looks to be the 1.3570/80 level, which is a trend break. This would see a target of around 1.3650.

GBP/USD had a even better run, up some +350 pips to the 1.4920/30 area, even hitting a high of near 1.50 level, with that being a significant break if it occurs. Don’t forget that the Bank of England meets later this week and further cuts in UK interest rates could be on the cards.

London Session

It was almsot like yesterday repeated, with the €uro taking a bit of a hammering again. With the eurozone consumer price estimate for December coming out just below expectations at 1.6%, down from the 2.1% figure for November. We can expect more ECB interest rate cuts this month, we think, with inflation worries moving to a less important position.

EUR/USD was smashed some -150 pips during the London session, settling at around the 1.3310/20 level by the time New York was getting ready for kick off. If we break 1.3250 level expect some more downside. 

EUR/JPY was also lower, down more than -70 pips towards the 1.2520/30 level. 

The price of the black stuff continued up, breaking the US$50 bbl level.  This caused USD/CAD to fall off some -80 pips to around the 1.1890 level.  We see a break of 1.1820 being an important level.  Tension in the Israel/Gaza region also adding to concerns, but be careful the price doesn’t fall back again fairly swiftly if all the problems subside and clam down.

Asia Session

It was fairly quiet in Asia early doors, especially after such moves during the London & New York sessions, but then the US dollar set off again. The 100 pip channel was breached when the EUR/USD fell from around the 1.3610 level to around 1.3500 in under an hour. The dollar still looking attarctive on the back of Obama’s US$775 bln stimulous package. The Italian Bond ‘fiasco’ probably didn’t help the €uro, either.

GBP/USD did similar, falling from the session high of around 1.4722 to hit a low of 1.4570, with EUR/GBP remaining failry steady between 0.9291 and 0.9255 after the big fall yesterday.

EUR/JPY saw big falls from the early highs of 127.40 to a low later in the day around 125.75.  This in effect neutralised the moves in USD/JPY, which was fairly downbeat but quiet, falling from an early high of 93.58 to a low of about 92.85.  It ended the session around the 93.10 level.

There is some UK & Euro zone data out today, so be careful.  This includes the PMI composite and consumer price estimate.

New York Session

The US dollar was lower against most of the big pairs in New York trading, this after the stock fell back and some poor economic data, helped some big technical level and set up breaks. On the stock market the S&P 500 fell about -0.5%, which was helped by a reported weak November construction spending report, coupled with very poor auto vehicle sales for December.

EUR/USD was up over 50 pips, sitting near the 1.3610/20 level by the time the session was nearing its end. A break up of 1.3650 will see further upside, we feel.

GBP/USD did better and was up over 200 pips around the 1.4710/20 zone.

On to the black stuff, where we seem to have well and truly come off the floor.  Oil was up over 5% to trying to get through the massive US$50 bbl level. Current trouble in the middle East, namely Israel/Gaza, was causing tensions and concerns in the oil market.  This caused the London rise in USD/CAD to be reversed, with a -230 pip fallback to around the 1.1870 level, which was an intraday low, by the time the session came to a close.  A break of the 1.20 level appears to be a massive break. If we break back above a long trade would be on the cards for us.

Happy Trading.

London Session

- 2 Live Room trade calls today; 1 big win and 1 closed at breakeven.
- Currently looking at USD/CAD as a possible intra-day trading opportunity.

EUR/USD – Short Call

- Live Room Call: Entry on the break of 1.3838
- Trade: Break of support level
- 1st Level: 1.3772, +66 (full position)
- Stop: 1.3863
- (Allow few pips for slippage on entry/exit levels)

USD/CAD – Long Call

- Live Room Call: Entry on the break of 1.2178
- Trade: Break of resistance level
- 1st Level: 1.2178, +0 (full position)
- Stop: 1.2153
- (Allow few pips for slippage on entry/exit levels)

Intra-day trades

USD/CAD - Short trade closed (+135 pips)

Open Short: USD/CAD @ 1.2015
Stop level: 1.2125-30 region
Target level: 1.1870
Closed: 1.1880 (+135 pips)
Close to target

AUD/USD - Long trade closed (+0 pips)
Open Long: AUD/USD @ 0.7162
Stop level: 0.7050
Target level: 0.7280
Closed: 0.7162 (+0 pips)

That’s +201 pips in one day from called trades, and doesn’t count the level breaks sent out early this morning that would have netted 100s more during the London session.

