Forex Note Trading Blog

Forex Signal January 3rd 2007

2008-01-02T20:49:00.000-08:00

1. Thursday, January 3rd, 2008 (8:15 a.m. New York Time) USAAt 8:15 a.m. New York time we will have U.S. ADP Employment Change. That is expected to come out at 47.5 K, and I see 33K expected from another source so that numbers may change as we are approaching to the report. Last month it came out at 189K, and it was a great trade. To be safe, a reading of -20K or more negative would be weakening the U.S. dollar in general. A reading of 100K or higher would be strengthening the U.S. dollar. I would trade this on USD/JPY. I would look to buy USD/JPY on reading of 100K or higher, and sell USD/JPY on a reading of -20K or more negative. 2. Thursday, January 3rd, 2008 (8:30 a.m. New York Time) USAThen at 8:30 a.m. New York time we will have U.S. Unemployment Claims which is expected to come out at 345K. It is a weekly indicator and recently more people are focused on it. If it comes out at 360K or higher, that should be weakening for the dollar, and it would constitute a sell signal on USD/JPY, good for 15 to 40 pips. If it comes out at 330K or lower, it would be strengthening the U.S. dollar, and it would be a buy signal on USD/JPY, good for 15 to 40 pips

Forex Trading Signal December 17th 2007

2007-12-16T16:31:00.000-08:00

Hai all we review what happened on Friday December 14th. Last we had U.S. CPI coming out. It was expected to come out at 0.2%. It came out at 0.3% which hit our sell signal. And already on down trend as GBP/USD moved down a lot before the report. At the report, the price moved from 2.0271 down to 2.0218 so it moved around 50 pips immediately.

And now Monday, December 17th, 2007 (8:30 a.m. New York Time) USAAt 8:30 a.m we will have U.S. Empire State Business Conditions Index and U.S. Current Account. Because they are coming at the same time, it is hard to say which one is going to grab the market. Most likely Empire Manufactures is more important one, and usually when it is in focus by itself a deviation of 10 or 12 can be tradable but I would skip that one.3.

At 9:00 a.m. New York Time USAAt 9:00 a.m there's U.S. TIC Net Long-Term Transactions. This indicator used to work, then it did not work, and past 3 months it started working again because of very large deviations. It is expected to come out at 49 B. If it comes out at 0 or negative, I would look to sell USD/JPY, and if it comes out at 100 K or more positive, I would buy USD/JPY. This is one of the financial health indicators so I think USD/JPY should work better on this one.

And last at 1:00 p.m. New York Time USAAt 1:00 p.m. we will have U.S. NAHB Housing Market Index. This almost never move the market but if you trade on your own around a lunch time, keep an eye on it, especially if deviation is above.

From any source. Happiness trading!!!

Wednesday, December 05th, 2007 (3:00 p.m. New York Time)

2007-12-04T13:41:00.000-08:00

New Zealand: Interest Rate Statement coming out. It is expected they will keep the rate unchanged, and start cutting rates towards first quarter of 2008. If they drop their dovish tone, and talk about possibility to do more hikes, then NZD/USD may possibly gain 100 pips or more in the first 3 hours of the report. On the other hand, if they say need to cut the rates quicker than it was thought previously, NZD/USD may possibly go down by 50 pips or more in the first hour of the report. If there are no comments, or comments are the same or neutral, then it is a no trade here.

Wednesday, December 05th, 2007 (8:15 a.m. New York Time) USA

2007-12-04T13:40:00.000-08:00

At 8:15 a.m. New York time: U.S. ADP Non-Farm Employment. It is expected to read at 50,000 versus 106 K last month. If it reads at 0 or negative, I think GBP/USD may possibly go up by 40 pips or more in the first 30 minutes of the report simply because it would be a negative reading for the U.S. dollar. On the other hand, if we see a reading of 100 or above then we may see GBP/USD going down by 40 pips or more in the first 30 minutes of the report. SUMMARY:* Report: ADP Non-Farm Employment* Buy on GBP/USD if the number will be 0 or negative* Sell on GBP/USD if the number will be 100 or more* If the trigger is hit, expect 40 pips or more in the first 30 minutes of the report

Wednesday, December 05th, 2007 (4:30 a.m. New York Time) UK

2007-12-04T13:39:00.001-08:00

At 4:30 a.m: UK Services PMI. I think this indicator is worth watching and possibly trading. It is expected to come out at 52.7. If it reads at 55 or higher, I think GBP/USD may possibly gain 40 pips or more in the first hour of the report. On the other hand, if this indicator reads at 50.5 or below, I think GBP/USD may possibly go down by 40 pips or more in the first hour of the report. Report: UK Services PMI* Buy on GBP/USD if the number will be 55.0 or higher* Sell on GBP/USD if the number will be 50.5 or lower* If the trigger is hit, expect 40 pips or more in the first hour of the report.

