Forex Market Overview

Forex Market Overview 08 July 2008

The Usd weakened in Asian session as risk aversion crept back into the market. EurUsd jumped to 1.5753 before retracing to 1.5700 support while UsdJpy fell from the 107.33 highs to 106.83. Risk appetite declined as a research report arguing that Freddie and Fannie would need additional capital, circulated in the market sending US and Asian stocks down and 2 year yields fell by 8bps. Carry trades also felt the effect of the sentiment shift with EurJpy falling sharply to 167.83 from 168.61 and AudJpy trading down to 101.90. Whether its pressure from the G8 summit which began yesterday (leaders have continuously stressed the need for action on food & energy cost) or reaction to deteriorating global growth but either way crude closed down to $141.64bbl. Gold closed lower; the most active Aug '08 contract down $4.80 to $928.80. Sep '08 silver -45.0 ¢ at $17.920/oz.

Asian markets trading down this morning amid concerns that the credit market losses will widen and inflation will further slowdown the global economic growth. Japan's Inpex Holdings declined driven by weakness in the energy sector. Kookmin Bank, South Korea's largest, tumbled the most in almost four months following a broker downgrade. G8 has stated that the global economy faces uncertainty and downside risks mainly posed by the sharp rise in oil prices. It also made a small indication that they wanted to see the Chinese Yuan appreciate to help reduce global financial imbalances. No statement on FX so far.

Yesterday dreadful manufacturing and industrial output which both fell well below expectations should continue to weigh on the Gbp. And in Asian session BCC Quarterly Economic Survey highlighted slowing economic activity and rising price pressures. We are now seeing significant deterioration in multiple UK sectors (and at a faster pace then anticipated) which will eventually create a significant dilemma for the BoE. According to the British Chamber of Commerce the economy looks very likely to fall into recession as sales of services and manufactured goods fell sharply in the second quarter. The BCC Index fell to its lowest number since 1992 as a serious slowdown in the property market and rising inflation has seen a dramatic decline in confidence.While Nationwide and DCLG housing prices should show additional weakness we are expecting the MPC to hold at 5.00% this week.

12.00gmt - Fed’s Bernanke Speaks (but no Q&A)

Daily Forex Pivot Point
AUDUSD
R 3: 0.9827
R 2: 0.9670
R 1: 0.9640
CURRENT: 0.9526
S 1: 0.9512
S 2: 0.9560
S 3: 0.9590

EURJPY
R 3: 169.46
R 2: 169.15
R 1: 168.63
CURRENT 167.53
S 1: 167.13
S 2: 166.10
S 3: 166.00

USDSGD
R 3: 1.3850
R 2: 1.3827
R 1: 1.3730
CURRENT: 1.3634
S 1: 1.3565
S 2: 1.3506
S 3: 1.3470

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.

Forex Market Overview

Forex Market Overview 07 July 2008

Usd is stronger against every major currency in the Asian session as speculation grows that the G8 meeting will focus on record high oil prices. EurUsd continued to decline from Thursdays sell-off, sliding to 1.5623 (on rumors that German bonds were to be redeemed rather then re-invested) while UsdJpy traded to 107.52 (7 day high). GbpUsd dropped from 1.9820 to 1.9722 as the market began to once again question the stability of the UK underlying economy. Carry trades gained on renewed Jpy selling and declining risk aversion, pushing EurJpy to 168.07 and AudJpy 103.12. The tight correlation between oil & Usd has lessened slightly in recent day with wti stable around the 143.50bll level while the Usd has taken a bullish tone. After the long weekend in the States, investors have been able to take stock and decide how to react to the Trichet statement that followed the ECB raising rates and the U.S. payroll numbers last Thursday.

Trading was still subdued despite the Usd strength with investors looking for more clues on the U.S. economic situation and to see if the Federal Reserve will be in a position to raise interest rates any time soon. Many will look towards comments from Fed officials over the coming days and in particular to Chairman Bernanke who may give some support to the Dollar during the week ahead.

Asian markets mostly trading higher this morning. Bargain hunters have taken the Nikkei from a 0.5% morning loss to a 1.0% afternoon gain as the market hopes to break its streak of 12 consecutive declines. Banks and exporters were popular choices. But, volumes were thin since the US was closed 4-Jul and could therefore not provide any direction. Chinese banks and airlines led Hong Kong and Shanghai up, but banks led a fall in Sydney over concerns about global credit markets. Also, miners and metals fell in Sydney.