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London Session

After what looked like a quiet start, the London session became a place to make some cash, which we managed in the Live Room.  One or two guys made even more as they took a long USD/CHF trade.  The dollar looked strong this morning. The news that Obama may be giving some US$310 bln in tax cuts, which is part of a US$775 bln stimulous package, saw the dollar become attractive. This level of input to the US economy could, and probably would see the US recover quicker than other world economies.

EUR/USD got hammered.  Battered.  A -350 pip fall was a lovely trade, with the marketbytes level call broken early on its fall at 1.3838.  It continued down to the 1.3580 area.

GBP/USD didn’t do so bad.  About a -35 pip fall towards the 1.4510 level was probably down to the UK construction PMI figure, which came in at a weaker than expected 29.3 for December, down from a 31.8 figure for November.

The yen pairs showed reaction to €uro weakness and US dollar strength.  USD/JPY leapt about +140 pips towards 93.40/50 zone, whilst the EUR/JPY fell back a similar amount, down -120 pips into the 126.90/95 zone.

Nice trading, all the same.

Asia Session

We think the stockmarkets are having some positive action due to the US Presidency change, with Obama bringing in some of his own policies, which are expected to be positive.

Forex trading is picking up volume again today, with normality returning after the Festive holiday season.

EUR/USD jumped, peaking at 1.3941 before falling a full cent to 1.3841, then levelled off around the 1.3890 level towards the end of the Asian session.

EUR/JPY also rose, with a high around 128.55 before falling back to around 127.35, then pulling up again to 127.90 at the end of the session.

Note that Euro Zone GDP is due later this week, on Thursday, so be ready for some decetn action then.  But be careful.

USD/JPY didn’t do much today during the Asian session, staying around the 91.90 level, channeling along in a 20-25 pip range.

AUD did well, up to a 3-month high against USD, opened up 20 pips at 0.7115, then ran up to a high of 0.7163, then pulled back to 0.7140 as the Asian session closed.

<strong>London Session</strong>

It was a fairly active session today despite volume still being then. The stock markets were doing well all around the globe as well, being up some 2% so far in Europe.  This despite economic data released being fairly poor, with Eurozone PMI manufacturing down to 33.9 in December, down from 34.5, which was worse than expected.

<strong>EUR/USD</strong> was up, though, ignoring all that, and fighting back from the fall last night. It was trading near 1.3930, up 30 pips by the time New York was getting ready for kick off. The 1.3880 level looks like the short-term support level, with a break of this seeing more downside. A break of 1.38 would see some volatile trading.

The yen wasn’t as busy. <strong>USD/JPY</strong> was fairly even during the session and stayed just above the 91.00 level. This looks a strong support.  A break of 91.50 on the upside would be seen as a break.

<strong>EUR/JPY</strong> was up about 20 pips during the session, hovering at the 127.00 level.

<strong>USD/CAD</strong> fell over -70 pips towards the 1.2190 level, even with the price of the black stuff pulling back. Oil was just under the US$42 bbl level, but there was feeling that the jump on Wednesday was a bit much for one day. We see the US dollar gaining more, and a break of the 1.2280/90 level woudl see more upside.

Asia Session

Welcome to 2009!

The New Year kicked off in the Far East with trading aimed at weakening the Euro. The upcoming PMI manufacturing data is expected to show Europe is suffering somewhat, and that the recession deepens. Not a good celebration for 10 years of the Euro currency, and also that Slovakia joined the ranks of the Euro today, making it the 16th member.

The EUR/USD kicked off around the 1.4000, then ran to 1.4027 before the big drop occurred, with the pair falling 180 pips from there to a 1.3850 low. The PMI data will be released in stages over 10mins this morning from France, Germany and then Euro Zone, starting with the French at 08:50 Lodnon time.  Poor news and further interest rate cuts are expected.

GBP opened up a little, then dropped from its 1.4764 high to near the 1.4615 area. as sellers swooped in to take advantage of the higher levels.  EUR/GBP fell from 0.9427 from a high of 0.9590 during the Asian session.

USD/JPY pushed higher from around 90.62 to up near 91.17 as the US Dollar opened the year with some stregnth. 

Other Dollar pairs saw the Aussie fall from 0.7040 to 0.6940 and the USD/CHF lifting from 1.0623 to just over 1.0770.

We feel the dollar strength will weaken, though, as interst rates at 0% to 0.25% don’t attract investors.