Weakness In USD

Forex Market Overview 18 August 2008

The Usd was slightly weaker in the Asian session and start of the trading week. This week will have market participants pondering the swift unraveling of the global growth decoupling story and sharp correction in commodity prices. The massive surge in the Usd caught many analysts off guard, causing a broad recalculation of forecasts. However, most are now predicting a short term tempering of Usd buying. We should like to see how this week's trading plays out, before expressing our short term bias. The EurUsd traded upward from 1.4649 to 1.4767, while UsdJpy fell slightly from 110.61 to 109.97 on light trading. The commodity bloc was able to gain some ground, with the NzdUsd moving sharply from 0.7040 to 0.7100 and AudUsd from 0.8654 to 0.8745. Crude is slightly higher trading at $115.11bll up 1.17% while gold is above the $800oz mark. The Asian regional indexes are following Wall Street mixed closed on Friday, with Shanghai down -4.61%. European futures are now pointing to a mixed opening.

With a relatively empty calendar today, the European session markets will be watching the EuroZone trade balance for signs of global weakness.

Daily Forex Pivot Point

AUDUSD
R 3: 0.8952
R 2: 0.8845
R 1: 0.8797
CURRENT: 0.8750
S 1: 0.8652
S 2: 0.8593
S 3: 0.8504

EURJPY
R 3: 164.40
R 2: 163.88
R 1: 163.10
CURRENT: 162.52
S 1: 161.845
S 2: 161.39
S 3: 160.15

USDSGD
R 3: 1.4265
R 2: 1.4220
R 1: 1.4193
CURRENT: 1.4123
S 1: 1.4025
S 2: 1.3890
S 3: 1.3820

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Forex Market Overview

Forex Market Overview 01 August 2008

The Usd was able to hold on to late day gains in the Asian session, as weak initial jobless claims threaten to end the greenback strength. However, a late US session sell off in oil and less than hawkish comments from ECB members, quickly came to the Usd aid. The EurUsd traded lower from 1.5605 to 1.5550, while the UsdJpy bounced between 108.40 and 107.55. The AudUsd fell sharply lower, as a local media reported that the RBA was ready to start easing, trading down to 0.9360.. In the late Asia trading FX markets have gotten very quiet, as market seem willing to wait until this afternoon’s release of US Non Farm Payrolls. Crude is slightly weaker at $123.34bll, while gold is trading down to $910.50oz. As the trend of falling economic activity continues in the G10, we expect commodity prices to continue to soften, which, in turn, should support the Usd.

Paulson said yesterday in Washington that… "While the stimulus is making our economy stronger than it would have been otherwise, the housing correction, credit market turmoil and high energy prices remain a considerable drag on the economy -- and the effects of this drag can be seen in the soft job market". Paulson also expressed that he sees improvement in the US economy saying..."We are making progress, although not in a straight line. Housing continues to be at the heart of our economic challenges and remains our most significant downside risk…We must work though the necessary adjustments in housing and credit markets to return to growth next year and beyond."

A lack of data in European session will have the market squarely focused on the US session and the release of non-farm payrolls. The much better than expected ADP figures, which printed at 9k, has once again provided intrigue to today already volatile release. We still believe, after yesterday’s jump in initial jobless claims and further deterioration in the Conference Board survey (job component), that the risk are skewed to the downside. In addition, ADP has been overly optimistic in recent months. While we are expecting something slightly higher than the 75k consensus, our gut is saying that anything is possible today, especially how events and sentiment are falling in place for Usd bulls.

Daily Forex Pivot Point

AUDUSD
R 3: 0.9528
R 2: 0.9476
R 1: 0.9419
CURRENT: 0.9369
S 1: 0.9357
S 2: 0.9328
S 3: 0.9276

EURJPY
R 3: 169.73
R 2: 169.19
R 1: 168.31
CURRENT: 167.23
S 1: 167.10
S 2: 166.01
S 3: 165.33

USDSGD
R 3: 1.3850
R 2: 1.3827
R 1: 1.3717
CURRENT: 1.3694
S 1: 1.3606
S 2: 1.3567
S 3: 1.3501

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Forex Market Overview

Forex Market Overview 30 July 2008

The Usd was higher in Asian session, as a combination of stronger bank stocks and lower crude prices gave the greenback a broad based boost. The EurUsd slid to 1.5554 from 1.5599, while UsdJpy was able reversed its downward trend in early Asia , rebounding to 108.20 from 107.88. The NzdUsd broke below critical 0.7368 support, trading to session lows of 0.7333, as bad news from the Kiwi financial sector and lower commodity prices weighed on the Nzd. Jpy fueled carry trades were range bound, despite lower volatility, with the EurJpy trading between 213.80 and 214.25. Wall Street rallied strongly, with the Dow up 2.39% and Asian regional indexes are following, with the Hang Seng currently up 2.05%. Lower commodities price across the board help equities, with wti crude trading at $121.81bbl and gold at $916.11oz.