Tuesday, December 04th, 2007 (7:30 p.m. New York Time) AUSTRALIA

2007-12-04T13:38:00.001-08:00

At 7:30 p.m. we will have Australian GDP. It is expected to read 1%. If it reads at 1.3% or higher, AUD/USD may possibly go up by 40 pips or more in the first hour of the report. On the other hand, if the reading is 0.7% or less, I think AUD/USD may possibly go down by 40 pips or more in the first hour of the report.
* Report: Australian GDP* Buy on AUD/USD if the number will be 1.3% or higher* Sell on AUD/USD if the number will be 0.7% or lower* If the trigger is hit, expect 40 pips or more in the first hour of the report.

Tuesday, December 04th, 2007 (5:30 p.m. New York Time) AUSTRALIAAt 5:30 PM

2007-12-04T13:36:00.000-08:00

Interest Statement coming out of Australia. It is expected they are going to keep the rate unchanged, and most likely there will be no comments so most likely nothing is going to happen here. If there are some comments towards rate hikes, AUD/USD may possibly gain 50 pips or more in the first hour of the report. If there are comments towards future rate curs, AUD/USD may possibly lose 50 pips or more in the first hour of the report. As I said, most likely nothing will happen.

Loosing in Forex??

2007-11-13T11:39:00.000-08:00

Why? Ask Yourself. Just That

Report: U.S. Non-Farm Payroll Nov 2nd 2007

2007-11-02T01:16:00.000-07:00

Today is Nov 2 2007. US Non-Farm Payroll will come. OK are your ready? As far as the NFP goes, let me see the our discussion:

FOREXFACTORY
By NewstraderFX, Yesterday 8:08pm, Topic Economic Indicators

## First-forget about predicting the reaction because it's impossible to do. A good NFP with upward revisions indicates the economy is still OK (equity/carry trade +), but it also indicates the fed is less likely to cut (equity/carry trade -). A weak NFP with downward revisions indicates the economy may be in trouble (equity/carry trade -) but it also indicates the fed may reduce rates further (equity/carry trade +). And to add to the difficulties, what would happen if the headline is up and the revisions are down or vice versa? Hmmm.... The good news is that you don't need to guess what the reaction will be, you can look at two important markets that will tell you. The S&P and 10 year bond futures contract s for December will be very helpful in this regard. The NFP is being released one hour before Wall Street opens and that will give plenty of time to see what traders think of the numbers by looking at how these two market-indicating futures contracts react. If they like what they see, the S&P futures will be bought and the 10 year bond futures will be sold. That indicates a positive day for equities and carry trade pairs. GBP/JPY will appreciate as the dollar gains on the Yen and loses vs. the Pound. The reverse will happen if they don't like what they see. There's other news tomorrow and there are a few second tier profit reports. There could be some analyst calls, so that's something to be aware of also. (BTW-I think they should have an official schedule of calls for these analysts. Seems a bit unfair to me the way it's done now). So check out my room and watch the markets react. It's only ten bucks a week and you can cancel at any time-which is a pretty good low risk investment. My blog is here: thenewstraderfx.blogspot.com and you can contact me with any questions ##

_________________
OK, at 8:30 a.m. New York time we will have U.S. Non-Farm Payroll coming out. It is expected to come out at 82 K. If it reads 120 K or more (see forexfactory.com). I will do this:

- Sell on GBP/USD if the number will be 120 K or more
- Buy on GBP/USD if the number will be 40 K or worse- Expect 50 pips or more in the 30 minutes of the report.

ADD
DO NOT FORGET THIS MOMENT BEFORE
At 7 a.m. New York time we will have Canadian Employment Change. It is expected to read about 12 K versus 51.1 K last month. I will do this:

- Buy on USD/CAD if the number will be 0 or negative
- Sell on USD/CAD if the number will be 30 K or higher

Success face NFP, make some money tomorrow. Have a nice day and thank you very much.

Commentary by Brian Dolan Chief Currency Strategist

2007-10-27T17:44:00.000-07:00

by Brian Dolan, Chief Currency Strategist

The US dollar lost further ground this week as the G7 failed to make any reference to USD weakness/EUR strength and incoming housing data highlighted only bleakness. Tellingly, the only time the USD experienced any strength was on Monday when a larger than expected write-off by Merrill Lynch triggered a stock market sell-off, which sent JPY-crosses (carry trades) plunging. The collapse in the JPY-crosses spilled into the USD pairs, triggering stop loss selling of the non-JPY dollar pairs (EUR/USD, GBP/USD, and AUD/USD, buying of USD/CAD). In other words, only an abrupt market dislocation sparked USD-buying, which only serves to highlight the lack of support for the USD from any fundamental source.

That hiccup also serves to highlight the primary risk to expectations for a steadily falling USD: extremely high levels of USD-short positioning. Going forward, traders need to keep in mind how short of USD the market is and how profit-taking will continually emerge on fresh USD lows. Selling USD on bounces against all but the JPY remains the preferred strategy going forward, but profits should also be taken on subsequent USD declines. Overall, markets remain on edge, with on-going credit market surprises likely to continue popping up, roiling an otherwise gradual decline in the greenback.

