Forex Online Trading

FOREX-Dollar off 5-month low, U.S. debt auctions awaited

2009-05-26T07:54:00.001+01:00

TOKYO, May 26 (Reuters) - The dollar rose from a five-month low against a basket of currencies on Tuesday as investors booked profits on a spike in the euro and other higher-yielding currencies, while traders awaited U.S. Treasury auctions to test the strength of investor appetite for dollar assets.

The euro slid against the dollar and the yen after Britain's Daily Telegraph reported that Germany's financial regulator BaFin had warned that toxic debt of the country's banks would blow up "like a grenade" unless they took advantage of government's bad bank plans to prepare for next phase of crisis.

The report was not new, however, as the regulator warned last week that German banks have bad assets of around 200 billion euros ($280 billion).

Traders said speculators used the report as an excuse to sell the European single currency after its jump of about 8 percent in just a month against the dollar, from $1.30 to $1.40.

"The euro, the Australian dollar and sterling all have risen to levels where people would feel they have run their course for now," said Osamu Takashima, chief currency analyst at Bank of Tokyo-Mitsubishi UFJ. "It's understandable to see profit-taking on them."

Activity picked up in Asia as U.S. and British financial markets will resume trading later in the day after a three-day weekend.

The dollar index .DXY, a gauge of the greenback's performance against six other major currencies, edged up 0.2 percent to 80.146.

The index struck a five-month trough of 79.805 last week when concern that U.S. government debt may lose its AAA rating prompted investors to sell the world's reserve currency.

The euro fell to $1.3986 , down from $1.4023 in late Asian trade on Monday. It rose as high as $1.4051 on trading platform EBS on Friday, its highest since early January.

The euro was also under pressure a day after the German-based Ifo think tank's business climate index on Monday fell short of market expectations, suggesting that any recovery in the euro zone's biggest economy will take more time.

The European single currency fell to 132.49 yen down almost 1 yen from late Asian trade on Monday, as funds took profits on the euro's sharp gains against the yen in the past week.

Dollar extends slide but Asian stocks gain

2009-05-22T07:39:00.000+01:00

HONG KONG (Reuters) - The dollar fell on Friday to its weakest in almost five months against major currencies on investor worries that the United States would lose its AAA rating, though Asian stocks headed for a solid weekly gain.

The dollar's descent was sparked on Thursday when Standard & Poor's cut its outlook on Britain's top rating to negative, bringing into focus other AAA-rated countries that are running into higher debt in an attempt to boost their economies with big spending plans.

Although signs of hope in the global economy are helping to support Asian stocks, worries are also growing about the strength of any recovery and whether the shift into riskier asset such as oil is justified.

A weaker dollar is also strengthening Asian currencies, which is bound to hurt the export-dependent continent and further raise doubts among investors about whether a gain of more than 50 percent in Asian shares excluding Japan since early March is excessive.

"Markets all around the world appear to be looking for direction, and any chance of a U.S. downgrade would really hit U.S. assets such as the dollar and stocks," said Masayoshi Okamoto, head of dealing at Jujiya Securities.

"For Japan, this situation comes just after earnings have come out and companies have set their currency rates, many of them at 95 yen. The chance of any further yen rise really paints a gloomy picture."

The dollar index .DXY, a gauge of its performance against six major currencies, fell as low as 80.257, its weakest since late December and was last down 0.2 percent at 80.302.

The slide in the U.S. currency comes as investors are finding it harder to ignore the effect of the Federal Reserve's zero interest rate policy and its efforts to keep long-term rates low through direct purchases of U.S. government debt.

The dollar slipped 0.3 percent from late U.S. trade to 94.08 yen after falling as low as 93.86 yen on trading platform EBS, its lowest since mid-March.

The euro rose 0.4 percent to $1.3945, its strongest since early January. Sterling, despite the S&P action, rose as high as $1.5893, its highest since early November according to Reuters data, and was last up 0.2 percent at $1.5885.

"S&P gave a clear criteria that a country whose government debt burden is approaching 100 percent of GDP could have its rating downgraded," said Hideki Amikura, deputy general manager of forex trading at Nomura Trust and Banking.

"That prompted investors to think they should not be so optimistic about credit rating on the United States."

But U.S. Treasuries recovered after concerns about debt levels sent prices tumbling on Thursday. The Treasury's announcement that it would sell $101 billion in notes next week also sparked supply concerns.

Benchmark 10-year U.S. Treasury notes rose about one point, sending yields down to 3.34 percent from the 3.37 percent level hit on Thursday that had marked the highest yield on an intraday basis in nearly two weeks.

Market Commentary

2009-05-22T07:24:00.001+01:00

MARKET COMMENTARY ON 22ND MAY 2009

GBP/USD closed higher due to short covering on Thursday as it extends yesterday's high range. The high-range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are turning bullish signalling that sideways to higher prices are possible near-term. Closes below the 20-day moving average crossing would temper the near-term friendly outlook in the market. If it renews this month's rally, March's high crossing is the next upside target.

EUR/USD closed higher due to short covering on Thursday as it extends yesterday's high range. The high-range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are turning bullish signalling that sideways to higher prices are possible near-term. Closes below the 20-day moving average crossing would temper the near-term friendly outlook in the market. If it renews this month's rally, March's high crossing is the next upside target.

USD/CHF closed higher due to short covering on Thursday as the dollar weakened. The high-range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are turning bullish signalling that sideways to higher prices are possible near-term. Closes below the 20-day moving average crossing would temper the near-term friendly outlook in the market. If it renews this month's rally, March's high crossing is the next upside target.

USD/JPY closed higher due to short covering on Thursday as the dollar weakened. The high-range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are turning bullish signalling that sideways to higher prices are possible near-term. Closes below the 20-day moving average crossing would temper the near-term friendly outlook in the market. If it renews this month's rally, March's high crossing is the next upside target.

Market Commentary

2009-05-19T06:25:00.000+01:00

MARKET COMMENTARY ON 19TH MAY 2009

GBP/USD closed higher on Monday and the high-range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. If June extends the rally off April's low, December's high crossing at 1.5545 is the next upside target. Closes below the 20-day moving average crossing at 1.4957 would confirm that a short-term top has been posted.

EU/USD closed higher due to short covering on Monday and above the 10-day moving average crossing at 1.3520. The high-range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI are turning bearish signaling that additional profit taking is possible near-term. Closes below the 20-day moving average crossing at 1.3350 would temper the near-term friendly outlook in the market.

USD/CHF closed higher due to short covering on Monday and above the 10-day moving average crossing. The high-range close sets the stage for a steady to higher opening on Tuesday. Despite today's rebound, stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near-term. Closes below the 20-day moving average crossing would confirm that a short-term top has been posted. If June renews the rally off April's low, the 75% retracement level of last fall's rally crossing is the next upside target.

USD/CAD closed higher on Monday due to short covering as it consolidated some of last week's decline and closed above the 10-day moving average crossing. The high-range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI are turning neutral signaling that sideways trading is possible near-term. If June renews the rally off March's low, the 50% retracement level of the 2008-2009 decline crossing is the next upside target.

USD/JPY posted a key reversal down due to profit taking on Monday as it consolidated some of last week's rally. The low-range close sets the stage for a steady to lower opening on Tuesday. Stochastics and the RSI are overbought and are turning neutral hinting that a short-term top might be in or is near. Closes below the 20-day moving average crossing at 99.80 would confirm that a short-term top has been posted. If June extends this month's rally, March's high crossing at 100.25 is the next upside target.

Market Commentary

2009-05-18T06:48:00.000+01:00

MARKET COMMENTARY ON 18TH MAY 2009

GBP/USD closed lower due to profit taking on Friday. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. If June extends the rally off April's low, December's high crossing at 1.5545 is the next upside target. Closes below the 20-day moving average crossing at 1.4918 would signal that a short-term top has been posted.

EUR/USD closed sharply lower due to profit taking on Friday and below the 10-day moving average crossing at 1.3495 signaling that a double top with March's high might have been posted this week. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI are overbought and are turning neutral to bearish signaling that additional profit taking is possible near-term. Closes below the 20-day moving average crossing at 1.3325 would temper the near-term friendly outlook in the market. If June renews this month's rally, March's high crossing at 1.3700 is the next upside target.

USD/CHF closed sharply lower due to profit taking on Friday and below the 10-day moving average crossing signaling that a short-term top has likely been posted. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI are overbought and are turning bearish signaling that sideways to lower prices are possible near-term. Closes below the 20-day moving average crossing would confirm that a short-term top has been posted. If June extends the rally off April's low, the 75% retracement level of last fall's rally crossing is the next upside target.

USD/CAD closed lower on Friday as it extended this week's decline below the 10-day moving average crossing. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near-term. Closes below the 20-day moving average crossing would confirm that a short-term top has been posted.

USD/JPY closed higher on Friday as it extended this week's rally. The high-range close sets the stage for a steady to higher opening on Monday. Stochastics and the RSI are becoming overbought but remain bullish signaling that sideways to higher prices are possible near-term. If June extends this week's rally, March's high crossing at 99.25 is the next upside target. Closes below the 20-day moving average crossing at 93.10 would confirm that a short-term top has been posted.

FOREX-Dollar hits 4-month lows, extends broad slide

2009-05-13T08:47:00.000+01:00

TOKYO, May 13 (Reuters) - The dollar hit a four-month low against a basket of currencies and a seven-week trough versus the euro on Wednesday, facing renewed selling amid a recovery in risk appetite that has curbed safe-haven buying of dollars.

Traders said the dollar also came under pressure due to an article in the Financial Times that touched on the risk of the United States losing its triple-A credit rating and refocused attention on rising U.S. debt issuance.

While the content of the FT opinion piece was unsurprising it added to pressure on the dollar, which was already looking vulnerable on technical charts, traders said.

"I think the market overall wanted to test the (dollar's) downside and the FT story linked well with that trend," said a trader for a Japanese trust bank.

The recent recovery in risk appetite and falls in dollar funding costs point to a decline in market players' demand for dollars, leaving the U.S. currency vulnerable, said Takahide Nagasaki, chief foreign exchange strategist for Daiwa Securities SMBC.

"Concerns related to dollar funding have receded somewhat, and the focus turned towards topics that are negative for the United States such as the fiscal deficit," Nagasaki said.

The dollar index, which measures its performance against a basket of six currencies, hit a four-month low of 81.871 .DXY. After trimming some losses, it was down 0.2 percent on the day at 82.140.

Last week, the dollar index breached support at the 200-day moving average while the euro broke above a similar moving average against the dollar.

In addition, the dollar breached key support against the yen earlier this week, when it fell below the top of the cloud on daily Ichimoku charts.

The euro hit a seven-week high of $1.3722 on trading platform EBS, but after shedding some gains it was up 0.2 percent from late U.S. trading on Tuesday at $1.3674 .

FOREX-Yen gains as nerves set in about US stress tests

2009-05-06T08:57:00.000+01:00

LONDON, May 6 (Reuters) - The yen gained broadly on Wednesday, while the dollar edged up versus the euro, as nervousness ahead of U.S. stress test results on banks encouraged investors to pare back exposure to risk.

Concerns about these results, which are due on Thursday, were heightened after a source familiar with the tests said Bank of America required as much as $34 billion in additional capital.

This prompted investors to buy back the yen and the dollar -- which typically gain in times of heightened risk aversion -- after recent optimism that the global economy may be over the worst had led them to take on more risk.

The single currency pared some losses after a better-than-expected survey on the euro zone services sector, but wariness about event risks this week kept it in negative territory against both the U.S. and Japanese currencies.

As well as the stress tests, markets were cautious ahead of Thursday's policy decisions by the European Central Bank and the Bank of England and key U.S. jobs data on Friday.

Later on Wednesday, investors will be watching out for U.S. ADP unemployment data, which could provide some clues on how bad the state of the U.S. jobs market is.

"There is still some bullish news around and there have been some bright sparks recently, but people are wary that there could be things waiting around the corner to trip things up," CMC Markets analyst James Hughes said.

"The stress test results will be key as there is still a lot of underlying nervousness surrounding the banking sector," he added.

Market Commentary

2009-05-05T06:20:00.000+01:00

MARKET COMMENTARY ON 05TH MAY 2009

GBP/USD closed higher on Monday and above the 20-day moving average crossing confirming that a short-term high has been posted. The high-range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI are bullish signalling that sideways to higher prices are possible near-term. If it extends last week's rally, the reaction high crossing is the next upside target. Closes below the 10-day moving average crossing would confirm that a short-term bottom has been posted.

EUR/USD closed higher on Monday and above the 20-day moving average crossing confirming that a short-term high has been posted. The high-range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI are bullish signalling that sideways to higher prices are possible near-term. If it extends last week's rally, the reaction high crossing is the next upside target. Closes below the 10-day moving average crossing would confirm that a short-term bottom has been posted.

USD/CHF closed higher on Monday and above the 20-day moving average crossing confirming that a short-term high has been posted. The high-range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI are bullish signalling that sideways to higher prices are possible near-term. If it extends last week's rally, the reaction high crossing is the next upside target. Closes below the 10-day moving average crossing would confirm that a short-term bottom has been posted.

USD/JPY closed higher on Monday and above the 20-day moving average crossing confirming that a short-term high has been posted. The high-range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI are bullish signalling that sideways to higher prices are possible near-term. If it extends last week's rally, the reaction high crossing is the next upside target. Closes below the 10-day moving average crossing would confirm that a short-term bottom has been posted.

FOREX-Dollar slides broadly as risk demand picks up

2009-04-30T07:32:00.002+01:00

LONDON, April 30 (Reuters) - The dollar fell broadly on Thursday, hitting a three-week low against a basket of currencies as speculation that the global economic downturn is slowing continued to raise demand for riskier assets.

Concerns about the spread of swine flu waned on the view that the disease thus far would have limited economic impact, and a report of an imminent bankruptcy filing by Chrysler did little to stifle the risk rally, with analysts saying that markets have already priced in the U.S. automaker's failure.

The euro climbed along with high yielders as investors looked beyond a weak headline reading of U.S. growth and focussed on signs the economy may pick up in the coming months, which boosted currencies perceived to be higher risk.

