FX Thoughts for the day - 25-Aug-2008 -1140 GMT

USD-CHF @ 1.0984/88... Resistance at 1.1035 held again.
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R: 1.1000-25 / 1.1040-50 / 1.1100
S: 1.0975-50 / 1.0900-880 / 1.0850 / 1.0800
A rise in the pair has once again been restricted to 1.1035, where it faces a strong Resistance. Since then, a dip towards 1.097 has been seen.

Later in the day, expect a further dip towards 1.0955 where the pair has some Support and a rise from there could be seen once again to test the Resistance. A sip below 1.09, unlikely for now, could attract buying interest in the 1.0840 region.


GBP-USD @ 1.8495/99... Could rise towards 1.8564
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R: 1.8500 / 1.8560-80 / 1.8620-60
S: 1.8420 / 1.8365-50 / 1.8300
A small rise since morning has been seen in the pair. For the day, Cable could see a further rise towards the Max High for the day at 1.8564. The Support at 1.8480 is essential for the rise towards 1.8564 to materialize.

Overall the pair continues to remain in a downtrend and is expected to slide further towards 1.83 in the days to come. The UK economy has seen no growth in the last quarter and could continue to face further growth related and housing related issues.

BOE has still not shifted focus from inflation to growth. However, now there could be some rate-cutting action in the days to come, which could eventually take the pair further lower.


AUD-USD @ 0.8674/78... Could rise towards 0.88
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R: 0.8721 / 0.8765 / 0.8800 / 0.8850-65
S: 0.8650-25 / 0.8600 / 0.8581
Aussie had faced major Resistance on a rise to 0.88 last week. However, since then a fall towards 0.8614 has been seen. For the day ahead, a rise towards 0.8721, Max High for the day could be seen. Similarly a further rise towards 0.8750-0.88 cannot be ruled out completely as the Moving Averages are flat and indicating towards the possibility of a rise again.

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Economic Surprise Index for the USD/JPY

You can determine the expected strengthening or weakening of each currency and display the result by currency pair to form a fundamental context of each currency trade. Economic Surprise Index charts use cumulative weekly unexpected surprises from over 500+ daily economic events from eight countries that determine the magnitude and direction of the unexpected surprise component of news announcements.

ESI charts are independent of price, and are a leading indicator of price because they determine the expected strengthening or weakening of a currency pair using a standardized measure of how much and in what direction a country’s economic announcements are moving.

Shown below are the ESI and price charts for the USD/JPY. The ESI context of the trade changed in favor of the USD in March 2008, thus strengthening the USD/JPY. ESI charts display the cumulative unexpected economic surprises of a specific currency pair. You can also determine expected currency pair strengthening or weakening between any two points on the chart as of any given Friday throughout the year. For a more complete explanation of ESI charts and their usage, email info@quartustrading.com, Subject: ESI

Using the available Excel workbook, you can make, display, and print ESI charts for all currency pair from Australia, Canada, the European Union, Japan, New Zealand, Switzerland, the U.K., and the U.S. Select 2, 3, or 4 month cumulative surprises from over 500+ daily economic events formed as the news is released. Choose your own events from each country or use the supplied event lists. Also in the ESI workbook are standardized unexpected event or SUE scales for each of the 500+ announcements that you can print as a visual aid for trading the news. A weekly one hour workbook usage webinar is available free to subscribers.

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Attached Thumbnails

Why ForexGen?

1. Lowest spreads in the market with 0-1 pips in 10 pairs, no commissions, no swaps and instant account Activation.
2. Scandinavian quality with Swiss precision, funds secured and local agents in 18+ countries.
3. ForexGen offers Forex trading in the major currency pairs and crosses.
4. Low capital start, with $250 as a minimum account size.
5. Liquidity and 24/5 availability are the characteristic factors of the Forex market compared with other financial markets.
6. ForexGen offers a free trial Forex demo account that allows you to test your skills and practice without risking real money.