Interest rate futures markets went one step further beyond pricing in 1/4% Fed rate cut next Wed. and began to price in chances of a 1/2% rate cut. As of Friday afternoon, Fed fund futures indicated a 90% likelihood of a 25 bp cut, and 10% for a 50 bp cut. On the fundamental side, there remains a remote possibility that the Fed decides to hold rates steady next Wed., an outcome that would be catastrophic for US equities and carry trades. Prior to the housing data that started in mid-Oct., US economic reports since the Fed's Sept 18 rate cut were largely upbeat, which as recently as Oct. 12 resulted in market expectations of a 90% probability that the Fed would hold steady in Oct. If the Fed takes the longer-term view and looks beyond recent housing data, believing it got out ahead of the curve with the 50 bps in Sept., it may decide to wait for additional information before making further adjustments. Sharp gains in oil and other commodities point to rising inflationary pressures, which could be used as additional justification to hold off until the picture is clearer. I'm inclined to favor a 1/4 point cut as the most likely outcome, which would allow the Fed to say they're taking steps to support growth without being seen as completely ignoring inflation or bailing out investors. If the Fed only cuts by 25 bps., the USD is likely to see a brief sell-off, followed by profit-taking ahead of Friday's NFP report. A 50 bp. rate cut is likely to result in much heavier USD selling as well as a euphoric equity market rally, which would then see JPY-crosses sky rocket. A steady rate decision is the Black Swan, which would see US equities plummet alongside JPY-crosses, and spark a very ugly round of USD short-covering.
The very high positive correlation between equity markets and JPY-crosses remained intact, but the overall stock market outlook remains hampered by 3Q earnings surprises, lingering economic concerns, and surging oil prices. This led to a choppy week for both stocks and carry trades, which should continue next week. Absent outright equity market strength, USD/JPY has had a lid kept on it, preventing the carry trade from returning in full force. Next week, the Bank of Japan will hold an interest rate setting meeting, and expectations remains for no change in Japanese benchmark rates, suggesting fresh JPY-weakness across the board may be the result. USD/JPY is also facing technical resistance in the form of Ichimoku cloud resistance, which very neatly capped the upside over the past week. The base of the cloud begins to rise from Friday's 114.63 level to 114.90-115.03 for next week, with further rises to 116.40/50 by mid-Nov. A daily close above the base of the cloud suggests a more aggressive attempt to rally to the top of the cloud, which will be at 117.00-10 next week, and potentially break out above it, signaling an overall shift to an uptrend. USD/JPY upside potential remains favored while above last Monday's 113.25/30 spike reversal low.

Turning to the data/event calendars, it's the end of the month/beginning of the new month and data will be heavy. US data starts on Tuesday with the Aug. S&P/CS home price index, which is expected to show a further YoY decline in US home prices, and the Conference Board's October consumer confidence reading. Wednesday sees weekly mortgage application data, ADP national employment report, 3Q advance GDP estimates, which are expected to be solid in the 3.0-3.5% area, Oct. Chicago PMI and Sept. construction spending. The main event will come on Wednesday afternoon when the FOMC rate announcement is expected at 1415EDT/1815GMT. Thursday sees Sept. personal spending and income, Sept. PCE inflation, weekly jobless claims, and Oct ISM manufacturing. Friday sees October NFP data, with expectations currently centered on a NFP gain of +80K and a steady unemployment rate of 4.7%. No Fed speakers are scheduled next week and US Treasury Sec. Paulson will be in India attending a conference.

Eurozone data kicks off with preliminary Oct. German CPI on Monday. Tuesday sees German Oct. unemployment data and a series of Eurozone retail PMI's. Wednesday sees Sept. German retail sales, Oct. Eurozone consumer and industrial confidence reports, and Oct. Eurozone CPI estimate. Thursday has no data of note. Friday finishes out with Oct. Eurozone manufacturing PMI's.

Japanese data begins on Monday morning Tokyo-time with Sept. retail trade and large retailers sales. Tuesday morning sees Sept. employment data and household spending, followed by Oct. small business confidence in the afternoon. The BOJ MPC meeting will begin on Wednesday morning and the decision is expected to be announced later Wednesday afternoon. Sept. labor cash earnings, overtime earnings, and Sept. construction orders are the data of note on Wednesday.

UK data sees final Sept. money supply data to start on Monday. Wednesday sees Oct. Nationwide building society house price gauges and Oct GfK consumer confidence. Thursday sees Oct. manufacturing PMI and Oct. CBI distributive trades report, a private measure of retail sales. Friday finishes out with the Oct. construction PMI. BOE MPC member Blanchflower, the lone dissenter to the steady rate decision at the beginning of Oct. favoring an ease, will speak on Tuesday evening UK time from Manchester.