"We've seen the stabilisation in the market, so the downside momentum is slowing, that is what the leading indicators are telling us, be it in the U.S. or the euro zone," said Michael Klawitter, senior forex strategist at Dresdner Kleinwort in Frankfurt.

"Despite the discussion of swine flu, the market no longer sees this as an economic risk, so risk aversion continues to decline, as reflected in equity markets, and in this environment, risk is to the upside."

European shares .FTEU3 rose nearly 2 percent in early trade.

Analysts said that optimistic market sentiment would likely continue so long as economic data does not significantly alter the view that the global economy is starting to show signs of recovery.

The dollar index .DXY, which tracks the U.S. currency's performance against the nation's biggest trading partners, was 0.8 percent lower at 83.948 by 0754 GMT, having fallen as low as 83.911, its lowest since early April.

Losses in the index were driven by a 0.8 percent climb in the euro to $1.3370 , which rose as high as around $1.3385 in early trade to hit its strongest in more than two weeks.

Market Commentary

2009-04-30T06:51:00.001+01:00

MARKET COMMENTARY ON 30STH APRIL 2009

GBP/USD closed higher on Wednesday as it extends the rebound off last week's low. The high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are neutral hinting that sideways to higher prices are possible near-term. Today's close above the 10-day moving average crossing at 1.4690 confirms that a short-term low has been posted. If June extends today's rally, this month's high crossing at 1.5050 is the next upside target. Closes below last week's low crossing at 1.4417 would renew the decline off April's high and could lead to a test of the reaction low crossing at 1.4175. First resistance is today's high crossing at 1.4820. Second resistance is April's high crossing at 1.5050. First support is last week's low crossing at 1.4417. Second support is the reaction low crossing at 1.4175.

EUR/USD closed higher on Wednesday renewing the rally off last week's low. The high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term. If June extends today's rally, the reaction high crossing at 1.3400 is the next upside target. Closes below last week's low would open the door for a possible test of March's low crossing at 1.2620.

USD/CHF closed higher on Wednesday renewing the rally off last week's low. The high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term. If June extends today's rally, the reaction high crossing is the next upside target.

USD/CAD closed sharply higher on Wednesday renewing the rally off last week's low. The high-range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. If June extends today's rally, April's high crossing is the next upside target. Closes below the 20-day moving average crossing would temper the friendly outlook.

USD/JPY closed lower on Wednesday due to profit taking as it consolidated some of this month's rally. The low-range close sets the stage for a steady to lower opening on Thursday. Stochastics and the RSI are overbought and are turning neutral to bearish hinting that a short-term top might be near. Closes below the 20-day moving average crossing at 97.00 would signal that a short-term top has been posted. If June extends this month's rally, March's high crossing at 99.10 is the next upside target.

Market Commentary

2009-04-29T06:12:00.000+01:00

MARKET COMMENTARY ON 29TH APRIL 2009

GBP/USD closed lower on Tuesday due to profit taking as it extends last week's trading range. The mid-range close sets the stage for a steady opening on Wednesday. Stochastics and the RSI are neutral hinting that a short-term low might be in or is near. Closes above the 10-day moving average crossing at 1.4685 are needed to confirm that a short-term low has been posted. If June renews the decline off April's high, the reaction low crossing at 1.4145 is the next downside target. First resistance is last Friday's high crossing at 1.4755. Second resistance is April's high crossing at 1.5010. First support is last week's low crossing at 1.4410. Second support is the reaction low crossing at 1.4145.

EUR/USD closed higher on Tuesday as it consolidated some of Monday's decline. The high-range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term. If June extends last week's rally, the reaction high crossing at 1.3345 is the next upside target. Closes below last week's low would open the door for a possible test of March's low crossing at 1.2575.

USD/CHF closed higher on Tuesday as it consolidated some of Monday's decline. The high-range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term. If June renews last week's rally, the reaction high crossing at 1.1565 is the next upside target.

USD/CAD closed slightly higher on Tuesday as it consolidates above the 10-day moving average. The high- range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. If June renews last week's rally, April's high crossing is the next upside target. Closes below the 20-day moving average crossing would temper the friendly outlook.

USD/JPY closed higher on Tuesday as it extends this month's decline. Profit taking tempered early gains and the low-range close sets the stage for a steady to lower opening on Wednesday. Stochastics and the RSI are neutral to bullish but are overbought hinting that a short-term top might be near. If June extends this month's rally, March's high crossing at 101.10 is the next upside target. Closes below the 20-day moving average crossing at 99.20 would signal that a short-term top has been posted.

Euro May Decline to 10-Week Low Against Yen: Technical Analysis

2009-04-28T08:29:00.000+01:00

April 28 (Bloomberg) -- The euro may decline to a 10-week low against the yen after falling below so-called support at 126.42, said Tsutomu Soma, a bond and currency dealer at Okasan Securities Co., citing trading patterns.

Support at 126.42 yen represents the neckline of a so- called “head-and-shoulders” pattern, which was completed when the euro closed at 126.14 yen yesterday, Tokyo-based Soma said. A head and shoulders is formed when a currency makes three consecutive peaks, with the middle being the highest. The neckline is drawn across the base of the three peaks.

“The euro-yen has broken below the neckline of the head and shoulders, which means it’ll probably go down more,” Soma said. “The target is around 115.38 yen.”

Europe’s single currency dropped to 124.59 yen as of 7:39 a.m. in London from 126.14 yen in New York yesterday. It earlier reached 124.54 yen, the lowest level since March 12. The 115.38 yen level was last seen on Feb. 12, according to data compiled by Bloomberg.

In technical analysis, investors and analysts study charts of trading patterns and prices to forecast changes in a security, commodity, currency or index. Support is a level where buy orders may be clustered and resistance is where there may be sell orders.

FOREX-Yen jumps on US bank concerns, flu fears

2009-04-28T08:26:00.002+01:00

LONDON, April 28 (Reuters) - The yen jumped to a seven-week high against the euro and a one-month peak against the dollar on Tuesday, on a report that regulators have told Bank of America (BAC.N) and Citigroup (C.N) they may need to raise more capital.

The yen extended gains as the report intensified investors' aversion to risk, already heightened by fears of a flu pandemic hampering any recovery in the global economy.

Higher yielding currencies such as the Australian and New Zealand dollars came under pressure.

The Wall Street Journal said regulators have told Citigroup and Bank of America they may need to raise more capital based on early results of government stress tests on banks.

The results of these tests are set to be unveiled on May 4.

"All this results in a higher risk perception, which is why we are seeing a stronger yen," Commerzbank currency strategist in Frankfurt Lutz Karpowitz said.

At 0755 GMT, the dollar slid 0.8 percent against the yen to 95.87 yen , just shy of an earlier one-month low of 95.63.

The euro lost 0.8 percent against the Japanese currency to 124.81 yen , having hit a seven-week low around 124.38 yen. The yen's gains were helped by steep falls in equities, with European stocks tumbling 2.3 percent .FTEU3.

Against the dollar, the euro was steady at $1.3020 .

The Australian dollar fell 1.2 percent against its U.S. counterpart , while the New Zealand dollar lost 1.6 percent .

FOREX-Yen jumps on US bank concerns, flu fears

2009-04-28T08:26:00.001+01:00

The yen extended gains as the report intensified investors' aversion to risk, already heightened by fears of a flu pandemic hampering any recovery in the global economy.

Higher yielding currencies such as the Australian and New Zealand dollars came under pressure.

The Wall Street Journal said regulators have told Citigroup and Bank of America they may need to raise more capital based on early results of government stress tests on banks.

The results of these tests are set to be unveiled on May 4.

"All this results in a higher risk perception, which is why we are seeing a stronger yen," Commerzbank currency strategist in Frankfurt Lutz Karpowitz said.

At 0755 GMT, the dollar slid 0.8 percent against the yen to 95.87 yen , just shy of an earlier one-month low of 95.63.

Against the dollar, the euro was steady at $1.3020 .

The Australian dollar fell 1.2 percent against its U.S. counterpart , while the New Zealand dollar lost 1.6 percent .

Market Commentary

2009-04-28T06:16:00.001+01:00

MARKET COMMENTARY ON 28TH APRIL 2009

GBP/USD closed lower on Monday due to profit taking as it extends last week's trading range. The high-range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI are turning neutral hinting that a short-term low might be in or is near. Closes above the 10-day moving average crossing at 1.4720 are needed to confirm that a short-term low has been posted. If June extends the decline off April's high, the reaction low crossing at 1.4130 is the next downside target. First resistance is last Friday's high crossing at 1.4750. Second resistance is April's high crossing at 1.5045. First support is last week's low crossing at 1.4410. Second support is the reaction low crossing at 1.4130.

EUR/USD closed lower on Monday as it consolidated some of last week's rally. The low-range close sets the stage for a steady to lower opening on Tuesday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term. If June extends last week's rally, the reaction high crossing at 1.3385 is the next upside target. Closes below last week's low would open the door for a possible test of March's low crossing at 1.2660.

USD/CHF closed sharply lower on Monday due to profit taking as it consolidated some of last week's rally. The low-range close sets the stage for a steady to lower opening on Tuesday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term. If June extends last week's rally, the reaction high crossing is the next upside target.

USD/CAD posted an inside day with a lower close on Monday as it consolidates some of last week's rally but remains above the 10-day moving average. The low-range close sets the stage for a steady to lower opening on Tuesday. Stochastics and the RSI are turning bullish signaling that sideways to higher prices are possible near-term. If June extends last week's rally, April's high crossing is the next upside target. Closes below the 20-day moving average crossing at would temper the friendly outlook.

USD/JPY closed higher on Monday as it extends this month's decline. The mid-range close sets the stage for a steady opening on Tuesday. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. If June extends this month's rally, the reaction high crossing at 99.70 is the next upside target. Closes below the 20-day moving average crossing 95.20 would signal that a short-term top has been posted.

Market Commentary

2009-04-27T06:14:00.000+01:00

MARKET COMMENTARY ON 27TH APRIL 2009

GBP/USD closed lower on Friday due to profit taking overnight as it consolidates some of Thursday's rally. Stochastics and the RSI remain bearish signalling that sideways to lower prices are possible near-term. If it renews last week's decline, the reaction low crossing is the next downside target. Closes above the 10-day moving average crossing would confirm that a short-term low has been posted.

EUR/USD closed higher on Friday and trading above the 20-day moving average crossing. Stochastics and the RSI have turned bullish signalling that a short-term low might be in or is near. Closes above the 20-day moving average crossing would confirm that a short- term low has been posted. If it renews this month's decline, the reaction low crossing is the next downside target.

USD/CHF closed lower on Friday and is trading below the 20-day moving average crossing. Stochastics and the RSI are turning bearish signalling that a short-term high might be in or is near. Closes below the 20-day moving average crossing are needed to confirm that a short-term high has been posted. If it renews this month's rally, March's high crossing is the next upside target.

USD/CAD closed higher on Friday and is trading above the 10-day moving average crossing. Stochastics and the RSI are turning neutral to bullish hinting that sideways to higher prices are possible near-term. Closes above the 10-day moving average crossing would temper the near-term bearish outlook in the market.

USD/JPY closed lower on Friday as it extends last week's decline. Stochastics and the RSI remain bearish signalling that sideways to lower prices are possible near-term. If it extends last week's decline, the reaction low crossing is the next downside target. Closes above last Friday's high crossing would confirm that a short-term bottom has been posted.

Market Commentary

2009-04-24T06:23:00.002+01:00

MARKET COMMENTARY ON 24TH APRIL 2009

GBP/USD closed higher due to short covering on Thursday as it consolidated some of this month's decline. The high-range close sets the stage for a steady opening on Friday. Stochastics and the RSI remain neutral to bullish signalling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing would temper the near-term bullish outlook.

EUR/USD closed higher due to short covering on Thursday as it consolidated some of this month's decline on evidence the worst of Europe’s economic slump may be over. The high-range close sets the stage for a steady opening on Friday. Stochastics and the RSI remain neutral to bullish signalling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing would temper the near-term bullish outlook.

USD/CHF closed higher due to short covering on Thursday as it consolidated some of this month's decline. The high-range close sets the stage for a steady opening on Friday. Stochastics and the RSI remain neutral to bullish signalling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing would temper the near-term bullish outlook.

USD/CAD closed higher on Thursday and is trading above the 10-day moving average crossing. The high-range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are turning neutral to bullish hinting that sideways to higher prices are possible near-term. Closes above the 10-day moving average crossing would temper the near-term bearish outlook in the market.

USD/JPY closed higher due to short covering on Thursday as it consolidated some of this month's decline. The high-range close sets the stage for a steady opening on Friday. Stochastics and the RSI remain neutral to bullish signalling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing would temper the near-term bullish outlook.

FOREX-Yen Rises Vs Dollar on U.S. Bank Jitters

2009-04-23T07:40:00.000+01:00

TOKYO, April 23 (Reuters) - The yen rose broadly on Thursday, climbing back towards a three-week high against the dollar touched the previous day, as U.S. stock futures fell and concerns about the banking sector re-emerged after disappointing earnings from Morgan Stanley.

S&P futures fell 0.3 percent SPc1 after U.S. stocks faced a late hour sell-off on Wednesday, with investors concerned about the outlook for banks ahead of the U.S. government's "stress test" results.

The Wall Street Journal reported that U.S. banks will be briefed by regulators as early as Friday on how they performed in the tests before the results are made public later.

Some estimates of banks' likely losses that were used in the stress tests were tougher than expected, the newspaper said.

That fanned fears about more losses at the banks included in the tests after some upbeat earnings reports earlier this month, prompting investors to cut riskier trades in which they had sold the yen against other majors, traders said.

"The currency market is lacking a clear direction, just as U.S. stocks are," said a trader at a Japanese bank.

"We have two big factors that are swinging the markets between optimism and pessimism: the eventual state of the troubled U.S. automakers, and the results of bank stress tests," the trader said.

The dollar fell 0.2 percent to 97.79 yen , sliding back near a three-week trough of 97.57 yen touched on Wednesday.

The euro fell 0.4 percent to 126.99 and dropped 0.1 percent to $1.2987 .

The Australian dollar gave up earlier gains against the yen and the dollar as most Asian stocks fell and metals like Shanghai copper dropped amid the bleak outlook for the global economy.