BoJ Governor Shirakawa spoke saying said that global inflationary risks were growing and Japan's economy was slowing due to high energy and commodity prices. A very familiar script and preparing the market for the BoJs growth forecast downgrade expected this week.

A light calendar today will have the markets focused on the UKs Industrial production. The abrupt decline in the output balance of the June CIPS/RBS report on manufacturing suggests that output will soon be collapsing. We have already seen the Gbp come under significant selling pressure and expected the GbpUsd to continued to trade down (in choppy trading) to the 1.9300 mid term.

Daily Forex Pivot Point
AUDUSD
R 3: 0.9829
R 2: 0.9700
R 1: 0.9670
CURRENT: 0.9576
S 1: 0.9580
S 2: 0.9535
S 3: 0.9514

EURJPY
R 3: 170.00
R 2: 169.45
R 1: 169.15
CURRENT: 167.99
S 1: 167.13
S 2: 166.10
S 3: 166.00

USDSGD
R 3: 1.3850
R 2: 1.3827
R 1: 1.3730
CURRENT: 1.3647
S 1: 1.3565
S 2: 1.3505
S 3: 1.3470

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.

Forex Market Overview

Forex Market Overview 04 July 2008

FX markets were relatively stable in Asian session as yesterday’s volatility seem to have driven more then just the US participant to start their weekend early. EurUsd climbed tentatively back above the psychological 1.5700 level while UsdJpy bounced around 106.60 / 106.80 levels. Carry trades picked up a slight intraday upwards trend with EurJpy moving from 167.25 to 167.84 and AudJpy found support on the 10d-ma, rallying to 102.75. With a light calendar and the US 4th of July holiday we would expect trading to be subdued.

Oil prices were stable with Dubai trading at 145.13bll while gold slipped slightly to 934.35oz. US stock markets for the most part were able to shrug off the negative payroll data and close slightly higher however Asian markets were lower with only the Shanghai Composite trading up 1.95% higher today. European index futures are trading higher before the open US markets are closed.

As we had expected the ECB raised rates by 25bp to 4.25% yesterday while the accompanying press conference was more dovish then we had anticipated. In fact during the Q&A portion, Trichet said, “I have no bias” in regards to future rate decisions. A comment he has never uttered before and clearly illustrates that the ECB now has a neutral bias. At this point we have a slight bias towards an additional hike in September due primary to Euro zone inflation which is expect to print at 4.1% for August. A large worrying figure and one that will provide Trichet with many sleepless nights, especially considering growth has now increased the pace of downwards deterioration. We don’t expect EurUsd to pick up any noticeable trend until data from both countries starts giving us real signals as to the direction of monetary policy.

We will however be watching the UK and Gbp for selling opportunities. While the recent trading pattern of Gbp strength has been based on the markets renewed focus on inflation over growth we expect given the rapid decline of the domestic economy an eventual shift will occur. We expect a choppy move back to the 1.9300 lvls mid term.

Yesterday Sweden’s Riksbank hiked rates 25bp to 4.50%, following the lead of the Norges Bank in a move that was widely expected. CPI inflation has recently jumped to 4.0% and rate expectations have followed suit putting the offensive. In addition, the bank signaled that the market could see two more rate hikes in order to slow the economy and contain inflation pressures.

In Australia trade deficit printed at $965m in May in line with expectations. However, there were large revisions of around $1.0bn to April, as higher contract prices for commodities were passed through.


10:00gmt - ECB's Trichet speaks
10:00gmt - ECB's Gonzales-Paramo speaks

Daily Forex Pivot Point
AUDUSD
R 3: 0.9827
R 2: 0.9700
R 1: 0.9670
CURRENT: 0.9625
S 1: 0.9580
S 2: 0.9536
S 3: 0.9515