Source: http://www.forex.com/forex-newsletter.html?utm_source=forex&utm_medium=newsletter&utm_content=commentary_fulltext&utm_campaign=weekahead

USD Slumps on Data

2007-09-25T12:03:00.000-07:00

by Korman Tam9/25/2007 2:00:00 PM

The dollar was dragged lower in the Tuesday session on the heels of lackluster US economic reports, plunging to a new record low versus the euro at 1.4154 and again falling to parity against the Loonie. We expect the greenback to remain under pressure over the coming months amid persistent worries that the US economy may slump into recession and the increased prospects for additional rate cuts from the FOMC.The data released earlier in the session reinforced the pessimism surrounding the US economy, with consumer confidence and housing reports pointing toward further weakness. The Conference Board's consumer confidence index tumbled to its lowest level in nearly 2-years, at 99.8 for September down sharply from August at 105.6. The dismal confidence figure reflects heightened market volatility, growing uncertainties stemming from the housing market and worries over the prospects of a US recession. There was also renewed evidence of the slumping housing market with existing home sales down 4.3% at 5.49 million units, versus 5.75 million units in July. Euro Climbs to Record High

( More.. ) Read the rest of this article at Forexnews.com
This article contains the following sections: Euro Climbs to Record High
Full article available at Forexnews.com

Dollar Weakened to 1.41 vs Euro

2007-09-20T14:03:00.000-07:00

Yan Xu9/20/2007 4:15:00 PM

The dollar extended its loss against its major rivals today on speculations that the Fed may continue to lower fed fund rates in the rest of the year. The euro touched 1.41 versus the dollar, while the yen strengthened to as low as 114 against the dollar. The dollar index fell to an all-time low at 75.73 yesterday. Interest-rate futures pricing indicated traders see an 80 percent chance that the Fed may cut a quarter-percentage point to 4.50% on its policy meeting at the end of October. In the early session, US weekly jobless claims fell 9k to 311k, beating the estimate of 321k. Philadelphia Fed business conditions index dropped from 0.4% to minus 0.6% in August, below the estimate of minus 0.2%.( More.. )

Read the rest of this article at Forexnews.com

This article contains the following sections: CAD Reached Parity with USD

Full article available at Forexnews.com

US dollar took a pounding after Friday's NFP report

2007-09-10T17:28:00.000-07:00

The US dollar took a pounding after Friday's NFP report indicated a loss of -4K jobs in the month of August. Revisions to June and July were also negative, compounding the appearance that the US economy is tipping over, weighted down by ongoing real estate declines, higher consumer lending rates and tighter lending conditions. Street analysts are back flipping over themselves to forecast how aggressively the Fed will cut rates at its Sept. 18 meeting, with futures markets pricing in a 75% chance of a 1/2% rate cut as of Friday. However, I would suggest the situation is not as clear cut as the market consensus seems to expect.

Greenback Extended Loss

2007-09-10T17:23:00.000-07:00

by Yan Xu

The greenback extended loss on Monday as the overall sentiment on US economy turned to be deteriorating after the Labor Department reported a surprising decline in non-farm payrolls.

The negative job report reinforced the expectation that the Fed will cut interest rates next week to avoid economy recession. Interest-rate futures showed traders priced in a 76 percent chance that the Fed will cut interest rates by 50 basis points to 4.75% at its September 18 policy meeting.

The euro hovers around the 1.38 level versus the dollar, while the sterling approached 2.0330 against the dollar. The dollar index fell to 79.826 today, the lowest since 1992.

The yen strengthened to 112.60 versus the dollar but pared gains after a report showed Japan GDP fell 0.3% in the second quarter. It is already widely expected that the Bank of Japan is going to maintain its interest rates at the lowest level among all industrial countries at least by the end of this year. When the central bank will lift its rates above 0.5% is not a major topic in the market now. The yen may continue its strength against high-yielding currencies if risk aversion keeps rising on credit crunch.

Tomorrow will see US international trade deficit, which is expected to increase from 58.14 billion to 59 billion in July.

EURUSD will face interim resistance at 1.38, followed by 1.3830 and 1.3850. Additional ceilings will emerge at 1.3880, backed by 1.39. Support starts at 1.3770, backed by 1.3750, 1.3730 and 1.37. Subsequent floors are eyed at 1.3650.

GBPUSD encounters interim resistance at 2.03, backed by 2.0330 and 2.0350. Subsequent ceilings will emerge at 2.0380, followed by 2.04 and 2.0430. On the downside, support begins at 2.0250, followed by 2.02 and 2.0170. Additional floors are eyed at 2.0140, backed by 2.01 and 2.0080.

USDJPY encounters interim resistance at 114, backed by 114.30 and 114.50. Subsequent ceilings will emerge at 114.80, followed by 115 and 115.30. On the downside, support begins at 113.50 and 113.30, followed by 113. Additional floors are eyed at 112.60, backed by 112.30 and 112.