The International Monetary Fund cut growth forecasts for every major economy, in line with the fund's assessment that the world was in its deepest post-World War Two recession.

Market Commentary

2009-04-23T06:16:00.000+01:00

MARKET COMMENTARY OF 23RD APRIL 2009

GBP/USD posted an inside day with a lower on Wednesday as it extends its decline against the dollar. The low-range close sets the stage for a steady to lower opening on Thursday. Stochastics and the RSI remain neutral to bearish signalling that sideways to lower prices are possible near-term. Closes above the 10-day moving average crossing would confirm that a short-term low has been posted. If it renews this year's decline, monthly support crossing is the next downside target.

EUR/USD closed higher due to short covering on Wednesday as it consolidated some of this month's decline. The mid-range close sets the stage for a steady opening on Thursday. Stochastics and the RSI remain neutral to bullish signalling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing would temper the near-term bullish outlook.

USD/CHF closed higher due to short covering on Wednesday as it consolidated some of this month's decline. The mid-range close sets the stage for a steady opening on Thursday. Stochastics and the RSI remain neutral to bullish signalling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing would temper the near-term bullish outlook.

USD/JPY posted a key reversal and closed higher due to short covering on Wednesday as it consolidated some of this month's decline. The mid-range close sets the stage for a steady opening on Thursday. Stochastics and the RSI remain neutral to bullish signalling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing would temper the near-term bullish outlook.

Yen Rises on Concern U.S. Stress Tests May Show Crisis Not Over

2009-04-22T08:02:00.000+01:00

April 22 (Bloomberg) -- The yen rose against all 16 of the most-active currencies on speculation stress tests on the largest U.S. banks will show additional loan losses, boosting demand for the yen as a refuge from the global financial crisis.

Japan’s currency also advanced after a government report showed a slump in the nation’s exports slowed in March, ending a four-month streak of record drops and adding to signs the recession may have started to ease. Australia’s dollar slid against the greenback and the yen after a report showed the nation’s inflation rate fell to an 18-month low, giving policy makers more room to cut interest rates.

“Investors remain averse to taking on risk amid lingering worries over the financial turmoil,” said Tsutomu Soma, a bond and currency dealer at Okasan Securities Co. in Tokyo. The yen was bought because it is a “safe-haven” currency, he said.

The yen climbed to 126.99 per euro as of 7:55 a.m. in London from 127.81 in New York yesterday, when it reached 126.09, the highest level since March 16. Japan’s currency advanced to 98.22 against the dollar from 98.73.

The dollar was at $1.2931 against the euro from $1.2948 in New York yesterday. It touched $1.2889 on April 20, the strongest since March 16.

Australia’s dollar declined to 69.20 U.S. cents from 71.14 cents in New York yesterday, and dropped to 69.20 yen from 70.24 yen. New Zealand’s dollar fell to 55.77 cents from 56.40 cents, and weakened to 54.58 yen from 55.66 yen.

The British pound fell to $1.4609 versus the British pound from $1.4673 before Chancellor of the Exchequer Alistair Darling delivers today a U.K. budget with what may be the biggest deficit on record.

Market Commentary

2009-04-22T06:25:00.000+01:00

MARKET COMMENTARY ON 22ND APRIL 2009

GBP/USD closed higher due to short covering on Tuesday as it consolidated some of this month's decline. The mid-range close sets the stage for a steady opening on Wednesday. Stochastics and the RSI remain neutral to bullish signalling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing would temper the near-term bullish outlook.

EUR/USD closed higher due to short covering on Tuesday as it consolidated some of this month's decline. The mid-range close sets the stage for a steady opening on Wednesday. Stochastics and the RSI remain neutral to bullish signalling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing would temper the near-term bullish outlook. closed higher due to short covering on Tuesday as it consolidated some of this month's decline. The mid-range close sets the stage for a steady opening on Wednesday. Stochastics and the RSI remain neutral to bullish signalling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing would temper the near-term bullish outlook.

USD/CHF closed higher due to short covering on Tuesday as it consolidated some of this month's decline. The mid-range close sets the stage for a steady opening on Wednesday. Stochastics and the RSI remain neutral to bullish signalling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing would temper the near-term bullish outlook.

USD/JPY closed lower on Tuesday as it extends the decline off March's high. The low-range close sets the stage for a steady to lower opening on Wednesday. Stochastics and the RSI remain bearish signalling that sideways to lower prices are possible near-term. If it extends today's decline, the reaction low crossing is the next downside target. Closes above the 20-day moving average crossing are needed to confirm that a short-term low has been posted.

FOREX-Euro up from near 1-month lows; ZEW eyed

2009-04-21T08:37:00.001+01:00

LONDON, April 21 (Reuters) - The euro rose on Tuesday after hitting one-month lows against the dollar and yen as investors took profits, although nervousness about corporate earnings announcements and the health of banks kept gains in check.

The yen crosses and commodities currencies have taken the brunt of the impact from a steep slide in U.S. equities after Bank of America (BAC.N) reported a jump in non-performing assets, underscoring the banking sector's troubles.

The Japanese currency hit its highest since mid-March against the euro and a three-week peak against the British pound as the bank sector concerns tempered risk appetite and triggered buying back of yen.

It later retreated after its gains cleared out near-term sell orders for its rivals, helping the euro, sterling and the Australian dollar to recover some ground against the dollar as well, but that is likely to prove short-lived, analysts say.

"The recent correction will likely continue and we may see euro and cable and Aussie dollar pull lower in the next couple of days," said Ian Stannard, senior foreign exchange strategist at BNP Paribas.

By 0753 GMT, the euro rose 0.2 percent against the dollar to $1.2947 , but was not far from a one-month low of $1.2888 hit on trading platform EBS on Monday.

The euro was up 0.2 percent at 126.77 yen after hitting a low of 126.10 yen on EBS.

The dollar was flat at 97.94 yen , up from a three-week low of 97.66 yen hit on Monday.

Data on Tuesday is expected to show German investor sentiment rose into positive territory for the first time in roughly two years. The ZEW think tank's economic sentiment index is forecast to rise to 1.5 in March from -3.5 the previous month.

Yen Weakens, Snaps 3-Day Gain, as Trade Deficit May Damp Demand

2009-04-21T06:55:00.001+01:00

April 21 (Bloomberg) -- The yen declined for the first time in four days against the euro and the dollar before a government report tomorrow that may show Japan posted a trade deficit last month, damping the currency’s appeal.

Japan’s currency fell from a five-week high versus the euro as technical indicators showed recent gains were excessive. The euro climbed from the lowest in a month against the dollar on speculation a German report today will show investor confidence turned positive for the first time in two years. South Korea’s won slid the most in two weeks as widening U.S. credit losses tempered demand for emerging-market assets.

“The Japanese economy is in a terrible way and people are very pessimistic,” said Sean Callow, senior currency strategist in Sydney at Westpac Banking Corp., Australia’s biggest bank by market value. “If we get much further deterioration in the trade position, it should be a yen negative.”

The yen dropped to 127.38 per euro as of 6:15 a.m. in London from 126.48 in New York yesterday. It gained 3 percent against the euro in the past week and earlier reached 126.09, the strongest level since March 16. Japan’s currency declined to 98.37 per dollar from 97.89, and weakened to 69.11 against Australia’s dollar from 68.20.

The greenback traded at $1.2952 per euro from $1.2921 yesterday, when it reached $1.2889, the highest level since March 16. The won fell 1.2 percent, the most since April 8, to 1,350.25 per dollar.

Trade Deficit

The yen weakened against 15 of the 16 most-traded currencies before Japan’s finance ministry releases its trade report in Tokyo tomorrow. The nation had a trade deficit of 27 billion yen ($275 million) in March, the fifth shortfall in six months, according to a Bloomberg News survey of economists.

The yen fell from a five-week high versus the euro as the European currency’s 14-day stochastic oscillator against Japan’s dropped to 11 today, below the 20 level that signals the euro may have fallen too quickly and is poised to strengthen.

“There’s a sense the yen has been overbought,” said Toshihiko Sakai, head of trading for foreign exchange and financial products in Tokyo at Mitsubishi UFJ Trust & Banking Corp., a unit of Japan’s largest bank. “Market participants are probably unwinding long yen positions.” A long position is a bet an asset will gain.

Market Commentary

2009-04-21T06:27:00.002+01:00

MARKET COMMENTARY ON 21ST APRIL 2009

GBP/USD closed lower on Monday as it extends the decline off March's high. The low-range close sets the stage for a steady to lower opening on Tuesday. Stochastics and the RSI remain bearish signalling that sideways to lower prices are possible near-term. If it extends today's decline, the reaction low crossing is the next downside target. Closes above the 20-day moving average crossing are needed to confirm that a short-term low has been posted.

EUR/USD closed lower on Monday as it extends the decline off March's high. The low-range close sets the stage for a steady to lower opening on Tuesday. Stochastics and the RSI remain bearish signalling that sideways to lower prices are possible near-term. If it extends today's decline, the reaction low crossing is the next downside target. Closes above the 20-day moving average crossing are needed to confirm that a short-term low has been posted.

USD/CHF closed sharply lower on Friday and below the previous reaction low crossing. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI are diverging but are bearish signalling that sideways to lower prices are possible near-term. If it extends today's decline, March's low crossing is the next downside target. Closes above the reaction high crossing would confirm that a short-term low has been posted.

USD/JPY closed higher due to short covering on Monday as it consolidated some of this month's decline. The mid-range close sets the stage for a steady opening on Tuesday. Stochastics and the RSI remain neutral to bullish signalling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing would temper the near-term bearish outlook. If it extends this month's decline, the 75% retracement level of last fall's rally crossing is the next downside target.

Euro Falls to 1-Month Low on Concern ECB Disagreement to Deepen

2009-04-20T07:42:00.000+01:00

April 20 (Bloomberg) -- The euro fell to a one-month low against the dollar and weakened against the yen as European Central Bank policy makers disagreed on the measures needed to combat the recession.

The euro fell versus 10 of the 16 most-active currencies after ECB Executive Board member Lorenzo Bini Smaghi said the bank’s benchmark 1.25 percent interest rate is “very close” to its floor, Financial Times Deutschland reported. Two council members last week said they may support a rate under 1 percent. The Dollar Index approached the strongest level in three weeks on speculation a U.S. report today will show a gauge of the economy’s outlook improved.

“Investors fear that European policy makers aren’t doing enough to safeguard the economy,” said Danica Hampton, a currency strategist at Bank of New Zealand Ltd. in Wellington. “Any sign that the euro zone economy is deteriorating will likely add to the downward pressure on the euro.”

The euro dropped to $1.2992 as of 7:49 a.m. in London from $1.3044 in New York on April 17. It earlier declined to $1.2967, the lowest level since March 17. Europe’s currency fell to 128.53 yen from 129.33 yen, after touching 128.17, the weakest since March 30.

The yen climbed to 98.93 per dollar from 99.16 last week. It advanced to 56.10 versus the New Zealand dollar from 56.32, and rose to 71.13 versus the Australian currency from 71.64.

Market Commentary

2009-04-20T06:13:00.001+01:00

MARKET COMMENTARY ON 20TH APRIL 2009

GBP/USD closed lower on Friday due to profit taking as it consolidated some of this month's decline. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI are overbought and are turning neutral hinting that a short-term top might be in or is near. Closes below the 20-day moving average crossing at 1.4630 are needed to confirm that a short-term top has been posted. If June extends the rally off March's low, January's high crossing at 1.5280 is the next upside target. First resistance is Monday's high crossing at 1.4960. Second resistance is January's high crossing at 1.5280. First support is today's low crossing at 1.4755. Second support is the 20-day moving average crossing at 1.4630.

EUR/USD closed lower on Friday as it extends the decline off March's high. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near-term. If June extends today's decline, the reaction low crossing at 1.2840 is the next downside target. Closes above the 20-day moving average crossing at 1.3330 are needed to confirm that a short-term low has been posted. First resistance is the 10-day moving average crossing at 1.3245. Second resistance is the 20-day moving average crossing at 1.3330. First support is today's low crossing at 1.3020. Second support is the reaction low crossing at 1.2840.

USD/CHF closed sharply lower on Friday and below the previous reaction low crossing. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI are diverging but are bearish signaling that sideways to lower prices are possible near-term. If June extends today's decline, March's low crossing is the next downside target. Closes above the reaction high crossing would confirm that a short-term low has been posted.

USD/CAD closed lower on Friday as it consolidates some of this month's rally but remains above the 10-day moving average. The mid-range close sets the stage for a steady opening on Monday. Stochastics and the RSI are overbought and are turning bearish signaling that a short-term top might be in or is near. Closes below the 20-day moving average crossing are needed to confirm that a short-term top has been posted. If June extends the rally, January's high crossing is the next upside target.

USD/JPY closed slightly higher due to short covering on Friday as it consolidated some of this month's decline. The mid-range close sets the stage for a steady opening on Monday. Stochastics and the RSI remain neutral to bullish signaling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing at 100.75 would temper the near-term bearish outlook. If June extends this month's decline, the 75% retracement level of last fall's rally crossing at 98.00 is the next downside target.

Euro Falls After Trichet Says ECB Must Do Everything Possible

2009-04-17T06:37:00.002+01:00

April 17 (Bloomberg) -- The euro fell to a one-month low against the dollar after European Central Bank President Jean- Claude Trichet said the central bank must do everything possible to restore confidence, signaling further interest-rate cuts.

The Dollar Index rose for a fourth day before a U.S. report today that may show consumer confidence in the world’s largest economy rose for a second month, providing signs its recession may be easing. South Korea’s won was set for a sixth weekly advance, its best winning streak in 18 months, on optimism record-low borrowing costs and government stimulus plans will help salvage an economy on the brink of recession.

“Economies around the world, particularly Europe, are still in a recession,” said Yuji Saito, head of the foreign- exchange group in Tokyo at Societe Generale SA, France’s third- largest bank. “ECB officials are increasing their rhetoric that they’ll cut rates. The bias for the euro is to the downside.”

The euro fell to $1.3090 at 6:20 a.m. in London from $1.3186 in New York yesterday. It reached $1.3068, the lowest since March 18, and was set for a second weekly loss. The currency slid to 130.22 yen from 130.90 yen. The dollar traded at 99.47 yen from 99.27 yen, and was poised for a two-week loss.