London Session August 25, 2008

After some trend continuation on the USD and Oil on Friday, Asia made a break of support on most USD pairs leaving London wondering where to go. Being a holiday in England was already going to reduce liquidity and without nearby support or resistance, some time was needed to lay some framework for a trade plan.

Watching the Majors closely we were able to find these clues. In this video I focus on just one of these plans involving the GBP/USD. After a series higher lows, cable showed a break of the 15m 21ema. Once this occurred we did a Fibonacci study and simply awaited some level of confirmation on a 1m chart in the 38.2-61.8 range. Sure enough within 30 minutes this entry presented itself in the mid 1.9420's.

As for profit targeting it was quite simple. A retest of previous support now resistance at 1.8500-8510, which also happened to be the hourly 21 was our first real stop. So ultimately we were risking maybe 15 pips for a 75 pippish goal from our fib entry, certainly a quality risk vs. reward setup. Although it seemed to take literally forever to play out, there was never a reason to get out. Slowly we 'Rode the 5ema' and made our way to the 1.8520 area before abruptly returning to 1.9485 or so (another fib). Boring night for sure, but a decent 65-95 pip move even from the fib area here made the waiting well worth it.

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Slow Growth In EURO

Market is looking for Euro-zone and Britain for more evidence of slowing growth.

News and Events:

The Dollar rose on Wednesday, reversing a two-day losing markets, supported by views that slowing global economic growth would prompt a wave of interest rate cuts outside the United States. It gained in quiet trade despite a rebound in Crude Oil prices to $115.51 a barrel.

Data from Europe and Japan are increasingly pointing to deterioration in the growth outlook for those regions, leading
investors to anticipate early rate cuts from both the European
Central Bank and the Bank of England.

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There are worries that US home finance providers Fannie Mae and Freddie Mac may need a government bailout.

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Forex Daily Market Commentary

EURUSD Outlook
Yesterday the EURUSD attempted to push lower, bottomed at 1.4672, but failed to continue this bearish momentum by closed higher at 1.4743. Early today in Asian market, the pair is traded around 1.4780 at the time I wrote this comment. The pair is making a new soft bullish channel and CCI about to cross 100 line up suggesting a possibility of another soft bullish correction on 4h chart. My model goes mixed with neutral bias. Immediate support is seen at 1.4720 followed by 1.4672 (yesterday’s low). Initial resistance at 1.4820 followed by 1.4875. CCI just cross -100 line up on daily chart suggesting a potential bullish correction.

EURUSD Daily Supports and Resistances:

• S1= 1.4674
• S2= 1.4606
• S3= 1.4540
• R1= 1.4808
• R2= 1.4874
• R3= 1.4942

GBPUSD Outlook
Similar to EURUSD, yesterday the GBPUSD attempted to go lower, bottomed at 1.8539 but closed higher at 1.8613. We have a ranging market between 1.8722 and 1.8536 on 4h chart from the beginning of this week and need a breakout. I am expecting an upside breakout as a correctional move at least at 1.8750 resistance level since we don’t have a significant upside correction so far. Immediate support is seen at 1.8580. CCI just cross -100 line up on daily chart suggesting a potential bullish correction. Eyes on UK Retail Sales data today.

GBPUSD Daily Supports and Resistances:

• S1= 1.8540
• S2= 1.8467
• S3= 1.8396
• R1= 1.8684
• R2= 1.8755
• R3= 1.8828

USDJPY Outlook
Yesterday the USDJPY made no significant movement. The pair topped at 110.27 and bottomed at 109.60. My model remains mixed with neutral bias. We have a soft bearish channel on 4h chart and CCI just cross -100 line down suggesting a soft bearish correction potential. Immediate support is seen at 109.30 followed by 108.50. Initial resistance at 110.27 (yesterday’s high).