Yen Dropped as US Stocks Rose

2007-09-04T17:30:00.000-07:00

by Yan Xu
9/4/2007 4:50:00 PM

Read Full Article

The yen dropped versus high-yielding currencies as US stocks rose with boost from technology sector.

The S&P 500 index climbed more than 1 percent, and the Dow Jones industrial average gained more than 100 points. Strong US equities performance today helped investors pick up confidence in carry trades. The dollar edged up to 116.40 versus the yen, while the sterling rallied 250 pips against the yen.

US August manufacturing ISM fell from 53.8 to 52.9 in August as expected. A reading above 50 indicates an expansion in manufacturing sector, raising speculations that the nation¡¯s economic growth is more likely to slow down gradually rather than deteriorating. ( More.. )

Read the rest of this article at Forexnews.com

This article contains the following sections:

Full article available at Forexnews.com

Commentary : Brian Dolan, Chief Currency Strategist

2007-08-31T19:39:00.000-07:00

Major currencies spent another week see-sawing in relatively wide ranges as markets continue to assess the fallout from the sub-prime mortgage meltdown and its aftershocks. The USD (in US dollar index terms) looks set to finish out the week mostly unchanged, while stock markets survived a mid-week sell-off and look set to post modest gains on the week. However, judging by the S&P 500 index, stocks appear unable to surpass last week's highs at 1480 and this could be a bearish sign for stocks to start the new month. (Please note, this report was prepared around noon EDT Friday, without the benefit of weekly closing price levels.) A similar weekly price pattern is evident in the JPY-crosses, with 159.60/70 in EUR/JPY serving as the key weekly high. In short, what I'm seeing on the charts is that stock markets and carry trades (JPY-crosses) have stabilized further, but are unable to extend the correction higher. In market terms, buyers continued to emerge on dips, but they've either run out of steam at the weekly highs, or sellers are in abundance there, or a combination of both. In general, that keeps the downside in focus. I would also note that equity market volumes were extremely light in the past week, making the attempts to rally even more suspect.

Next week's price action, whether the weekly highs in stock and JPY-crosses can be taken out or if the sell-off resumes, will be a critical determinant of market trends likely going into the end of the year. I expect September to kick off with a bang and keep going from there. Keep in mind that... Full text »

Economic Calendar for week 27th - 31th August 2007

2007-08-27T17:49:00.000-07:00

Economic Calendar for week 27th - 31th August 2007.

All times GMT
Monday Aug 27th:
UK - ALL DAY - Bank Holiday .
EU - 14:00 - ECB President Trichet Speaks
USD - 15:00 - Existing Home Sales

Tuesday August 28th:
EU - 09:00 - German Ifo Business Climate Index .
EU - 09:00 - German Ifo Business Expectations Index
EU - 09:00 - M3 Money Supply y/y
UK - 09:30 - BBA Mortgage Approvals
US - 15:00 - Consumer Confidence
US - 15:00 - Richmond Fed Index
EU - Tentative - German CPI M/M (p)
US - 19:00 - FOMC Meeting Minutes

Wednesday August 29th:

EU - 07:00 - German Consumer Confidence
US - 15:30 - Crude Oil Inventories

Thursday August 30th:

UK - 07:00am - Nationwide House Prices M/M
EU - 08:55 - German Unemployment Rate
EU - 09:00 - Italian Retail Sales M/M
UK - 09:30 - Mortgage Approvals
UK - 09:30 - Net Lending to Individuals M/M
UK - 11:00 - CBI Distributive Trades Realized
US - 13:30 - GDP Annualized q/q (r)
US - 13:30 - GDP Deflator Annualized q/q (r)
US - 13:30 - Unemployment Claims
US - 15:00 - House Price Index q/q

Friday August 31st:

EU - 07:00 - German Retail Sales M/M
EU - 10:00 - CPI y/y (p)
EU - 10:00 - Unemployment Rate
EU - 10:00 - Italian CPI m/m
EU - 10:00 - Consumer Confidence
UK - 10:30 - Consumer Confidence
US - 13:30 - Core PCE Price Index M/M
US - 13:30 - Personal Spending M/M
US - 13:30 - Personal Income M/M
US - 14:45- Chicago PMI
US - 15:00 - Factory Orders M/M
US - 15:00 - Consumer Sentiment (r)
US - 15:00 - Fed Chairman Bernanke Speaks