The won rose 0.1 percent to 1,330.75 per dollar, according to data compiled by Bloomberg. It touched a three-month high of 1,298.05 on April 10 and gained 0.1 percent this week.

Trichet also said in a speech in Tokyo today that any ambiguity in the direction of policy will delay a recovery in the 16-nation region’s economy, damping speculation that there is policy disagreement within the central bank.

‘Delay the Return’

“Any ambiguity in our medium-term policy direction would delay the return of sustainable prosperity, because that would undermine confidence, which is the most precious ingredient in the present circumstances,” Trichet said.

ECB council member Axel Weber said on April 15 the bank shouldn’t cut interest rates below 1 percent, putting him at odds with policy makers who say borrowing costs must fall close to zero. Council members George Provopoulos from Greece and Athanasios Orphanides of Cyprus have indicated they may support cutting the 1.25 percent target rate below 1 percent and purchasing debt securities to pump money into the economy.

The ECB probably will announce May 7 whether it will follow counterparts in the U.S. and U.K. in pumping money into the economy by purchasing assets. The central bank will lower the benchmark rate by a quarter-percentage point to 1 percent at the May meeting, according to a Bloomberg News survey of economists.

Gains in the yen were tempered on speculation a rise in Asian stocks will spur investors to buy riskier assets. The MSCI Asia-Pacific Index of regional shares rose 0.7 percent and the Nikkei 225 Stock Average climbed 1.4 percent.

‘Fear Gauge’

The VIX index, a measure of market volatility known as Wall Street’s “fear gauge,” fell as low as 34.88 yesterday, the smallest figure since Sept. 26, indicating traders are becoming more confident about stock market advances.

“When investors are in the mood to take on risk, they sell the yen and the dollar,” said Michiyoshi Kato, senior vice president of foreign-currency sales in Tokyo at Mizuho Corporate Bank Ltd., a unit of Japan’s second-largest bank by assets.

The Dollar Index advanced as economists estimated the Reuters/University of Michigan preliminary index of consumer sentiment increased to 58.5 in April from 57.3 in March, according to a Bloomberg survey. The gauge will be released at 10 a.m. in New York.

Initial jobless claims in the U.S. decreased by 53,000 to 610,000 in the week ended April 11, the fewest since January, the Labor Department said yesterday in Washington.

‘Long’ Dollar

“Traditionally, the U.S. economy picked up ahead of the U.K., Asia and the euro zone,” Benedikt Germanier, a currency strategist at UBS AG in Stamford, Connecticut, wrote in a research note yesterday. “Accordingly, we would favor to be long the U.S. dollar and the British pound against the euro.”

A long position is a bet that an asset will rise. The Dollar Index, which the ICE uses to track the greenback against the euro, yen, pound, Canadian dollar, Swiss franc and Swedish krona, rose to 85.605 from 85.227 yesterday.

Euro Falls to Lowest in a month Vs DLR after Trichet

2009-04-17T06:33:00.000+01:00

TOKYO, April 17 (Reuters) - The euro fell to its lowest in a month against the dollar on Friday, dropping below $1.3090 for the first time since mid-March and triggering sell orders that deepened its fall.

The euro fell as far as $1.3065 from just above $1.3100 after ECB President Jean-Claude Trichet said he appreciated U.S. comments that a strong dollar was in its interests.

Market Commentary

2009-04-17T06:11:00.003+01:00

MARKET COMMENTARY ON 17TH APRIL 2009

GBP/USD closed lower on Thursday despite rallying to $1.50 for the first time in three months. The mid-range close sets the stage for a steady to lower opening on Friday. Stochastics and the RSI remain bearish signalling that sideways to lower prices are possible near-term. Closes below last week's low crossing would confirm that a short-term top has been posted. If it renews last week's rally, March's high crossing is the next upside target.

EUR/USD closed lower on Thursday as it consolidates last week's rally. The mid-range close sets the stage for a steady to lower opening on Friday. Stochastics and the RSI remain bearish signalling that sideways to lower prices are possible near-term. Closes below last week's low crossing would confirm that a short-term top has been posted. If it renews last week's rally, March's high crossing is the next upside target.

USD/CHF closed lower on Thursday as it lost momentum versus the dollar. The mid-range close sets the stage for a steady to lower opening on Friday. Stochastics and the RSI remain bearish signalling that sideways to lower prices are possible near-term. Closes below last week's low crossing would confirm that a short-term top has been posted. If it renews last week's rally, March's high crossing is the next upside target.

USD/JPY closed lower on Thursday as it lost momentum versus the dollar. The mid-range close sets the stage for a steady to lower opening on Friday. Stochastics and the RSI remain bearish signalling that sideways to lower prices are possible near-term. Closes below last week's low crossing would confirm that a short-term top has been posted. If it renews last week's rally, March's high crossing is the next upside target.

Asian Shares Pare Gains after China Disappoints

2009-04-16T06:38:00.000+01:00

HONG KONG (Reuters) - Asian stocks pulled back from a six-month high on Thursday, while the safe-haven yen gained after China posted its slowest ever quarterly growth in a signal of the frailty of the global economy.

A day after a mixed set of economic data from the United States, it was China's turn, saying its economy grew a slower-than-expected 6.1 percent in the first quarter, but posting other data, such as industrial output, that signaled some optimism.

After an impressive month-long rally in global equities investors still appear conflicted between seeing glimmers of hope that the world economic downturn is showing signs of easing and other indicators that point to more pain ahead.

Riskier assets, such as oil, also pared gains but not by too much, helped as well by speculation that China could implement a new stimulus package reinforced hopes that policy maker worldwide are in battle mode amidst the worst global downturn in decades.

Central bankers are cutting interest rates and flooding liquidity into financial systems, further reinforcing some of these hopes.

"No doubt China has felt the ramifications of the global crisis and growth has moderated, but the economy is showing signs of stabilizing and we can expect a recovery in the second half," said Su-Lin ong, a senior economist at RBC Capital Markets in Sydney.

The MSCI index of Asia-Pacific stocks outside Japan gained 0.8 percent as of 0245 GMT. The index had gained as much as 2.1 percent earlier in the day that brought it to its highest since October 15.

Contributing to the reversal, indexes in Hong Kong erased earlier gains to edge lower, while shares in Shanghai were down 0.5 percent.

However, other major indexes maintained their strength, with South Korea and Taiwan up nearly 2 percent each.

Japan's Nikkei average was up 2.9 percent.

Contradictory signals are also afflicting the U.S. economy.

On Wednesday, data showed U.S. consumer prices in March posted their first 12-month drop in nearly 54 years, while industrial production slipped further. However, other reports suggest the steep descent in the world's largest economy may be slowing.

The Federal Reserve said economic activity in some parts of the economy appeared to be stabilizing, and other data showed that a decline in factory activity in New York state eased this month and that national homebuilder sentiment jumped.

The yen benefited from the uncertainty, as it typically does at times of volatility, while investors sold riskier currencies.

Market Commentary

2009-04-16T06:15:00.000+01:00

MARKET COMMENTARY ON 16TH APRIL 2009

GBP/USD closed higher on Wednesday as it extends this week's rally. The high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI remain bearish signalling that sideways to lower prices are possible near-term. Closes below last week's low crossing would confirm that a short-term top has been posted. If it renews last week's rally, March's high crossing is the next upside target.

EUR/USD closed lower on Wednesday as it consolidates some of this week's rally. The mid-range close sets the stage for a steady to lower opening on Thursday. Stochastics and the RSI remain bearish signalling that sideways to lower prices are possible near-term. Closes below last week's low crossing would confirm that a short-term top has been posted. If it renews last week's rally, March's high crossing is the next upside target.

USD/CHF closed lower on Wednesday as it continues to consolidate Monday's rally. The mid-range close sets the stage for a steady to lower opening on Thursday. Stochastics and the RSI remain bearish signalling that sideways to lower prices are possible near-term. Closes below last week's low crossing would confirm that a short-term top has been posted. If it renews last week's rally, March's high crossing is the next upside target.

USD/JPY closed lower on Wednesday as it consolidates some of this week's rally. The mid-range close sets the stage for a steady to lower opening on Thursday. Stochastics and the RSI remain bearish signalling that sideways to lower prices are possible near-term. Closes below last week's low crossing would confirm that a short-term top has been posted. If it renews last week's rally, March's high crossing is the next upside target.

Asia Stocks Retreat, China Hopes Limit Drop

2009-04-15T06:55:00.000+01:00

HONG KONG (Reuters) - Asian stocks pulled back from six-month highs on Wednesday but held up after the drop on Wall Street overnight, with hopes for more Chinese stimulus spending helping offset reports of weak first-quarter growth.

Investors were cashing in on gains after many equity markets have jumped between 20 percent and 30 percent since early March, with Asian markets leading the charge higher as investors counted on China helping drive a regional growth pick-up, analysts said.

Higher-yielding currencies such as the Australian dollar relinquished some of their hefty gains in the past month after data showing a surprisingly big drop in U.S. retail sales last month highlighted the bumpy road to recovery in the recession-hit global economy.

But gains in safe-have government bonds were limited as investors fret about the wave of coming supply to fund government spending aimed at reviving growth, as well as signs that Asian central banks may have finished with their aggressive rate cuts.

The Shanghai Composite index -- the world's best performing market this year after being the hardest hit in 2008 -- held up the best, dipping just 0.5 percent.

A report on the Shanghai Securities News website said that Chinese annual economic growth, due to be released on Thursday, was between 6.0 percent and 6.8 percent in the January-March quarter, what would be the lowest on quarterly records going back to 1992.

Speculation has been rife in the past few days that China might announce a new package focused on boosting consumer spending on top of the $585 billion plan aimed at infrastructure spending.

"Investors are being more cautious, wanting to confirm quarterly results and outlook comments before making investment decisions," said Kim Joon-kie, a market analyst at SK Securities in Seoul.

The MSCI index of Asia-Pacific stocks outside Japan fell 1.1 percent, led by a drop in consumer discretionary and technology shares -- some of the biggest gainers in the rally.

On Tuesday the U.S. S&P 500 shed 2 percent, and S&P futures were pointing to further losses with a drop of 0.6 percent in Asia.

After the closing bell, Intel Corp said the worst was over for the battered tech sector but its shares tumbled after it failed to give a clear revenue forecast, citing the economic uncertainty.

U.S. corporate earnings season has kicked into high gear this week, stirring some caution among investors.

Japan's Nikkei average fell 0.8 percent, pulling further away from a three-month peak reached last week.

Market Commentary

2009-04-15T06:17:00.000+01:00

MARKET COMMENTARY ON 15TH APRIL 2009

GBP/USD closed higher on Tuesday as it extends Monday's rally, breaking out above March's high crossing. The high-range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI remain bearish signalling that sideways to lower prices are possible near-term. Closes below last week's low crossing would confirm that a short-term top has been posted. If it renews last week's rally, March's high crossing is the next upside target.

EUR/USD closed lower on Tuesday as it consolidates some of Monday's rally. The mid-range close sets the stage for a steady to lower opening on Wednesday. Stochastics and the RSI remain bearish signalling that sideways to lower prices are possible near-term. Closes below last week's low crossing would confirm that a short-term top has been posted. If it renews last week's rally, March's high crossing is the next upside target.

USD/CHF closed lower on Tuesday as it consolidates some of Monday's rally. The mid-range close sets the stage for a steady to lower opening on Wednesday. Stochastics and the RSI remain bearish signalling that sideways to lower prices are possible near-term. Closes below last week's low crossing would confirm that a short-term top has been posted. If it renews last week's rally, March's high crossing is the next upside target.

USD/JPY closed higher on Tuesday as it extends Monday's rally. The high-range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI remain bearish signalling that sideways to lower prices are possible near-term. Closes below last week's low crossing would confirm that a short-term top has been posted. If it renews last week's rally, March's high crossing is the next upside target.

Asian Shares Advance Despite Plenty of Fears

2009-04-14T07:24:00.000+01:00

HONG KONG (Reuters) - Asian shares rose to a six-month high on Tuesday after Goldman Sachs' stronger-than-expected profit signaled the worst could be behind for U.S. banks, emboldening investors to chase after riskier assets.

Asian credit markets continued to improve, while the yen, a currency that benefits during fearful times, fell to a six-month low against the Australian dollar.

However, there are also plenty of doubts about how much longer the rally in Asian stock markets can be sustained given that some analysts believe the full brunt of the deep global recession has yet to be reflected.

Singapore eased monetary policy to effectively devalue its currency after posting on Tuesday its worst quarterly economic contraction ever, while a forecast for weaker demand for oil by the International Energy Agency sent crudes tumbling to below $50 a barrel.

Asian automaker shares slid on fears General Motors Corp (GM.N) was being pushed into bankruptcy by the U.S. government, helping send Japan's Nikkei average .N225 down 1.3 percent.

"If GM were to go bankrupt, that would raise questions about what would happen to Japanese auto-parts makers and Japanese automakers' dealer networks. The implications are broad," said Takahiko Murai, general manager of equities at Nozomi Securities.

"Although the financial sector seems to have seen the worst, a recovery for manufacturers has been slow and worries remain."

The MSCI index of Asia-Pacific stocks outside Japan .MIAPJ0000PUS at one point hit its highest since mid-October, when shares were in the midst of a slide following the collapse of Lehman Brothers in the previous month.

The MSCI gauge was up 1.5 percent as of 0240 GMT, as major markets such as in Hong Kong .HSI and Australia .AXJO gained more than 2 percent each after a four-day weekend also seen in other Asian countries.

The gains came after Goldman Sachs Group Inc (GS.N) on Monday posted much higher-than-expected first-quarter profit as it took more trading risk, and said it plans a $5 billion common share sale to help pay back government funds.

The results followed Wells Fargo & Co's (WFC.N) surprising announcement last week that it expects to report a record first-quarter profit.

Though Goldman and Wells Fargo did not suffer as much as other U.S. financial firms, at least their announcements were seen providing some signs the U.S. banking industry is finally stabilizing after months of credit-related losses.

Markets in South Korea , Taiwan and Shanghai .SSEC were largely unchanged on the day.