Oil was sold heavily, as worries over slowing demand ahead of today's inventory data and remarks by OPEC president Khelil, cautioning that crude prices could fall to $70bbl-$80bbl (long term) as the greenback goes through a period of strength. There is evidence in trading momentum and a growing sense of optimism that the markets are actively looking for the US economy to stabilize and for the Usd to begin its move towards a period of strength.

In Japan, the Industrial production for June dropped m/m - 2.0% vs.
-1.7% exp. The Japanese government has trimmed its forecast for industrial output, conceded the sector is slowing, as surveys show further signs of weakness up ahead.

In New Zealand, RBNZ Governor Bollard spoke on the subject of inflation targeting. Outside the core subject, the key take away was when he mentioned that he sees 'plenty of room' for rates to drop further. While the RBNZ has already signaled their intention to ease further, Bollard's remarks today are the most unambiguous reference yet that the market will see significantly lower rates. We see a significant period of Nzd weakness and perhaps the main rational for any support seems to be coming from Japanese margin traders, who are extensively long Nzd.

In the European Session, the market will be focused on July's EC Economic Sentiment Indicator. We are expecting this figure to continue the string of negative data from the Eurozone, especially given the sharp fall in industrial confidence and slump in PMI survey.

Daily Forex Pivot Points
AUDUSD
R 3: 0.9637
R 2: 0.9590
R 1: 0.9528
CURRENT: 0.9484
S 1: 0.9451
S 2: 0.9404
S 3: 0.9328

EURJPY
R 3: 171.80
R 2: 171.05
R 1: 169.97
CURRENT: 168.41
S 1: 167.50
S 2: 166.00
S 3: 165.33

USDSGD
R 3: 1.3850
R 2: 1.3827
R 1: 1.3715
CURRENT: 1.3688
S 1: 1.3567
S 2: 1.3500
S 3: 1.3448

Throughout our partnership with the industrial leaders, we are capable of delivering incomparable quality of online currency trading service.
ForexGen services are all controlled by the international banking and financial regulatory standards.
ForexGen is continuously providing the Forex market's safest trading terms & conditions. Providing professional currency trading services that meet our client's expectations is our first priority.

ForexGen principals:

ForexGen customer satisfaction is our major objective. To reach our business goals, we strive to put our client's goals in focus. We highly value our clients and always aim to exceed their expectations and cross the limitations encountered by the sophistication of the Forex trading industry.

Forex Market Overview

Forex Market Overview 28 July 2008

The Usd was stronger at the start of the trading week in the Asian session. The EurUsd traded around the 1.5700 levels, while the UsdJpy failed to hold above the 108.00 level, slipping down to 107.84 as the day progressed. The NZD was supported by heavy margin buying, according to the Tokyo Financial Exchange publicly released data last week. The UsdNzd was able to rally of the 0.7409 session low to 0.7439. The UsdMxn saw a massive gap on the open, spiking from 10.0200 to 10.1229, as the BANXICO announced the end of its daily selling net fx reserves from accumulated oil revenues. The Jpy fueled carry trades continued to perform well, as risk declined and Japanese economic fundamentals erode. The EurJpy continued to rally from Friday's sell off, which saw 167.50 lows to Asian session 169.70 highs. The Asian stock markets are following the US higher, with Shanghai up 1.78%. Commodities are slightly firmer with wti crude trading up 0.28% to $123.61brl.

Despite the sudden resurgence in the Nzd strength, due partially to the excessive buying of Japanese margin traders and low liquidity, we expect to Nzd to weaken considerable in the coming week. Trade balance narrowed with imports falling on slowing demand but exports grew unexpectedly. With a "normal" monetary policy rate round 6.00% - 6.25% levels and the RBNZ clearly signaling a shift to a growth focus, the interest rate differential long enjoyed by the kiwi will unravel.

No major events or economic data scheduled for release in the UK or Eurozone.

Daily Forex Pivot Points
AUDUSD
R 3: 0.9795
R 2: 0.9675
R 1: 0.9637
CURRENT: 0.9555
S 1: 0.9525
S 2: 0.9477
S 3: 0.9450

EURJPY
R 3: 171.80
R 2: 171.07
R 1: 169.97
CURRENT: 169.13
S 1: 167.50
S 2: 166.00
S 3: 165.33

USDSGD
R 3: 1.3826
R 2: 1.3717
R 1: 1.3660
CURRENT: 1.3638
S 1: 1.3563
S 2: 1.3500
S 3: 1.3448

Throughout our partnership with the industrial leaders, we are capable of delivering incomparable quality of online currency trading service.
ForexGen services are all controlled by the international banking and financial regulatory standards.
ForexGen is continuously providing the Forex market's safest trading terms & conditions. Providing professional currency trading services that meet our client's expectations is our first priority.

ForexGen principals:

ForexGen customer satisfaction is our major objective. To reach our business goals, we strive to put our client's goals in focus. We highly value our clients and always aim to exceed their expectations and cross the limitations encountered by the sophistication of the Forex trading industry.