USDJPY Daily Supports and Resistances:

• S1= 109.54
• S2= 109.23
• S3= 108.87
• R1= 110.21
• R2= 110.57
• R3= 110.88

USDCHF Outlook
Yesterday the Swiss Franc wad traded weaker against Greenback. The pair topped at 1.1039 and closed at 1.0985. We have a ranging market between 1.0872 and 1.1039 since 14/08/2008. My model is mixed with neutral bias. Any breakout from ranging area would give us a clearer direction. CCI just cross 100 line down on daily chart suggesting a potential bearish correction.

USDCHF Daily Supports and Resistances:

• S1= 1.0908
• S2= 1.0831
• S3= 1.0766
• R1= 1.1050
• R2= 1.1115
• R3= 1.1192

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USD Stability in Assian Session

Forex Market Overview 20 August 2008

The Usd was stable in the Asian session, despite the upside surprise in US PPI and slightly better than expected housing data. The EurUsd remained range bound between 1.4806 and 1.4742, and the UsdJpy traded between 109.90 and 109.62. Wall Street was lower yesterday lead by the financial sector and worries over Fannie and Freddie. Commodities bounced back with crude trading to $115.00bll, while gold rebounded back above $815oz. Asian regional stock indexes are surging with Shanghai higher by 7.55% and European indexes are poised to open higher with, the exception of the FTSE, down -2.28%.

The highlight of the European session will be the UK MPC minutes and we will see how close the BoE really is to raising rates. Judging from the price action of the Gbp, the markets are clearly expecting very dovish minutes echoing the dovish Inflation report. We expect the August vote to be identical to July's surprise vote, ie,7-1-1 (Tim Besley voting to raise rates). However, it is a bit astonishing that given the concerns over near term inflation stated in last weeks Inflation Report that in the same report would seem to endorse a rate move lower. There is considerable risk that, in light of the dovish Inflation Report, the market will view another 7-1-1 vote as slightly hawkish.

Daily Forex Pivot Point
AUDUSD
R 3: 0.8846
R 2: 0.8797
R 1: 0.8757
CURRENT: 0.8703
S 1: 0.8626
S 2: 0.8593
S 3: 0.8503

EURJPY
R 3: 163.88
R 2: 163.10
R 1: 162.39
CURRENT: 162.28
S 1: 160.88
S 2: 160.14
S 3: 158.61

USDSGD
R 3: 1.4265
R 2: 1.4219
R 1: 1.4201
CURRENT: 1.4108
S 1: 1.4025
S 2: 1.3891
S 3: 1.3819

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Forex Market Overview

Forex Market Overview 07 August 2008

The Usd was vaguely weaker during the Asian Session, as participants seem to be content with their positions ahead of the critical BoE & ECB rate announcement today. The EurUsd traded higher to 1.5451 from 1.5401, while the UsdJpy traded up to 109.90 (7-month highs), on rumors of option barriers triggered on the break of 108.55. With no surprise, the Jpy fueled carry traded continued to see strong gains as the EurJpy climbed to an August. high at 169.43 and the “King of Carry”, the TryJpy, peaked at 94.45. The commodity bloc found some relief in Asian trading, with the AudUsd climbing from 0.9080 to 0.9120, while NzdUsd reversed earlier gains slipping from 0.7218 to 0.7175. We are seeing some pullback in EM appetite, with the UsdMxn looking to retest the 10.00 resistance and the EurPln continued to rally off 3.200 support to 3.2433. Wti crude is slightly frimer at $118.89bll, as well as gold at $884.15oz. Wall Street closed up and regional Asian stock markets are mixed, with Nikkei leading the losers down -0.93%. European stock futures are pointing to a mixed open.

The BoE & ECB rate announcement will dominate the European session.

In the UK, the BoE is expected to hold rates at 5.00%. Since the MPC is unlikely to issue a accompanying statement, market reaction will be limited. Recentley the market has witnessed a string of gloomy economic data not seen since the last recession. However, the tone of the last meeting minutes suggest that rates are more likely to go up to combat rising inflation than to fall….but that was before this last more economic deterioration and financial turmoil. We are expecting Besley to call for a hike and might find some support, given that the Inflation Report will be released this month. But with this commodity prices easing and a slight dropping in public’s inflation expectations, the BoE might be getting some relief. But right now, showing a “stiff upper lip” in spite of deteriorating fundamentals might be enough to anchor inflation expectations.