Market Commentary

2009-04-14T06:18:00.001+01:00

MARKET COMMENTARY ON 14TH APRIL 2009

GBP/USD closed higher on Monday as it extends last week's decline. The high-range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI are overbought and are neutral to bearish signalling that sideways to higher prices are possible near-term. Closes below the 20-day moving average crossing are needed to confirm that a short-term top has been posted. If it extends the rally off March's low, January's high crossing is the next upside target.

EUR/USD closed lower on Monday and below the 20-day moving average crossing. The low-range close sets the stage for a steady to lower opening on Tuesday. Stochastics and the RSI are bearish signalling that sideways to lower prices are possible near-term. Closes below last Monday's low crossing are needed to confirm that a short-term top has been posted. If it renews last week's rally, March's high crossing is the next upside target.

USD/CHF closed higher on Monday and below the 20-day moving average crossing. The high-range close sets the stage for a steady to higher opening on Teusday. Stochastics and the RSI remain bearish signalling that sideways to lower prices are possible near-term. Closes below last Monday's low crossing would confirm that a short-term top has been posted. If it renews last week's rally, March's high crossing is the next upside target.

USD/JPY closed higher on Monday as it consolidated some of this month's decline. The high-range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI are oversold but are neutral to bullish signalling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing would temper the near-term bearish outlook. If it extends this month's decline, the 75% retracement level of last fall's rally crossing is the next downside target.

FOREX-Dollar edges up Vs Yen before US Bank earnings

2009-04-13T06:33:00.000+01:00

TOKYO, April 13 (Reuters) - The dollar edged up against the yen in quiet trade on Monday with many overseas players still away for the Easter holiday and others waiting until the U.S. corporate earnings season gets into full swing.

U.S. banks including Goldman Sachs (GS.N), JPMorgan (JPM.N) and Citigroup (C.N) are set to report first-quarter results this week, and traders are keen to see how stock markets react to these earnings reports.

But after a relaxation of industry accounting standards, analysts say it will be difficult to gauge losses from bad loans in areas like real estate and consumer credit. "Market participants generally stayed on the sidelines before the U.S. bank earnings and they are waiting for stocks' moves following the results," said a dealer at a Japanese bank.

Last week, the dollar rose against the yen, buoyed by a rally in U.S. shares after positive earnings guidance from U.S. bank Wells Fargo (WFC.N). "If U.S. earnings results show signs that the U.S. is pulling away from the worst of the economic downturn, risk appetite is expected to grow, putting pressure on the yen," said Yoshihisa Kanzaki, a currency dealer at Shinkin Central Bank.

Others said the currency market has priced in positive U.S. earnings figures, so downward pressure on the yen could be limited even if the results are better than expected, and that the market is more likely to swayed by negative surprises.

The dollar was trading around 100.37 yen compared with 100.22 yen in late Tokyo trading on Friday. The U.S. currency touched 101.45 yen last week, its highest in six months.

The euro was quoted at $1.3165 , down from $1.3186 on Friday when it also slipped to $1.3090, a level not seen since mid-March.

Against the yen, the euro was at 132.16 yen , down from 132.24 yen. It climbed to 137.42 yen last week, its highest point in six months.

The Australian dollar rose above 73.00 yen , the highest since October, before falling back to 72.51 yen.

Market Commentary

2009-04-13T06:15:00.001+01:00

MARKET COMMENTARY ON 13TH APRIL 2009

GBP/USD closed lower on Thursday as it extends last week's decline. The mid-range close sets the stage for a steady opening on Monday. Stochastics and the RSI are overbought and are neutral to bearish signalling that sideways to higher prices are possible near-term. Closes below the 20-day moving average crossing are needed to confirm that a short-term top has been posted. If it extends the rally off March's low, January's high crossing is the next upside target.

EUR/USD closed lower on Thurs and below the 20-day moving average crossing. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI are bearish signalling that sideways to lower prices are possible near-term. Closes below last Monday's low crossing are needed to confirm that a short-term top has been posted. If it renews last week's rally, March's high crossing is the next upside target.

USD/CHF closed higher on Thursday and below the 20-day moving average crossing. The high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI remain bearish signalling that sideways to lower prices are possible near-term. Closes below last Monday's low crossing would confirm that a short-term top has been posted. If it renews last week's rally, March's high crossing is the next upside target.

USD/JPY closed higher on Thursday as it consolidated some of this month's decline. The high-range close sets the stage for a steady to higher opening on Monday. Stochastics and the RSI are oversold but are neutral to bullish signalling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing would temper the near-term bearish outlook. If it extends this month's decline, the 75% retracement level of last fall's rally crossing is the next downside target.

Market Commentary

2009-04-09T06:11:00.002+01:00

MARKET COMMENTARY 09TH APRIL 2009

GBP/USD posted an inside day with a lower close on Wednesday as it extends this week's decline. The mid-range close sets the stage for a steady opening on Thursday. Stochastics and the RSI are overbought and are turning neutral to bearish signaling that sideways to higher prices are possible near-term. Closes below the 20-day moving average crossing at 1.4435 are needed to confirm that a short-term top has been posted. If June extends the rally off March's low, January's high crossing at 1.5150 is the next upside target. First resistance is Monday's high crossing at 1.4962. Second resistance is January's high crossing at 1.5150. First support is the 10-day moving average crossing at 1.4555. Second support is the 20-day moving average crossing at 1.4435.

EUR/USD closed lower on Wednesday as it extends Tuesday's close below the 20-day moving average crossing at 1.3330. The mid-range close sets the stage for a steady opening on Thursday. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near-term. Closes below last Monday's low crossing at 1.3150 are needed to confirm that a short-term top has been posted.

USD/CHF closed lower on Wednesday and below the 20-day moving average crossing. The low-range close sets the stage for a steady to lower opening on Thursday. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near-term. Closes below last Monday's low crossing would confirm that a short-term top has been posted. If June renews last week's rally, March's high crossing is the next upside target.

USD/CAD closed slightly higher on Wednesday as it consolidates above the 10-day moving average. The high- range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI remain neutral to bullish signaling that sideways to higher prices are possible near-term. If June extends the rally, March's high crossing is the next upside target. Closes below last Wednesday's low crossing are needed to confirm that a short-term top has been posted.

USD/JPY closed higher due to short covering on Wednesday as it consolidated some of this month's decline. The high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are oversold but are turning neutral to bullish signaling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing at 101.75 would temper the near-term bearish outlook. If June extends this month's decline, the 75% retracement level of last fall's rally crossing at 98.10 is the next downside target.

Market Commentary

2009-04-08T06:09:00.002+01:00

MARKET COMMENTARY ON 08TH APRIL 2009

GBP/USD closed higher due to short covering on Tuesday as it consolidated some of Monday's decline. The high- range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. If June extends the rally off March's low, January's high crossing at 1.5280 is the next upside target. Closes below the 20-day moving average crossing at 1.4400 are needed to confirm that a short-term top has been posted. First resistance is Monday's high crossing at 1.4960. Second resistance is January's high crossing at 1.5280. First support is the 10-day moving average crossing at 1.4535. Second support is the 20- day moving average crossing at 1.4400.

EUR/USD closed lower on Tuesday and below the 20-day moving average crossing at 1.3300. The low-range close sets the stage for a steady to lower opening on Wednesday. Stochastics and the RSI are neutral to bearish signaling that sideways to lower prices are possible near-term. Closes below last Monday's low crossing at 1.3120 are needed to confirm that a short- term top has been posted.

USD/CHF closed lower on Tuesday as it extended Monday's decline. The mid-range close sets the stage for a steady opening on Wednesday. Stochastics and the RSI are neutral to bearish signaling that sideways to lower prices are possible near- term. Closes below the 20-day moving average crossing would confirm that a short-term top has been posted. If June extends last week's rally, March's high crossing is the next upside target.

USD/CAD closed higher on Tuesday as it consolidates above the 10-day moving average. The high-range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term. If June extends the rally, March's high crossing is the next upside target. Closes below last Wednesday's low crossing would confirm that a short-term top has been posted.

USD/JPY closed higher due to short covering on Tuesday as it consolidated some of this month's decline. The mid-range close sets the stage for a steady opening on Wednesday. Stochastics and the RSI remain neutral to bearish signaling that sideways to lower prices are possible near-term. If June extends this month's decline, the 75% retracement level of last fall's rally crossing at 98.10 is the next downside target. Closes above the 20-day moving average crossing at 101.50 would temper the near-term bearish outlook.

Market Commentary

2009-04-07T06:09:00.002+01:00

MARKET COMMENTARY ON 07TH APRIL 2009

GBP/USD closed lower due to profit taking on Monday as it consolidated some of last week's rally. The low-range close sets the stage for a steady to lower opening on Tuesday. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. If June extends the week's rally, January's high crossing at 1.5270 is the next upside target. Closes below the 20-day moving average crossing at 1.4349 are needed to confirm that a short-term top has been posted. First resistance is today's high crossing at 1.4960. Second resistance is January's high crossing at 1.5270. First support is the 10-day moving average crossing at 1.4530. Second support is the 20-day moving average crossing at 1.4349.

EUR/USD closed lower due to profit taking on Monday as it consolidated some of last week's rally but remains above the 10-day moving average crossing at 1.3390. The low-range close sets the stage for a steady to lower opening on Tuesday. Stochastics and the RSI have turned bullish signaling that sideways to higher prices are possible near-term. If June extends last week's rally, March's high crossing at 1.3730 is the next upside target. Closes below last Monday's low crossing at 1.3120 are needed to confirm that a short-term top has been posted.

USD/CHF posted a key reversal down on Monday as it consolidated some of last week's rally. The low-range close sets the stage for a steady to lower opening on Tuesday. Stochastics and the RSI are neutral to bullish signaling that sideways to higher prices are still possible. If June extends last week's rally, March's high crossing is the next upside target. Closes below the 20-day moving average crossing would confirm that a short-term top has been posted.

USD/CAD closed lower on Monday due to profit taking as it consolidated some of last week's rally but remains above the 10-day moving average. The low-range close sets the stage for a steady to lower opening on Tuesday. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. If June extends the rally, March's high crossing is the next upside target. Closes below last Wednesday's low crossing would confirm that a short- term top has been posted.

USD/JPY closed lower on Monday as it extends this month's decline. The low-range close sets the stage for a steady to lower opening on Tuesday. Stochastics and the RSI remain neutral to bearish signaling that sideways to lower prices are possible near-term. If June extends this month's decline, the 75% retracement level of last fall's rally crossing 98.10 is the next downside target. Closes above the 20-day moving average crossing 101.90 would temper the near-term bearish outlook.

3-mth Dollar, Euro, Sterling interbank rates slip

2009-04-06T06:59:00.002+01:00

LONDON, April 6 (Reuters) - Interbank lending rates for three-month euro, dollar and sterling funds eased on Monday, as bets that the worst of the financial market crisis may be over suggested banks may be more willing to lend. Japan said it would spend at least $100 billion more to boost its economy, while global equities and commodities extended last week's rebound.

The picture wasn't uniformly rosy, however: two-year U.S. interest rate swaps spreads widened slightly and euro zone banks' overnight deposits at the European Central Bank rose to their highest in a month.

Three-month euro deposit rates were indicated between 1.20 and 1.43 percent versus 1.20-1.46 percent early in London on Friday.

Three-month dollar deposit rates were indicated in a range of between 1.10 and 1.45 percent, compared with 1.20-1.45 percent while three-month sterling funds were quoted in a 1.05-1.40 percent range compared with 1.38-1.48 percent.

Interbank deposit rates are only indicative prices of where banks are lending to each other, which institutions use as a base to set their own lending rates.

Market Commentary

2009-04-06T06:10:00.001+01:00

MARKET COMMENTARY ON 06TH APRIL 2009

GBP/USD closed higher on Friday as it extended this week's rally. The high-range close sets the stage for a steady to higher opening on Monday. Stochastics and the RSI have turned bullish signaling that sideways to higher prices are possible near-term. If June extends this week's rally, February's high crossing at 1.4990 is the next upside target. Closes below the 20- day moving average crossing at 1.4310 are needed to confirm that a short-term top has been posted.

EUR/USD closed higher on Friday and above the 10-day moving average crossing at 1.3425 tempering the bearish outlook. The high-range close sets the stage for a steady to higher opening on Monday. Stochastics and the RSI are turning bullish signaling that sideways to higher prices are possible near-term. If June extends this week's rally, March's high crossing at 1.3700 is the next upside target. Closes below Monday's low crossing at 1.3150 would confirm that a short-term top has been posted.

USD/CHF closed higher on Friday and above the 10-day moving average crossing. The high-range close sets the stage for a steady to higher opening on Monday. Stochastics and the RSI are neutral signaling that sideways trading is possible near-term. If June extends this week's rally, March's high crossing is the next upside target. Closes below the 20-day moving average crossing would confirm that a short-term top has been posted.

USD/CAD closed higher on Friday and above the 10-day moving average thereby confirming that a short-term low has been posted. The high-range close sets the stage for a steady to higher opening on Monday. Stochastics and the RSI are turning neutral to bullish signaling that sideways to higher prices are possible near-term. If June extends this week's rally, March's high crossing is the next upside target. Closes below Wednesday's low crossing would confirm that a short-term top has been posted.

USD/JPY closed higher on Friday as it extended this week's rally. The high-range close sets the stage for a steady to higher opening on Monday. Stochastics and the RSI remain neutral to bullish signaling that sideways to higher prices are possible near-term. If June extends this week's decline, the 75% retracement level of last fall's rally crossing 98.50 is the next downside target. Closes above the 20-day moving average crossing at 101.70 would temper the near-term bearish outlook.

FOREX-Yen, Dollar pare losses on caution before US jobs

2009-04-03T07:15:00.000+01:00

TOKYO, April 3 (Reuters) - The yen and the dollar fell to multi-month lows on Friday after G20 leaders boosted investor risk appetite, but later trimmed their losses as some caution returned ahead of U.S. employment figures due later in the day.

G20 leaders clinched a $1.1 trillion deal on Thursday to counter the worldwide economic crisis and the United States said it would change accounting rules to allow banks more flexibility in valuing toxic assets.