Forex Market Overview

Forex Market Overview 21 July 2008

Usd was stable in Asian session as the lack of new data and non-data events gave speculators nothing new to trade on. EurUsd stayed well within Fridays range, trading from 1.5830 – 1.5874 while UsdJpy trended slightly lower from 106.98 to 106.71. AudUsd broke out of Fridays doldrums, trading back up to 0.9767. Asian Equity markets are in the green while European index futures are pointing to a negative open. Commodities are higher with wti crude trading at $129.88bbl and gold up .66% to 961.37. Bonds continue to decline across the treasury curve, as risk appetite is slowly returning to the market. FX 1-month implied vols are coming off last weeks highs, helping to support renewed risk appetite.

In the UK Rightmove House Price indices showed another decline in prices m/m 1.8% ( y/y 2.0%). In addition, the report also warned that unsold homes (per agency) have hit a record high. While the market was silent to the news, with deteriorating domestic conditions and the housing correction still well entrenched, the BoE will be increasingly pushed into a difficult dilemma (especially considering the UK will skid dangerously close to a recession).

In Australia , PPI came in lower for q2 rising to 1.0% q/q well below the expected 1.6% q/q, however the data does show an acceleration of inflation pressures. While PPI is not directly correlated with CPI it illustrates that inflation is still a concern and gave the Aud a slight boost in early trading.

No major events or data scheduled for release in the UK or Eurozone.

Daily Forex Pivot Points
AUDUSD
R 3: 0.9895
R 2: 0.9849
R 1: 0.9818
CURRENT: 0.9755
S 1: 0.9675
S 2: 0.9664
S 3: 0.9597

EURJPY
R 3: 170.00
R 2: 169.67
R 1: 169.18
CURRENT: 169.17
S 1: 168.25
S 2: 166.01
S 3: 165.33


USDSGD
R 3: 1.3717
R 2: 1.3661
R 1: 1.3565
CURRENT: 1.3511
S 1: 1.3452
S 2: 1.3399
S 3: 1.3300

The ForexGen's provided services are all restricted and regulated by the international banking and financial regulatory standards. All our provided activities are supported by creativeness and modernization. Ambitious & motivated employees are working simultaneously to protect the customer's confidentiality. ForexGen is continuously providing the market's most competitive conditions.

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Forex Market Overview

Forex Market Overview 18 July 2008

Usd consolidated in Asian session, as the current environment paints a mixed picture creating indecision in traders. EurUsd in choppy trading ranged from 1.5783 to 1.5866 while UsdJpy was slightly stronger, rising above 107.00 in early trading, before retracting back to 106.13 as the day wore on. Jpy fueled carry trades followed a similar pattern. Commodity bloc ccy’s continued to hold up despite general pullback in commodity prices. AudUsd was able to rally off the 0.9680 session, lows to 0.9725. Try was able to gain on the back of their Central Bank raising rates 50bp with UsdTry falling to 1.1950. Usd sentiment is clearly varied and will stay so for today’s trading.

Equity markets in the US clearly got a boost from yesterday’s sharp fall in oil prices--down almost $5bbl to $129.50bbl (partially due to reports the US will attend nuclear talks with Iran, easing perceptions of geopolitical tensions). This optimism was also reflected in yields with 2-year up 2.50%. This weeks decline brings up an interesting situation if energy prices continue to decrease, many central banks will take this as positive sight that inflation pressures will also ease. Which will therefore, provide policy makers with the perceived opportunity to address deteriorating growth by lowering rates.

Australian terms of trade for Q2 were better than expected. Export prices for Q2 surged by 13.5% vs. 10% exp q/q, while import prices grew by only 1.4% vs, 1.7% exp q/q. The rise in export prices reflects a broad based surge of commodity demand. As stated above Aud and the rest of the commodity bloc remains supportive of commodity prices and yield differentials.

BoJ minutes revealed a slightly more hawkish view on inflation than expected, however it is clear that members will be focused on the downside risks near term. In addition Shirakawa noted that Japans economy is more insolated from external shocks than previously believed. We are targeting 108.00 despite the unsettled nature of risk appetite.

Another light day in European session and with summer Friday clearly in effect, we expect trading to be subdued.

Daily Forex Pivot Points
AUDUSD
R 3: 0.9895
R 2: 0.9849
R 1: 0.9818
CURRENT: 0.9718
S 1: 0.9675
S 2: 0.9664
S 3: 0.9597

EURJPY
R 3: 170.00
R 2: 169.67
R 1: 169.11
CURRENT: 168.39
S 1: 165.23
S 2: 164.76
S 3: 163.60

USDSGD
R 3: 1.3717
R 2: 1.3661
R 1: 1.3565
CURRENT: 1.3521
S 1: 1.3452
S 2: 1.3399
S 3: 1.3300

The ForexGen's provided services are all restricted and regulated by the international banking and financial regulatory standards. All our provided activities are supported by creativeness and modernization. Ambitious & motivated employees are working simultaneously to protect the customer's confidentiality. ForexGen is continuously providing the market's most competitive conditions.

ForexGen complies with the trade commissions in the USA, EU and Australia. Being registered by the commercial authorities in 18+ countries, we adhere to the United Nations Commission on International Trade Law (UNCITRAL).

Profile regulatory information:

ForexGen is complying with all applicable international laws and all financial regulations and procedures governing its industry in order to sustain the security standards in the financial services world.