On the continent, the ECB is widely expected to hold rates at 4.00%. We doubt, given the clear signs of economic deterioration and headline inflation expected to fall with easing commodity prices, that a move upward would be prudent. Trichet will have to stick with the usual hawkish rhetoric. There is significant risk that this month’s statement will put greater emphasis on the slowing growth story (again helped by declining commodity prices), which the market will perceive as dovish and as the reconsideration of the “no bais” mindset.Throughout our partnership with the industrial leaders, we are capable of delivering incomparable quality of online currency trading service.
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The Forex Markets Today

The Markets Today Tuesday 05August 2008

EUR/USD	1.5505
EXPECTATION		THE RISK	SUPPORT AND RESISTANCE
Euro is headed lower, target 1.5350. Strong support on the way lower at 1.5500 and 1.5460 may slow the move.		Short-term bearish trend at 1.5535. An hourly close above that can see a pullback to 1.5580.	1.5500 STRONG 1.5535 TREND 1.5460 STRONG 1.5585 KEY 1.5350 TARGET 1.5605 STRONG

GBP/USD	1.9565
EXPECTATION		THE RISK	SUPPORT AND RESISTANCE
1.9660 did not hold, Cable is at the lowest levels in 7-weeks and has space to fall to 1.9430.		Short-term bearish resistance at 1.9610 – a breech there may lift the pair to stronger 1.9660, but while the day loses underneath of that we will remain bearish	1.9550 MINOR 1.9615 MINOR 1.9480 STRONG 1.9660 STRONG 1.9430 TARGET 1.9740 KEY

USD/JPY	107.80
EXPECTATION		THE RISK	SUPPORT AND RESISTANCE
The top broke, 108.30 resistance held again and the pair returned to strong support at 107.65. BUY here, next attempt up will lead 100 pips higher to 109.35.		Stop longs upon breaking 107.50, risk is a dip to 106.60	107.65 STRONG 107.90 MINOR 107.15 MINOR 108.30 MINOR 106.60 STRONG 109.30 TARGET

USD/CHF	1.0520
EXPECTATION		THE RISK	SUPPORT AND RESISTANCE
Closed the day at the high, for now holding minor bullish support 1.0500, while above we are looking to extend towards 1.0660		An hourly close underneath of 1.0490 risks 1.0420/40 in the short-term.	1.0500 MINOR 1.0535 MINOR 1.0450 STRONG 1.0590 MINOR 1.0420 KEY 1.0660 TARGET

XAU/USD	885.00
EXPECTATION		THE RISK	SUPPORT AND RESISTANCE
Looking weak this morning, it has nearly reached our 882 target. This may offer some intermediary support and Gold could pull back to 894 for a new SELL		A fall through 880 has room for 865 or even 850 this week.	882 STRONG 888 MINOR 875 MINOR895 STRONG 895 STRONG 865 STRONG 903 STRONG

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.

The Forex Markets Today

The Markets Today Friday 01 August 2008 / 11:40h CET

EUR/USD	1.5565
EXPECTATION		THE RISK	SUPPORT AND RESISTANCE
The move lower could gain speed in euro today. With strong initial resistance 1.5610 likely to top the market and space to fall to 1.5420		Bearish trend at 1.5650 is key – a weekly close above keeps the Euro at high levels.	1.5550 MINOR 1.5610 STRONG 1.5495 STRONG 1.5650 TREND 1.5420 STRONG 1.5700 KEY