Both developments improved investors' appetite for risk and weighed on the Japanese and U.S. currencies on Friday, with the yen hitting a 5-½ month low and the dollar a three-month trough versus the Australian dollar in early trade.

The Japanese and U.S. currencies edged up, however, as the market began looking ahead to U.S. jobs figures at 1230 GMT.

The employment numbers are seen as a potential dampener of risk appetite, with economists in a Reuters survey expecting 650,000 jobs were lost and the unemployment rate hit a 26-year high of 8.5 percent in March.

"The yen selling was not sustainable before the U.S. jobs data release. Opinion may be tilted towards the yen weakening in the longer term, but the market would first like to see this major event through," said a dealer at a Japanese brokerage.

The dollar gained 0.1 percent to 99.65 yen after reaching as high as 100.18 yen on trading platform EBS, the first time it has pierced 100.00 since early November.

The euro dipped 0.4 percent to $1.3413 , after climbing 1.6 percent in the previous session, and eased 0.3 percent to 133.56 yen after climbing to a five-month high of 134.99 yen early in the day.

The euro jumped the previous day after the European Central Bank eased less than the market was braced for, cutting rates by 25 basis points to 1.25 percent instead of an expected 50 points.
The Australian dollar fell 0.4 percent to $0.7131 after touching a three-month high of $0.7230 and slipped 0.3 percent to 70.95 yen after reaching a 5-½ month high of 72.31 yen .

The dollar index, a gauge of the greenback's strength against a basket of key currencies, edged up 0.3 percent to 84.540 .DXY.

Market Commentary

2009-04-03T06:19:00.001+01:00

MARKET COMMENTARY ON 03RD APRIL 2009

GBP/USD closed higher due to short covering on Thursday as it consolidates some of yesterday's decline. The high-range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI remain neutral to bearish signalling that sideways to lower prices are possible near-term. Closes below the 20-day moving average crossing are needed to confirm that a short-term top has been posted. Closes above the 10-day moving average crossing would temper the near-term bearish outlook.

EUR/USD closed higher due to short covering on Thursday as it consolidates yesterday's decline. The high-range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI remain neutral to bearish signalling that sideways to lower prices are possible near-term. Closes below the 20-day moving average crossing are needed to confirm that a short-term top has been posted. Closes above the 10-day moving average crossing would temper the near-term bearish outlook.

USD/CHF closed higher due to short covering on Thursday as it consolidates some of Monday's decline. The high-range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI remain neutral to bearish signalling that sideways to lower prices are possible near-term. Closes below the 20-day moving average crossing are needed to confirm that a short-term top has been posted. Closes above the 10-day moving average crossing would temper the near-term bearish outlook.

USD/JPY closed lower on Thursday but remains above the 20-day moving average crossing. The mid-range close sets the stage for a steady opening on Friday. Stochastics and the RSI remain bearish signalling that sideways to lower prices are possible near-term. Closes below the 20-day moving average crossing would confirm that a short-term top has been posted. Closes above the 10-day moving average crossing would temper the near-term bearish outlook in the market.

Market Commentary

2009-04-02T06:19:00.002+01:00

MARKET COMMENTARY ON 02ND APRIL 2009

GBP/USD closed higher due to short covering on Wednesday as it consolidates some of Monday's decline. The high- range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near-term. Closes below the 20-day moving average crossing at 1.4235 are needed to confirm that a short-term top has been posted. Closes above the 10-day moving average crossing at 1.4420 would temper the near-term bearish outlook. First resistance is the 10-day moving average crossing at 1.4450. Second resistance is last Tuesday's high crossing at 1.4768. First support is the 20-day moving average crossing at 1.4235. Second support is Monday's low crossing at 1.4120.

EUR/USD closed higher due to short covering on Wednesday as it consolidates some of Monday's decline but remains below the 10-day moving average. The high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near-term. If June extends Monday's decline, the 20- day moving average crossing at 1.3125 is the next downside target. Closes below the 20-day moving average crossing at 1.3125 would confirm that a short-term top has been posted. Closes above the 10-day moving average crossing at 1.3450 would temper the near-term bearish outlook in the market.

USD/CHF closed higher on Wednesday due to short covering as it consolidates some of Monday's decline but remains below the 10-day moving average crossing. The high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near-term. Closes below the 20-day moving average crossing are needed to confirm that a short-term top has been posted. Closes above the 10- day moving average crossing would temper the near-term bearish outlook.

USD/CAD closed higher due to short covering on Wednesday as it consolidates some of Monday's decline. The low-range close sets the stage for a steady to lower opening on Thursday. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near-term. If June extends Monday's decline, the reaction low crossing is the next downside target. Closes above the Monday's high crossing would temper the near-term bearish outlook in the market.

USD/JPY closed lower on Wednesday and extended last week's decline. The low-range close sets the stage for a steady to lower opening on Thursday. Stochastics and the RSI remain neutral to bearish signaling that sideways to lower prices are possible near-term. If June extends today's decline, the reaction low crossing at 99.80 is the next downside target. Closes above the reaction high crossing at 101.70 would temper the near-term bearish outlook.

FOREX-Dollar and Yen Rise on GM Report buf off Highs

2009-04-01T07:26:00.003+01:00

TOKYO, April 1 (Reuters) - The dollar and the yen rose on Wednesday on a report that the White House was prepared to let U.S. automakers go bankrupt, but retreated from the day's highs after a U.S. administration official said it was inaccurate.

Bloomberg reported that U.S. President Barack Obama has determined that a prepackaged bankruptcy is the best way for General Motors Corp (GM.N), quoting people familiar with the matter.

But a senior U.S. administration official said President Barack Obama's thinking on the crisis facing GM has not changed since Monday, saying the report was "not accurate."

The report spurred risk aversion, prompting investors to dump the euro and other higher-yielding currencies and return to the safety of the greenback.

That also sent the yen broadly higher, a sharp turnaround as the Japanese currency had hit a one-month low versus the dollar after the Bank of Japan's tankan corporate survey showed a dire picture of an economy in recession.

"It is like a repeat of what we saw on Monday when news about the U.S. rejection of automakers' restructuring plans also hit the market in Tokyo hours and pushed dollar/yen down sharply," said a senior currency options trader at a Japanese bank.

"But the impact seems to be smaller this time as there is more optimism in the market that the U.S. economy may be bottoming out," the trader said.

Reduced investor risk appetite sent higher-yielding currencies such as the Australian dollar lower, which was also dented by data showing Australian retail sales fell by the most in nine years, adding to the case for a cut in interest rates next week.

The New Zealand dollar extended a big slide after New Zealand's central bank warned on Wednesday that a recent rise in market interest rates was unwarranted and out of sync with its view of the economy.

The dollar index, a gauge of the greenback's performance against six major currencies, rose 0.3 percent to 85.743 .DXY, but off an earlier high of 85.940.

The euro was down 0.2 percent to $1.3218 , above earlier low of $1.3173.

The dollar fell 0.4 percent from late New York trade to 98.60 yen after tumbling as low as 98.21 yen on trading platform EBS.

The dollar had gained earlier to 99.48 yen, the highest since March 5, after the BOJ's tankan survey showed confidence among Japan's big manufacturers tumbled at its fastest pace ever in the first quarter to the worst on record.

The survey highlighted the pain companies are facing as the global economic crisis scythes through Japan's exports.

The euro fell 0.6 percent to 130.30 yen after falling as low as 129.94 yen from earlier highs near 131.90 yen.

"The report about Chrysler's possible bankruptcy is now impacting the whole market," said a senior trader at a Japanese bank.

"U.S. stock futures are looking terrible after a positive close in New York, prompting market players to dump currencies they had bought against the yen," the trader said.

U.S. stock futures SPc1 fell 1.3 percent in Asian trade after a rise on Tuesday, while Tokyo shares climbed 1.5 percent .N225 with other regional stock markets also gaining.

Market Commentary

2009-04-01T06:15:00.001+01:00

MARKET COMMENTARY ON 1ST APRIL 2009

GBP/USD closed higher due to short covering on Tuesday as it consolidates some of Monday's decline. The high- range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near-term. Closes below the 20-day moving average crossing at 1.4215 are needed to confirm that a short-term top has been posted. Closes above the 10-day moving average crossing at 1.4420 would temper the near-term bearish outlook. First resistance is the 10-day moving average crossing at 1.4420. Second resistance is last Tuesday's high crossing at 1.4752. First support is the 20-day moving average crossing at 1.4215. Second support is Monday's low crossing at 1.4122.

EUR/USD closed higher due to short covering on Tuesday as it consolidates some of Monday's decline but remains below the 10-day moving average. The high-range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near-term. If June extends Monday's decline, the 20- day moving average crossing at 1.3120 is the next downside target. Closes below the 20-day moving average crossing at 1.3120 would confirm that a short-term top has been posted. Closes above the 10-day moving average crossing at 1.3440 would temper the near-term bearish outlook in the market.

USD/CHF closed higher on Tuesday due to short covering as it consolidates some of Monday's decline but remains below the 10-day moving average crossing. The high-range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near-term. Closes below the 20-day moving average crossing are needed to confirm that a short-term top has been posted. Closes above the 10- day moving average crossing would temper the near-term bearish outlook.

USD/CAD closed higher due to short covering on Tuesday as it consolidates some of Monday's decline. The low-range close sets the stage for a steady to lower opening on Wednesday. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near-term. If June extends Monday's decline, the reaction low crossing is the next downside target. Closes above the Monday's high crossing would temper the near-term bearish outlook in the market.

USD/JPY closed lower on Tuesday and extended last week's decline. The low-range close sets the stage for a steady to lower opening on Wednesday. Stochastics and the RSI remain neutral to bearish signaling that sideways to lower prices are possible near-term. If June extends today's decline, the reaction low crossing 97.50 is the next downside target. Closes above the reaction high crossing 100.20 would temper the near-term bearish outlook.

Asia Stocks Set for Biggest jump in a Decade

2009-03-31T06:29:00.000+01:00

HONG KONG (Reuters) - Asian stocks edged up on Tuesday and were set to score their biggest monthly rise in a decade as some investors bet the most painful stretch of corporate earnings damage may be over and bought Asian technology shares.

As the first quarter and Japan's financial year draws to a close, stocks, oil prices and higher-yielding currencies gained after a one-day battering on news that the U.S. government was considering pushing General Motors (GM.N) into bankruptcy.

Government bonds retreated as equity markets regained their composure, while the dollar slipped as investors favored riskier assets. Asian stocks outside Japan were set to finish the first quarter with a dip of 0.7 percent but were up 15 percent in March, what would be the largest rise since 1999.

"There has been a huge change in sentiment. Rather than anticipating huge sell-offs in the U.S., we've been anticipating rallies," said Peter Wright, a dealer with Burrell Stockbroking in Sydney. Many stock markets have thrashed in ranges near last year's lows, with investors cautious about calling a turnaround as the global economy remains mired in a deep recession.

The economic fallout from the financial crisis is still taking a big toll on many economies, with data from Japan showing unemployment rising to a three-year high as the country's grapples with its worst recession since World War Two. But Japan's Nikkei average .N225 climbed 0.9 percent, highlighting how many investors are looking beyond the bleak conditions and expect stimulus spending to help spur a recovery later in the year.

Japanese Prime Minister Taro Aso is expected to unveil the outlines of a spending package on Tuesday ahead of the Group of 20 gathering of rich and developing nations this week. The MSCI index of Asia-Pacific stocks outside Japan rose 1.4 percent and is up 27 percent from a five-year low struck last November.

The Shanghai Composite has rebounded the most in the January-March quarter with a rise of 28 percent, making its the best-performing big equity market so far this year after being the hardest hit in 2008.

The tech-heavy Taiwan Weighted index was poised to finish the quarter with a 15 percent gain, boosted by incoming orders from China as part of its hefty stimulus spending.

Shares of Taiawn's Compal Electronics (2324.TW), the world's No. 2 contract laptop PC maker, rose 4 percent after it said demand from China ,the United States and Europe is picking up and its plans to add about 30 percent more employees by June.

"In the current downturn, tech shares like Compal whose sales and profits could still keep rising, are favorable," said Andrew Deng, a vice president of Taiwan International Securities Corp in Taipei.

Market Commentary

2009-03-31T05:21:00.002+01:00

MARKET COMMENTARY ON 31ST MARCH 2009

GBP/USD closed lower on Monday and spiked below the 20-day moving average crossing at 1.4190 as it extended the decline off last week's high. A short covering rally tempered early losses and the mid-range close sets the stage for a steady opening on Tuesday. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near-term. Closes below the 20-day moving average crossing at 1.4190 are needed to confirm that a short-term top has been posted. If June renews this month's rally, February's high crossing at 1.4920 is the next upside target. First resistance is the 10-day moving average crossing at 1.4400. Second resistance is last Tuesday's high crossing at 1.4752. First support is the 20-day moving average crossing at 1.4190. Second support is today's low crossing at 1.4123.

EUR/USD closed lower on Monday as it extends last Friday's decline below the 10-day moving average. The low-range close sets the stage for a steady to lower opening on Tuesday. Stochastics and the RSI have turned bearish signaling that sideways to lower prices are possible near-term. If June extends today's decline, the 20-day moving average crossing at 1.3085 is the next downside target. Closes below the 20-day moving average crossing at 1.3085 would confirm that a short-term top has been posted.

USD/CHF closed lower on Monday as it extends last Friday's decline below the 10-day moving average crossing. The mid-range close sets the stage for a steady opening on Tuesday. Stochastics and the RSI are turning bearish signaling that sideways to lower prices are possible near-term. Closes below the 20-day moving average crossing are needed to confirm that a short-term top has been posted. If June renews this month's rally, the 62% retracement level of the December-March decline crossing is the next upside target.

USD/CAD closed sharply lower on Monday and below the 20-day moving average crossing at confirming that a short-term top has been posted. The low-range close sets the stage for a steady to lower opening on Tuesday. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near-term. If June extends today's decline, the reaction low crossing at 78.48 is the next downside target. Closes above the today's high crossing would temper the near-term bearish outlook in the market.