EU - Europe wide
FR - France
UK - United Kingdom
US - United States
GE - Germany

The week ahead.
Let The Bailouts Begin
The mortgage industry finally received some reprieve last week when the Bank of America invested 2 billion dollars into the ailing mortgage lender Countrywide Financial.
Although this caused some upbeat momentum, it was short lived, as credit worries still continue to plague the market. On August 17th the Fed Bank cut its lending rate by .50bp, which resulted in the market jumping 230 points on the Dow Jones.
The stock market had some follow through this week, closing up or flat, for the first three days. However it seems like the moment there is any hint of credit crunch; the market gives back all gains. There is major speculation that unless the FOMC doesn't cut rates, then as soon as the next major set of bad news comes around, the market will potentially give back everything they gained from the fed cut and then some
Next week we are going to get a sneak peak into the consumer's financial health. With consumer spending data being released, The Consumer Confidence report is on Tuesday and Personal Spending and Personal Income on Friday.
Both reports could possibly be market moving, ! as the market has been focusing its spotlight of attention on the credit of consumers. Also on Monday there is existing home sales figures, which with the credit market drying up, would probably be down. With little possibility of good news the outlook for the near future seems to be Bearish-Neutral.
A no touch play on the SP500 to the upside with 100 pts from the spot with a 20 day duration returns an 11% ROI.
Arthur Smelyansky
Want to learn more? Get daily market analysis at www.MarketExcellence.co.uk

FX Quiet, Carry Trades Pick Up Slowlyby

2007-08-27T17:42:00.000-07:00

Major currency pairs were trading quietly on Monday as UK financial market was closed for summer bank holiday. The dollar remained weak against the euro and sterling after a weaker-than-expected US housing report, adding to the worries over the nation's housing sector. The existing home sales declined 0.2% to an annual rate of 5.75 million units in July, the slowest pace in two years. The euro drifted in a narrow range between 1.3640 and 1.3680 versus the dollar, while the sterling approached 2.02 against the dollar.

( More.. ) Read the rest of this article at Forexnews.com

This article contains the following sections:

Full article available at Forexnews.com ____________________________________________________________

Yen Fell as Risk Appetite Returns

2007-08-22T16:03:00.000-07:00

by Yan Xu

The yen fell broadly as global financial market calmed down and investors resumed risk appetite. As carry trade positions are rebuild, the yen weakened against high-yielding currencies. The dollar climbed from 114 to test 115.50 versus the yen. The sterling rallied sharply to near 230 against the yen, while the euro approached the 156 level.

The Bank of Japan is widely expected to hold its interest rates unchanged at current low level of 0.5% on its policy meeting this week. This will raise investors' interests in carry trades.

The European Central Bank planned to inject 40 billion euros to the banking system to facilitate liquidity needs, easing worries over credit market. ( More.. )

Read the rest of this article at Forexnews.com

Yen Choppiness Resumes

2007-08-19T20:53:00.000-07:00

by Korman Tam8/19/2007 10:50:00 PM

Read Full Article

At 4:30 AM UK July PS net borrowing (exp -6.1 bln sterling, prev 7.443 bln sterling)UK July PSNCR m/m (exp -11.0 bln sterling, prev 10.339 bln sterling)At 10:00 AM US July Leading Indicators (exp 0.4%, prev -0.3%)The foreign exchange market remained volatile in early Tokyo trading, with the yen pairs leading the movement amid lingering risk aversion. Although last week's 50-basis point cut in the Fed's discount rate tempered growing fears of a credit crunch and its impact on the economy, traders will remain cautious as it remains uncertain whether the FOMC will cut the Fed fund rate next month.

The major currencies rebounded against the yen on Friday and continue to hover around those ranges, with dollar/yen near 114.20 and euro/dollar steady just beneath the 1.35-level. The week ahead is light on key economic data, but some highlights include the Bank of Japan's monetary policy decision, Japan's trade balance, Germany's ZEW survey, Germany's GDP, UK GDP and US durable goods orders. However, the currency market will likely take its cues from the credit and equity markets. ( More.. ) Read the rest of this article at Forexnews.com

Greenback Rose on Heightened Risk Aversion

2007-08-15T14:34:00.000-07:00

by Yan Xu8/15/2007 4:10:00 PMRead Full Article

The unwinding of carry trades continues to dominate the foreign exchange market. The greenback strengthened as investment capitals flow back to safe haven amid the heightened risk aversion. The euro fell another 100 pips today to as low as 1.3450 versus the dollar. The market shrugged off economic data as all the eyes were on risk aversion. US CPI rose 0.1% in July, leading to a year-on-year rate down from 2.7% to 2.4% as expected. Excluding food and energy, core CPI rose 0.2% as expected. New York Fed manufacturing survey fell slightly from 26.46 to 25.06 in August, above the estimate of 18.5. US Treasury reported net foreign purchases of long-term securities for June were 120.9 billion, double the forecast of 65 billion. US industrial production increased 0.6% in July, beating the estimate of 0.3% and a reading of 0.5% in the earlier month. US capacity utilization was barely changed at 81.9% in July. The National Association of Home Builders/Wells Fargo sentiment index declined from 24 to 22 in August, the lowest since September 2001.EURUSD will face interim resistance at 1.3480, followed by 1.35 and 1.3530. Additional ceilings will emerge at 1.3550, backed by 1.3570. Support starts at 1.3450, backed by 1.34, 1.3380 and 1.3350. Subsequent floors are eyed at 1.33. ( More.. ) Read the rest of this article at Forexnews.comThis article contains the following sections: Sterling Fell after MPC MinutesYen Rallied on Carry Trades Unwinding Full article available at Forexnews.com