GBP/USD	1.9785
EXPECTATION		THE RISK	SUPPORT AND RESISTANCE
Cable touched the 1.9915 level just to fall and close the day bearish. Stay short, trend-line at 1.9885 is key, expect a fall towards 1.94 ish		Intra-day break of 1.9835 risks a spike up – sell such rallies, stop only upon a daily close above 1.99.	1.9750 MINOR 1.9835 STRONG 1.9680 STRONG 1.9885 TREND 1.9600 STRONG 2.0000 STRONG

USD/JPY	107.60
EXPECTATION		THE RISK	SUPPORT AND RESISTANCE
Immediate bullish trend was broken, the correction stopped at 107.20 just to bounce back to 107.60. Strong initial support here, we expect another try of 108.20		A weekly close above 108.20 keeps the pair bid for 110. Failure to do so may see a side-ways range next week 106.50/108.50	107.55 STRONG 107.90 MINOR 107.20 STRONG 108.20 STRONG 106.65 KEY 108.90 MINOR

USD/CHF	1.0480
EXPECTATION		THE RISK	SUPPORT AND RESISTANCE
Remains bullish, initial support at 1.0460, waiting to break higher – target 1.0660		1.0445 intra-day key support broken risks a set-back to 1.0350	1.0460 MINOR 1.0500 MINOR 1.0445 STRONG 1.0540 MINOR 1.0350 TREND 1.0660 TARGET

XAU/USD	909.00
EXPECTATION		THE RISK	SUPPORT AND RESISTANCE
Volatile day yesterday, try both sides. The day ended underneath of 916 and we remain bears for a weekly close near 885		925 is key resistance today – a weekly close above that may hold Gold for a week.	900 MINOR 914 STRONG 895 STRONG 925 KEY 885 TARGET 931 STRONG

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.

The Forex Market Today

The Markets Today Tuesday 29 July 2008 / 10:00h CET

EUR/USD	1.5750
EXPECTATION		THE RISK	SUPPORT AND RESISTANCE
Both, the top and the bottom held and the Euro was held in tight range. Minor bullish trend at 1.5730 this morning, while this holds we can re-challenge 1.5760/85 level		We remain bearish in the medium-term, an hourly close underneath of 1.5725 is a bearish signal. On top: a close above 1.5820 stops our view.	1.5730 MINOR 1.5765 STRONG 1.5690 STRONG 1.5820 KEY 1.5640 MINOR 1.5860 STRONG

GBP/USD	1.9935
EXPECTATION		THE RISK	SUPPORT AND RESISTANCE
The bullish trend held and Cable went to test the top. 2.00 is still key resistance, we like to try shorts here for a new dip to at least 1.9885.		An daily close above 2.00 keeps Cable bid. But a daily close underneath of rising support 1.9885 calls for a move lower	1.9925 MINOR 1.9970 MINOR 1.9885 TREND 2.0005 KEY 1.9810 STRONG 2.0060 MINOR

USD/JPY	107.60
EXPECTATION		THE RISK	SUPPORT AND RESISTANCE
More range trading ahead, we lower the range a few pips to 106.80 / 107.70.		An hourly close above 107.75 should lead to 108.50	107.30 MINOR 107.70 MINOR 106.80 STRONG 108.10 MINOR 105.85 STRONG 108.50 STRONG

USD/CHF	1.0330
EXPECTATION		THE RISK	SUPPORT AND RESISTANCE
Not much of a dip so far. Here we expect the USD to test rising support 1.0285, wait to buy such a dip.		An hourly close underneath of 1.0270 stops our otherwise bullish view for a rise above 1.04.	1.0305 MINOR 1.0355 MINOR 1.0285 TREND 1.0400 KEY 1.0210 MINOR 1.0485 STRONG

XAU/USD	930.00
EXPECTATION		THE RISK	SUPPORT AND RESISTANCE
Small initial range 926 / 935 – possible extension towards 940, we like to sell tops for a medium-term move through 900		Minor bullish support 925 broken today will unleash a bearish move faster than expected with initial target 917	926 STRONG 936 MINOR 917 KEY 939 STRONG 908 MINOR 945 MINOR

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.