USD/JPY closed higher on Monday due to short covering as it consolidates some of last week's decline. The mid- range close sets the stage for a steady opening on Tuesday. Stochastics and the RSI remain neutral to bearish signaling that sideways to lower prices are possible near-term. If June extends last week's decline, the reaction low crossing at 99.70 is the next downside target. Closes above the reaction high crossing at 100.20 would temper the near-term bearish outlook.

Market Commentary

2009-03-30T06:29:00.003+01:00

MARKET COMMENTARY ON 30TH MARCH 2009

GBP/USD closed lower on Friday and below the 10-day moving average crossing at 1.4380 signaling that a short- term top has been posted. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI are turning bearish signaling that sideways to lower prices are possible near-term. Closes below the 20-day moving average crossing at 1.4191 are needed to confirm that a short-term top has been posted. If June renews this month's rally, February's high crossing at 1.4940 is the next upside target. First resistance is Tuesday's high crossing at 1.4762. Second resistance is February's high crossing at 1.4940. First support is today's low crossing at 1.4280. Second support is the 20-day moving average crossing at 1.4191.

EUR/USD closed lower on Friday and below the 10-day moving average crossing at 1.3410 signaling that a short-term top has been posted. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI are overbought and are turning bearish signaling that sideways to lower prices are possible near-term. If June extends today's decline, the 20-day moving average crossing at 1.3055 is the next downside target. Closes below the 20-day moving average crossing at 1.3055 would confirm that a short-term top has been posted.

USD/CHF closed sharply lower on Friday and below the 10-day moving average crossing signaling that a short-term top has likely been posted. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI are overbought and are turning neutral hinting that a short-term top might be in or is near. Closes below the 20-day moving average crossing would confirm that a short-term top has been posted. If June renews this month's rally, the 62% retracement level of the December-March decline crossing is the next upside target.

USD/CAD closed lower on Friday due to profit taking as it consolidated some of this month's rally. The mid- range close sets the stage for a steady opening on Monday. Stochastics and the RSI are overbought and are turning neutral to bearish hinting that a short-term top might be in or is near. Closes below the 20-day moving average crossing are needed to confirm that a short-term top has been posted. If June extends this month's rally, the reaction high crossing is the next upside target.

USD/JPY closed higher on Friday due to short covering as it consolidates some of this week's decline. The mid- range close sets the stage for a steady opening on Monday. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near-term. If June extends this week's decline, the reaction low crossing is the next downside target. Closes above the reaction high crossing would temper the near-term bearish outlook.

Market Commentary

2009-03-27T05:09:00.001Z

MARKET COMMENTARY ON 27TH MARCH 2009

GBP/USD closed lower due to profit taking on Thursday as it consolidated some of this month's rally. The low- range close sets the stage for a steady to lower opening on Friday. Stochastics and the RSI are overbought and are turning neutral to bearish signaling that a short-term top might be in or is near. Closes below the 20-day moving average crossing at 1.4192 would confirm that a short-term top has been posted. If June extends this month's rally, February's high crossing at 1.4920 is the next upside target. First resistance is Tuesday's high crossing at 1.4778. Second resistance is February's high crossing at 1.4920. First support is the 10-day moving average crossing at 1.4364. Second support is the 20-day moving average crossing at 1.4192.

EUR/USD closed lower on Thursday and below the 50% retracement level of the December-March decline crossing at 1.3520. The low-range close sets the stage for a steady to lower opening on Friday. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. If June renews this month's rally, the 62% retracement level of the December-March decline crossing at 1.3753 is the next upside target. Closes below the 20- day moving average crossing at 1.3085 would confirm that a short-term top has been posted.

USD/CHF posted an inside day with a lower close on Thursday as it consolidates below the 50% retracement level of the December-March decline crossing. The low-range close sets the stage for a steady to lower opening on Friday. Stochastics and the RSI are overbought but remain bullish signaling that sideways to higher prices are possible near-term. If June renews this month's rally, the 62% retracement level of the December-March decline crossing is the next upside target. Closes below the 20-day moving average crossing would confirm that a short-term top has been posted.

USD/CAD posted an inside day with a higher close on Thursday as it extends this week's trading range. The mid-range close sets the stage for a steady opening on Friday. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. If June extends this month's rally, the reaction high crossing at is the next upside target. Closes below the 20-day moving average crossing would confirm that a short-term top has been posted.

USD/JPY closed lower on Thursday as it extends this week's decline. The low-range close sets the stage for a steady to lower opening on Friday. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near-term. Closes below last Tuesday's low crossing would confirm that a short-term top has been posted. If June renews this month's rally, the reaction high crossing at 100.20 is the next upside target.

Geithner Remarks on IMF Currency Roil Foreign-Exchange Market

2009-03-26T06:16:00.001Z

March 26 (Bloomberg) -- Treasury Secretary Timothy Geithner sent the dollar tumbling with comments about China’s ideas for overhauling the global monetary system, only to drive it back up by affirming that it should remain the world’s reserve currency. Geithner was asked at a Council on Foreign Relations event in New York yesterday about People’s Bank of China Governor Zhou Xiaochuan’s call for a new international reserve currency. He said while he had not read Zhou’s proposal, he understood it as a plan “designed to increase the use of the IMF’s special drawing rights. And we’re actually quite open to that.”

The dollar slid as much as 1.3 percent against the euro within 10 minutes of news accounts of Geithner’s remarks. It recouped much of the loss about 15 minutes later, when Geithner then predicted no change in the U.S. currency’s role. The dollar was down 0.22 percent at $1.3553 per euro as of 12:13 p.m. in Tokyo. The episode highlights investors’ sensitivity to any weakening role for the dollar as power shifts toward a wider group of developed and emerging nations, said James McCormick, Citigroup Inc.’s global head of foreign-exchange and local- markets strategy. It was “important” that China’s proposal came in the run-up to a Group of 20 summit next week, he added.

Share of Reserves

“The G-20 is gaining relative power versus the G-7 and we will feel that and see that for some time to come,” London- based McCormick said. One key focus for markets will be any change in sentiment toward the dollar, which makes up about two- thirds of world central banks’ foreign-exchange reserves, he said. Geithner will attend the summit of the G-20, which groups the largest developing and emerging countries, April 2 in London along with President Barack Obama. The smaller Group of Seven had since the 1970s been the main forum for leaders of nations with the biggest economies.

After the dollar slumped in the aftermath of Geithner’s first remarks, Roger Altman, who worked with Geithner as deputy Treasury secretary in the Clinton administration, asked him whether he wanted to “clarify” his comments. “I’d like to ask one final question, in effect on behalf of the market,” said Altman, founder of Evercore Partners Inc. “Let me ask the question this way. Do you see any change over the foreseeable future in the basic role of the dollar as the world’s key reserve currency?”

Strong Dollar

Geithner responded: “I think the dollar remains the world’s dominant reserve currency.” In an interview with CNBC broadcast after the event, the Treasury chief said that a “strong dollar” is in “America’s interest.” In his earlier answer, Geithner said increased use of SDRs should be “rather evolutionary, building on the current architecture, rather than moving us to global monetary union.” SDRs are a unit of account at the IMF used for member countries’ reserves with the fund.

Geithner’s remarks don’t indicate Geithner favors moving to a system with the SDR as a reserve currency, strategist Lee Hardman at Bank of Tokyo-Mitsubishi Ltd. wrote in a note. “That was the big concern amongst the confusion,” London- based Hardman said. “A move to an SDR-linked system away from the dollar would naturally lead to a reduction in the dollar’s share of global reserves.”

‘Confidence’ in U.S.

Geithner, a former Treasury undersecretary for international affairs and president of the Federal Reserve Bank of New York, which carries out U.S. interventions in currency markets, also said that “we will do what’s necessary to make sure we’re sustaining confidence in our financial markets.” Geithner and Fed Chairman Ben S. Bernanke both told lawmakers on March 24 that they expected the dollar to remain the most important global currency. Obama said at a news conference the same day that “the dollar is extraordinarily strong” because investors are confident in the ability of the U.S. to lead a worldwide recovery, and also rejected calls for a new global currency.

China is the largest foreign holder of U.S. Treasuries, and Premier Wen Jiabao earlier this month expressed concern about the value of its investment. Central bank governor Zhou this week advocated a “super-sovereign reserve currency” that’s disconnected from any individual nation. Zhou said, in an essay posted on the PBOC’s Web site, that the International Monetary Fund’s special drawing rights offer “light in the tunnel for the reform of the international monetary system.” He said the SDR has yet to be “put into full play due to limitations on its allocation and the scope of its uses.”

McCormick at Citigroup said it was a concern that Geithner said he hadn’t read Zhou’s comments. “If I’m running the Treasury I would want to have been briefed on that.” Geithner has been the only confirmed senior official at the Treasury since he took office in January. The White House this week nominated former Clinton official Lael Brainard as Treasury undersecretary for international affairs after at least one other candidate for the job removed herself from contention.

Euro Rally May Wane as Options Drop From Record on Rate Concern

2009-03-26T06:11:00.000Z

March 26 (Bloomberg) -- Traders trimmed bets the euro will gain versus the dollar on speculation the European Central Bank will lower interest rates to bolster the region’s economies, options show. The euro’s one-month 25-delta risk-reversal rate against the dollar shows that premiums on euro call options over put options fell from record highs. The rate slid to as little as 0.55 percent yesterday, a one-week low, Bloomberg data show. It stood at 0.72 at 11:20 a.m. in Tokyo, from 1.17 on March 20, the most since Bloomberg started compiling the data in 2003.

“Risk-reversals have been skewed to euro bulls,” said Koji Fukaya, a senior currency strategist at the Tokyo unit of Deutsche Bank AG. “The European currency should naturally be sold after a sharp surge and may weaken in the long run,” as the pace of Europe’s economic recovery is likely to be slower than in the U.S., he said. The euro strengthened 7.4 percent against the dollar since Feb. 28, heading for its first monthly gain this year, after the U.S. central bank started buying Treasuries, raising concerns that will debase the value of the greenback. A call option gives its holder the right without obligation to buy an underlying asset while a put option gives the holder the right to sell an asset. Risk reversals measure demand for calls and puts.

‘Put Over’ Reverses

The euro-dollar risk-reversal stayed so-called “put over” for most of the first two months of the year, where demand for euro puts exceeds that for calls, indicating traders expect the 16-nation currency to weaken. The trend reversed in the middle of this month as concerns intensified that the Federal Reserve’s efforts to lower interest rates would revive inflation. As much as 10 billion euros ($13.6 billion) worth of euro put-dollar call options were bought on March 24 with a strike price of $1.30 per euro set to expire in a month, according to Takashi Kudo, director of foreign-exchange sales in Tokyo at NTT SmartTrade Inc., a unit of Nippon Telegraph & Telephone Corp.

The euro weakened as much as 1.5 percent against the dollar on that day, the biggest decline since Feb. 17. Implied volatility, a measure of expectations for future currency moves, on one-month euro-dollar options rose to about a month-high at 18.76 percent early this week and stood at 17.93 percent today in Tokyo. The euro traded at $1.3587 in Tokyo from $1.3583 late in New York yesterday. The 16-nation currency has fallen 2.6 percent against the dollar since Dec. 31, heading for its fourth quarterly decline, the longest streak of losses in three years.

Market Commentary

2009-03-26T05:22:00.001Z

MARKET COMMENTARY ON 26TH MARCH 2009

GBP/USD closed lower due to profit taking on Wednesday as it consolidated some of this month's rally. The low- range close sets the stage for a steady to lower opening on Thursday. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. If June extends this month's rally, February's high crossing at 1.4910 is the next upside target. Closes below the 20-day moving average crossing at 1.4185 would confirm that a short-term top has been posted. First resistance is Tuesday's high crossing at 1.4778. Second resistance is February's high crossing at 1.4910. First support is the 10-day moving average crossing at 1.4322. Second support is the 20-day moving average crossing at 1.4185.

EUR/USD closed higher on Wednesday and above the 50% retracement level of the December-March decline crossing at 1.3525. The mid-range close sets the stage for a steady opening on Thursday. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. If June extends this month's rally, the 62% retracement level of the December-March decline crossing at 1.3758 is the next upside target. Closes below the 20-day moving average crossing at 1.3025 would confirm that a short-term top has been posted.

USD/CHF closed higher on Wednesday but remains below the 50% retracement level of the December-March decline crossing. The high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are overbought but remain bullish signaling that sideways to higher prices are possible near-term. If June extends this week's rally, the 62% retracement level of the December-March decline crossing is the next upside target. Closes below the 20-day moving average crossing would confirm that a short-term top has been posted.

USD/CAD closed lower due to profit taking on Wednesday as it consolidated some of this month's rally. The low-range close sets the stage for a steady to lower opening on Thursday. Stochastics and the RSI are overbought but remain bullish signaling that sideways to higher prices are possible near-term. If June extends this month's rally, the reaction high crossing is the next upside target. Closes below the 20-day moving average crossing would confirm that a short-term top has been posted.

USD/JPY closed higher due to short covering on Wednesday as it consolidates some of Monday's decline. The high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI have turned bearish signaling that sideways to lower prices are possible near-term. Closes below last Tuesday's low crossing would confirm that a short-term top has been posted. If June renews this month's rally, the reaction high crossing at 100.55 is the next upside target.

3-Month Dollar Interbank Rates Edge Up; Euro Steady

2009-03-25T06:26:00.004Z

LONDON, March 25 (Reuters) - Interbank lending rates for three-month dollar funds were indicated slightly higher on Wednesday compared with the previous session as financial markets continued to reassess the likely success of the U.S. Government's plan to clean up banks' balance sheets. The two-year U.S. dollar interest rate swap spread over comparable Treasury yields -- a closely watched gauge of investor risk aversion -- narrowed to 54 basis points from 58 basis points early Tuesday, as the two-year yields held firm a day after the sale of $40 billion of two-year notes. Three-month dollar deposit rates were indicated between 1.24 and 1.55 percent compared with 1.16 and 1.53 percent early in London on Monday. Three-month euro deposit rates were indicated in a 1.39 to 1.56 percent range versus 1.35 to 1.56 percent, while three-month sterling was in a wider 1.17-1.51 percent range compared with 1.44-1.50 percent. Interbank deposit rates are only indicative prices of where banks are lending to each other, which institutions use as a base to set their own lending rates.