ForexNews.com :: it is possible that the Fed will again inject money into the economy as well as engage in a currency

2007-08-12T23:08:00.000-07:00

At 4:30 AM UK July core PPI m/m (exp 0.2%, prev 0.2%)UK July core PPI y/y (exp 2.2%, prev 2.1%)At 8:30 AM US July Retail Sales (exp 0.2%, prev -0.9%)US July Retail Sales x-autos (exp 0.4%, prev -0.4%)At 10:00 AM US June Business Inventories (exp 0.4%, prev 0.5%)The currency market kicks off the week on a quiet tone, with the major pairs confined to a narrow range in early Tokyo trading.

Global central banks stepped in last week to calm fears of an imminent credit crunch, thereby alleviating some of the volatility experienced by the markets. The heightened risk aversion has continued to benefit the yen as trader wariness has prompted heavy unwinding in the carry trades. The inverse relationship between equities and the yen is expected to remain and will likely keep the Japanese currency locked in choppy, volatile trading against the majors as traders closely monitor developments in the money markets.

The coming week will also see several key reports from the US including July retail sales, business inventories, PPI, trade balance, CPI, NY Fed manufacturing survey, TICS, capacity utilization, industrial production, housing starts, Philadelphia Fed survey, and the University of Michigan sentiment survey. Traders will closely scrutinize the US inflation reports for any hints of easing pressure that would enable the Fed to cut rates over the coming months. Further, it is possible that the Fed will again inject money into the economy as well as engage in a currency swap with the ECB to alleviate European banks' demands to meet short-term loan obligations. Markets will likely become less volatile this week in the event that either action will materialize. ( More.. )

Reading The Money Markets

2007-08-12T23:07:00.000-07:00

While lending rates in the UK are set by the Bank Of England, and revised as and when applicable at their regular monthly meetings, there are a few indicators to help forecast any imminent interest rate changes. While to the public eye these interest rate decisions happen overnight, upon further investigation the markets are very much in tune with potential changes.
As well as the economic outlook for the UK, which is more of a longer term indicator for interest rate movements, it is the currency and the money market which will give you the best short term indicator.

Money Markets
The money markets are basically the commercial side of the financial industry, the area where lenders and borrowers are brought together. Via a number of different means, the money markets are very sensitive to what is going on at ground level with regards to the economy, outlook, prospects, etc.

These means include, rumblings form contacts at the Bank of England and actual lending transactions from the Bank Of England - which seem to follow certain patterns prior to interest rate changes.

Seasoned market observers are able to read the signs, and you will very often see “money market rates” moving away form Base Rates, and indicating the future direction of rates.

Currency Markets
Currency markets are basically the basis for UK companies trading abroad, and foreign companies trading in the UK. These rates can have a major impact on local currency denominated profits when UK companies convert back to sterling and overseas companies convert back their own currency.

While the majority of figures which are announced in the UK press refer to the UK economy, overseas inward and outward investment is vital to the success of the domestic UK economy. It is therefore vital the currency rates are supported in order to arrive at the “correct” optimum level. The level which allows UK companies to be competitive overseas, and also encourages foreign investment into the UK.

Just like the money markets, the currency markets are also very sensitive to actual and potential changes in UK base rates, and currency rates are often prone to movement ahead of changes - offering another useful indication.

To the naked eye it may seem that interest rate changes are decided at each monthly meeting, when in fact they have probably been materialising for months, only requiring final confirmation. The transparency of economic data now a days has allowed a number of market observers to develop an understanding of the signs associated with interest rate changes. It is just a case of understanding what and when the markets are communicating.

Forex Beginners 'Must-Do'

2007-08-12T23:06:00.000-07:00

It is believe that more than 50% of Forex traders are losing money long term in the foreign currency exchange market. Yet, there are still a lot of Forex traders jump in to the market, trade blindly and lost their money. Trade after trade, its surprising to see that 'normally-losing' traders keep betting (not investing!) their money into Forex market without reviewing their trading strategy. No matter you are the experienced or the beginners, there are certain 'must-do' when trading Forex to manage the risk wisely and to increase your possibilities in making profits.

'Must-Do 1': Invest in your brain first
If you are serious about investing in Forex market, building up your trading skills and knowledge is the very first step that you must take. Seminars, workshops, video tutorials, online learning, or even books are handful to help us learn from the professional.
Learn to implement technical charting into your trades; learn using indicators to determine the right time to enter/exit the market; brush up your experience by trading with a demo account… all these are effective to ensure your smooth starts and it will definitely reduce your chances of losing money.