EURJPY
R 3: 170.00
R 2: 169.45
R 1: 169.15
CURRENT: 167.87
S 1: 167.25
S 2: 166.10
S 3: 166.00

USDSGD
R 3: 1.3850
R 2: 1.3827
R 1: 1.3730
CURRENT: 1.3611
S 1: 1.3565
S 2: 1.3505
S 3: 1.3470

ForexGen provides its institutional clients with incomparable professional and individualized trading services. As a professional online trading service, ForexGen provides several facilities for all kinds of traders. Our corporate and managed trading service performance are based on respect and appreciation which is only achieved by offering intelligent high end trading tools for secure investment. ForexGen is the easiest and fastest gateway for the corporate traders to perform successful trading, which provides a unique institutional investor professional facilities and highly qualified individualized services for the international customer. ForexGen provides advanced online trading software with full corporate trading services. A rich choice of managed accounts are also available, please check our Managed Account Section

ForexGen delivers what traders want: instant order execution, lowest spreads, flexible starting capital, fast deposits and withdrawal, a local support in more than 18 countries, and most of all, solid funds security.

Winning in trading depends on using the right strategy and controlling all the moves. Trading strategies are discussed in details at ForexGen Academy.

Forex Market Overview

Forex Market Overview 02 July 2008

Usd was stable in the Asian session as better then expected US data kept the greenback bears in check. EurUsd found support from the 5-ma trading from 1.5777 to 1.5820 while GbpUsd was unable to hold above the psychological 2.000 mark, trading between 1.9930 – 1.995. UsdJpy saw a decent rally off 105.25 to 106.18 before slipping slightly to 105.80 as the trading day wore on. Aud crosses were gainers after better then expected retail sales caused AudUsd to jump from 0.9521 to 0.9609 and AudJpy climb to 101.79.

Yesterday's rise in the ISM survey of manufacturing was a positive sign, however the detail's are less than hopeful. The composite index rose to 50.2 vs.. 48.5 exp (which suggest an annual GDP around 2.0%). The concern is that the largest contribution to this number was investors who increased accumulation due to soft demand. It’s interesting to note that the industrial sector has not yet been pulled down by the deteriorating housing sector and weak consumer confidence.

In Australia, retail sales rose 0.7% vs. 0.1%, the strongest biggest monthly rise since July 2007. At this point we expect this figure to be a one off as stock liquidation sales and significant discounting occurred as retailer attempted to improve the slow start to the year. In addition, building approvals fell by -6.5% vs. -3.0%. While positive data will undoubtedly give the Aud temporary support, as the markets speculate on the RBAs monetary policy, we expect the domestic market to continue to deteriorate.

In Turkey, police arrested a number of prominent secularists who were charged with planning a coup. We expect this is only the beginning of an escalation in a political power struggle as the Supreme Court hears arguments on whether to ban the AKP. Usdtry traded up to 1.2512 on the news.

In the European Session Euro zone Producer price inflation is expected to rise as surging energy prices have put pressure on inputs. A strong figure should give the EurUsd a supportive tone today. Note that Usd index is already testing the bull channel base and a break could lead to further weakness.

10.10gmt - ECB’s Tumpell-Gugerell Speaks
16.00gmt - US Trsy Sec pauls speaks
17.00gmt - Fed's Mishkin speaks

Daily Forex Pivot Point
AUDUSD
R 3: 0.9827
R 2: 0.9700
R 1: 0.9670
CURRENT: 0.9610
S 1: 0.9511
S 2: 0.9490
S 3: 0.9449

EURJPY
R 3: 170.00
R 2: 169.46
R 1. 168.60
CURRENT: 167.81
S 1: 166.09
S 2: 166.00
S 3: 165.52

USDSGD
R 3: 1.3850
R 2: 1.3827
R 1: 1.3729
CURRENT: 1.3618
S 1: 1.3560
S 2: 1.3506
S 3: 1.3470

ForexGen provides its institutional clients with incomparable professional and individualized trading services. As a professional online trading service, ForexGen provides several facilities for all kinds of traders. Our corporate and managed trading service performance are based on respect and appreciation which is only achieved by offering intelligent high end trading tools for secure investment. ForexGen is the easiest and fastest gateway for the corporate traders to perform successful trading, which provides a unique institutional investor professional facilities and highly qualified individualized services for the international customer. ForexGen provides advanced online trading software with full corporate trading services. A rich choice of managed accounts are also available, please check our Managed Account Section

ForexGen delivers what traders want: instant order execution, lowest spreads, flexible starting capital, fast deposits and withdrawal, a local support in more than 18 countries, and most of all, solid funds security.

Winning in trading depends on using the right strategy and controlling all the moves. Trading strategies are discussed in details at ForexGen Academy.