'Must-Do 2': Getting the right trading system
It is wise to research very well and consider all the various brokers' system available to you before making your choice. By applying certain level of computer automations (such like charting and doing auto trades), trading; a well-designed trading system will reduce your work dramatically. This in turns give you more time to focus on studying the market and plotting your strategy. Also, using auto-trading system will avoid you from doing emotional-trades. (Review recommended Forex trading tool DashBoard FX here.)

'Must-Do 3': Have a trading plan
As the old says: “Fail to plan is plan to fail”. Trading is like sailing boat middle in the sea; you will not be going anywhere without compass and navigator.
What is the detail objective of the trades? How much profit to expect from the trade? When to get into the market? How much to invest? What price to exit the market? If things do not work out, when do execute the stop loss order? How high is the affordable risk? A good trading plan should at least answers the above questions. Further more, if your trading plan fails, review and modify your trading plan. Find out your mistakes and learn from them.

'Must-Do 4': Money management
Money management is controlling your risk through the use of protective stops, while balancing your potential for profit against your potential for loss. For example, good money management means you know your profit objective and the odds of being right or wrong, and controlling your risk with protective stops. You are better off with a trade where you might lose $1000 if you are wrong and make $500 if you are right, that would work eight times out of ten, than to take a trade where you would make $1000 if you are right and lose only $500 if you are wrong, but works only one time out of three.
If you are investing using your savings, it's even more important that you manage your money in your trading and in your personal expenses. Chances are high that you miss a good investing chance because of you are lack of capital.

'Must-Do 5': Discipline trading
Trading Forex with discipline is important. Success in Forex trading could not be achieved by plotting out the best trading plan. It is also depends on implementing the trading plan. Be discipline, trade according to your plan and never trade with your emotion no matter you are losing money or winning. Greed will stop you from taking profit at predetermined level; while fear will stop you from making the nice kill in the market.

Why should I learn Forex currency trading before I get started?

2007-08-12T22:54:00.000-07:00

Do you know 7 out of 10 traders keep losing money in Forex market; while the rest of the 30% work freely at home and earn millions annually?

Wonder what differs between the losing 70% and the winning 30%? Forex trading skills and the trading system! If you want to work less than 20 hours a day at home, if you want to make millions by trading freely at home, if you want to have financial freedom by trading Forex; you better LEARN Forex trading before you start trading Forex.

Forex market is definitely not a game for newbie and you need to brush up your skills before getting your hands wet.

1. Implement a trading plan.
“If you fail to plan, you plan to fail”. A trading plan is especially crucial in Forex trading to stay ‘in-control’ against the emotional stress in speculative situation. Often, your emotions will blind and lead you to the negative sides: greed causes you to over-ride on a win while fear causes you to cut short in your profits. Hence, a well organized operation has to be predetermined and strictly followed.

2. Trade within your means
If you cannot afford to lose, you cannot afford to win. Losing is a not a must but it is the natural in any trading market. Trading should be always done using excess money in your savings. Before you start to trade in Forex, we suggest you to put aside some of your income to set up your own investment funds and trade only using that funds.

3. Avoid emotion trading
If you do not have a trading plan, make one. If you have a trading plan, follows it strictly! Never ever attempt to hold your weakened position and hope the market will turn back in your favor direction. You might end up losing all your capital if you keep holding. Move on, stay within your trading plan, and admit your mistakes if things do not turn as you want.

4. Ride on a win and cut your losses
Forex trader should always ride till the market turns around whenever a profit is show; while during losing, never hesitate to admit your mistakes and exit the market. It is human nature to stay long on loses and satisfy with small profits – this is why as we mentioned earlier that a strictly followed trading plan is a must-have.

5. Love the trends
Trends are your friends. Although currency values fluctuate but from the big picture it normally goes in a steady direction. If you are not sure on certain moves, the long term trend is always your primary reference. In long run, trading with the trends improves your odds in the Forex market.

6. Stop looking for leading indicators
There aren't any in the Forex market. While some firms make a lot of money selling software that predicts the future, the reality is that if those products really worked, they wouldn't be giving the secret away.

7. Avoid trading in a thin market
Trade on popular currency pairs and avoid thin market. The lack of public participation will cause difficulties in liquidate your positions. If you are beginners, we suggest the big five: USD/EUR, USD/JPY, USD/GBD, USD/CHF, and EUR/JPY.

8. Avoid trading in too many markets
Do not confuse yourself by overtrading in too many markets especially if you are a beginner. Go for the major currency pairs and drill down your studies in it.

9. Implement a proper trading system
There is hundreds of trading systems available on line. Pick one that you are most comfortable with and stick with it. Stay organized in your trades and fully utilized stop-loss or limit functions in your trades.

10. Keep learning
The best investment is always the investment on your brain. Without a doubt, Forex trading needs much more than just a few guidelines or tips to be successful. Experience, knowledge, capital, fortitude, and even some help of luck are all crucial in one’s success in the FX market. if you lose in a trade, do not lose the experience in it. Learn from your mistakes and regain your position in the next trade.