Market Commentary

2009-03-25T05:05:00.002Z

MARKET COMMENTARY ON 25TH MARCH 2009

GBP/USD closed higher on Tuesday extending this month's rally. The high-range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term. If June extends this month's rally, February's high crossing at 1.4930 is the next upside target. Closes below the 20- day moving average crossing at 1.4200 would confirm that a short-term top has been posted. First resistance is today's high crossing at 1.4752. Second resistance is February's high crossing at 1.4910. First support is the 10-day moving average crossing at 1.4245. Second support is the 20-day moving average crossing at 1.4168.

EUR/USD closed lower on Tuesday and below the 50% retracement level of the December-March decline crossing at 1.3520. The low-range close sets the stage for a steady to lower opening on Wednesday. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. If June extends this month's rally, the 62% retracement level of the December-March decline crossing at 1.3770 is the next upside target. Closes below the 20-day moving average crossing at 1.2948 would temper the near-term friendly outlook in the market.

USD/CHF posted an inside day with a lower close on Tuesday as it consolidates below the 50% retracement level of the December-March decline crossing. The mid-range close sets the stage for a steady opening on Wednesday. Stochastics and the RSI are becoming overbought but remain bullish signaling that sideways to higher prices are possible near- term. If June extends this week's rally, the 62% retracement level of the December-March decline crossing is the next upside target. Closes below the 20-day moving average crossing would confirm that a short-term top has been posted.

USD/CAD closed higher on Tuesday as it extended this month's rally. The mid-range close sets the stage for a steady opening on Wednesday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term. If June extends this month's rally, the reaction high crossing is the next upside target. Closes below the 20- day moving average crossing would confirm that a short-term top has been posted.

USD/JPY closed lower on Tuesday and below the 20-day moving average. The mid-range close sets the stage for a steady opening on Wednesday. Stochastics and the RSI are turning bearish signaling that sideways to lower prices are possible near-term. Closes below last Tuesday's low crossing would confirm that a short-term top has been posted. If June renews this month's rally, the reaction high crossing at 100.20 is the next upside target.

FOREX-Dollar, yen slide as US bank plan blurs haven allure

2009-03-24T06:17:00.001Z

NEW YORK, March 23 (Reuters) - The dollar and yen fell on Monday as investors reduced safe-haven bids on both currencies after the U.S. government unveiled a plan to unlock toxic assets from banks' balance sheets in an effort to pull the economy out of recession.

Higher-yielding currencies such as the Australian and New Zealand dollars, meanwhile, gained sharply, along with soaring U.S. stocks, as Treasury Secretary Timothy Geithner outlined details of the bank rescue plan. "This is more about risk appetite with U.S. stocks up after the Geithner announcement," said Brian Kim, currency strategist at UBS in Stamford, Connecticut. "So we're seeing the euro rally against the dollar on this, along with the aussie and the kiwi" dollars.

In late afternoon trading, the euro rose 0.5 percent against the dollar to $1.3648 after trading as low as $1.3487, according to Reuters data. Earlier, the euro had risen as high as $1.3735 after European Central Bank chief Jean-Claude Trichet signaled in a newspaper interview published on Monday that the ECB remained wary of interest rates falling to zero.

That should enhance the attractiveness of euro zone instruments over those in the United States and Japan, where interest rates are already near zero. The yen, on the other hand, came under heavy selling pressure, falling to a five-month low against the euro. The single euro zone currency jumped on electronic trading platform EBS to 132.56 yen , the highest since October 2008. The euro last traded at 132.45 up 1.7 percent. Against the yen, the dollar rose 1.2 percent to 97 yen .

The low-yielding dollar and yen are viewed as safe-haven currencies with minimal volatility. When stocks plunge and the risk barometer shoots up, investors repatriate funds, closing out losing trades that were financed by low rates in both the dollar and yen. Sterling firmed, rising 0.8 percent against the dollar to $1.4574 , despite the Bank of England's recent move toward quantitative easing as the UK currency benefited from a jump in equities following the Geithner news.

Sterling also hit a 3-1/2-month-high at 141.85 yen , while the Australian dollar rose to 68.37 yen, its highest since November 2008. While the Geithner announcement was a short-term negative for the safe-haven dollar, some analysts believe the bank bailout plan would be not be as detrimental for the greenback in the long term as many market watchers had initially surmised.

Market Commentary

2009-03-24T05:16:00.003Z

MARKET COMMENTARY ON 24TH MARCH 2009

GBP/USD closed higher on Monday extending this month's rally. Profit taking tempered early gains and the mid- range close sets the stage for a steady opening on Tuesday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term. If June extends this month's rally, February's high crossing at 1.4940 is the next upside target. Closes below last Wednesday's low crossing at 1.3870 would confirm that a short-term top has been posted. First resistance is today's high crossing at 1.4635. Second resistance is February's high crossing at 1.4925. First support is the 20- day moving average crossing at 1.4156. Second support is last Wednesday's low crossing at 1.3870.

EUR/USD closed higher on Monday as it consolidates above the 50% retracement level of the December-March decline crossing. The mid-range close sets the stage for a steady opening on Tuesday. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. If June extends this month's rally, the 62% retracement level of the December-March decline crossing at 1.3745 is the next upside target. Closes below the 20-day moving average crossing at 1.3140 would temper the near-term friendly outlook in the market.

USD/CHF closed higher on Monday but remains below the 50% retracement level of the December-March decline crossing. The mid-range close sets the stage for a steady opening on Tuesday. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. If June extends this week's rally, the 62% retracement level of the December-March decline crossing is the next upside target. Closes below the 20-day moving average crossing would confirm that a short-term top has been posted.

USD/CAD closed higher on Monday as it extended this month's rally. The high-range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term. If June extends this month's rally, the reaction high crossing is the next upside target. Closes below the 20-day moving average crossing would confirm that a short-term top has been posted.

USD/JPY closed lower on Monday as it consolidated some of last Thursday's rally. The low-range close sets the stage for a steady to lower opening on Tuesday. Stochastics and the RSI are turning neutral hinting that a short-term top might be in or is near. Closes below last Tuesday's low crossing would confirm that a short-term top has been posted. If June extends this month's rally, the reaction high crossing is the next upside target.

Yen falls as investors opt for higher-yielders

2009-03-23T06:24:00.002Z

TOKYO (Reuters) - The yen fell to its lowest in five months against the euro on Monday and dropped more than 1 percent against higher-yielding currencies as investors grew bolder on U.S. plans to tackle financial system problems.

Stock markets around Asia rose in anticipation of plans by Treasury Secretary Timothy Geithner to purge U.S. banks of "toxic" assets, leaving the yen, which had been a gainer last year in times of financial stress, at the mercy of the Australian and New Zealand dollars.

Geithner is set to speak at 1245 GMT but a U.S. official gave details of the plan beforehand, saying the government would put in $75 billion to $100 billion from its bailout fund to partner with private investors and buy troubled assets at the heart of the financial crisis.

"It's naturally positive news for the financial markets. The scheme is necessary for the market, and the size of the reported toxic assets to be bought seems large," said Jun Kato, deputy general manager of the treasury business group at Shinkin Central Bank.

Traders and analysts said that as well as improved risk appetite investors were favouring currencies whose central banks had interest rates above zero and looked unlikely to deploy forms of quantitative easing to get their economies moving.

An announcement by the Federal Reserve last week that it would buy up to $300 billion in longer-term government debt sent the dollar into a tailspin as investors fretted it would flood the market with dollars.

The euro rose 1.1 percent to 131.41 yen. Earlier, it hit its highest since late October at 131.97 yen on trading platform ut for the time being, markets seem reassured and risk aversion may ease, said Akira Kato, senior manager for Bank of Tokyo-Mitsubishi UFJ's foreign exchange trading department.

"During the week, there will probably be more unwinding of risk-aversion type positions," Kato said, adding that the euro could rise toward 134 yen later this week.

Market Commentary

2009-03-23T05:09:00.005Z

MARKET COMMENTARY ON 23rd MARCH 2009

GBP/USD posted an inside day with a lower close on Friday as it consolidated some of this week's rally. The low- range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term. If June extends this week's rally, the reaction high crossing at 1.4630 is the next upside target. Closes below Wednesday's low crossing at 1.3870 would confirm that a short-term top has been posted.

EUR/USD posted an inside day with a lower close on Friday due to profit taking as it consolidated some of this week's rally. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near-term. If June extends this month's rally, the 62% retracement level of the December-March decline crossing at 1.3775 is the next upside target. Closes below the 20-day moving average crossing at 1.2890 would temper the near-term friendly outlook in the market.

USD/CHF posted an inside day with a lower close on Friday as it consolidates below the 50% retracement level of the December-March decline crossing. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. If June extends this week's rally, the 62% retracement level of the December-March decline crossing is the next upside target. Closes below the 20-day moving average crossing would temper the near-term friendly outlook in the market.

USD/CAD posted an inside day with a lower close on Friday as it consolidated some of this week's rally. A short covering rally tempered early losses and the mid-range close sets the stage for a steady opening on Monday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term. If June extends this week's rally, the reaction high crossing is the next upside target. Closes below the 10-day moving average crossing would confirm that a short-term top has been posted.

USD/JPY posted an inside day with a lower close on Friday as it consolidated some of Thursday's rally. The low- range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term. If June extends this week's rally, the reaction high crossing is the next upside target. Closes below Tuesday's low crossing would confirm that a short-term top has been posted.

Market Commentary

2009-03-20T07:01:00.001Z

MARKET COMMENTARY ON 20TH MARCH 2009

GBP USD closed sharply higher for the second day in a row on Thursday as it extends this week's rally. The high-range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI remain bullish signalling that sideways to higher prices are possible near-term. If it extends this week's rally, the reaction high crossing is the next upside target. Closes below Wednesday's low crossing would confirm that a short-term top has been posted.

EUR/USD closed sharply higher for the second day in a row on Wednesday as it extends this month's rally. The high-range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are overbought but remain bullish signalling that sideways to higher prices are possible near-term. If it extends this month's rally, the 62% retracement level of the December-March decline crossing is the next upside target. Closes below the 20-day moving average crossing would temper the near-term friendly outlook in the market.

USD/CHF closed sharply higher and tested the 50% retracement level of the December-March decline crossing. The high-range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are turning bullish signalling that sideways to higher prices are possible near-term. If it extends this week's rally, the 62% retracement level of the December-March decline crossing is the next upside target. Closes below the 20-day moving average crossing would temper the near-term friendly outlook in the market.

USD/CAD closed lower on Thursday. The low-range close sets the stage for a steady to lower opening on Friday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term. If June extends this week's rally, the reaction high crossing at is the next upside target. Closes below the 10-day moving average crossing would confirm that a short-term top has been posted.

USD/JPY closed sharply higher for the second day in a row on Thursday and above the reaction high crossing confirming that a short-term low has been posted. The high-range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are bullish signalling that sideways to higher prices are possible near-term. If it extends this week's rally, the reaction high crossing is the next upside target. Closes below Tuesday's low crossing would confirm that a short-term top has been posted.

Euro, British Pound Consolidate Gains After Dovish FOMC Sparks Rally (Euro Open)

2009-03-19T06:41:00.004Z

Euro, British Pound Consolidate Gains After Dovish FOMC Sparks Rally (Euro Open)
2009-03-19 05:19 (UTC)

The Euro and the British Pound consolidated in narrow ranges in overnight trading after an unexpectedly dovish statement from the US Federal Reserve triggered a US Dollar selloff, pushing EURUSD and GBPUSD sharply higher. Switzerland’s Trade Balance and ZEW survey of investor confidence are on tap in European hours.

Key Overnight Developments

• Australian Annual Car Sales Lowest in 7 Years

• Japan May Inject Capital into Failing Companies, Says LDP Chief

• Euro, British Pound Consolidate After FOMC Sparks Rally

Market Commentary

2009-03-19T05:17:00.004Z

MARKET COMMENTARY ON 19TH MARCH 2009

GBP/USD closed higher on Wednesday and above the 20-day moving average crossing at 1.4139 confirming that a short-term low has been posted. The high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term. If June extends this week's rally, the reaction high crossing at 1.4620 is the next upside target. Closes below today's low crossing at 1.3875 would confirm that a short-term top has been posted.

EUR/USD closed sharply higher on Wednesday as it extends this month's rally. The high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. If June extends this month's rally, the 50% retracement level of the December-March decline crossing is the next upside target. Closes below the 20-day moving average crossing would temper the near-term friendly outlook in the market.

USD/CHF closed sharply higher on Wednesday and above last week's high crossing confirming that a low has been posted. The high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are turning neutral to bullish signaling that sideways to higher prices are possible near-term. If June extends this week's rally, the 50% retracement level of the December-March decline crossing is the next upside target. Closes below the 10-day moving average crossing would temper the near-term friendly outlook in the market.

USD/CAD closed sharply higher on Wednesday as it extends Monday's breakout above the 20-day moving average crossing. The high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term. If June extends this week's rally, the reaction high crossing is the next upside target. Closes below the 10-day moving average crossing would confirm that a short-term top has been posted.

USD/JPY closed sharply higher on Wednesday and above the 20-day moving average crossing. The high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. Closes above the reaction high crossing are needed to confirm that a short-term low has been posted. Closes below the reaction low crossing would renew this year's decline.

Yen Trades Near 2009 Low Against Euro as BOJ Raises Debt Buying

2009-03-18T07:43:00.000Z

March 18 (Bloomberg) -- The Yen traded near the weakest level against the Euro this year after the Bank of Japan said it will step up purchases of government debt, encouraging investors to seek higher-yielding assets overseas.

The dollar was near a one-month low against the euro as Asian stocks extended a rally in global equities, damping demand for the U.S. currency as a refuge from the financial turmoil. South Korea’s won had the biggest decline against the dollar of the 16 most-traded currencies on speculation domestic companies took advantage of its recent gains to pay import bills.

“Governments and central banks are taking various measures which are supporting sentiment that the worst of the financial crisis may be over,” said Yuji Saito, Tokyo-based head of the foreign-exchange group at Societe Generale SA, France’s third- largest bank. “People who had shunned risk are returning to the markets. This is causing selling of the dollar and the yen.”

Japan’s currency traded at 128.17 against the euro as of 7:49 a.m. in London, from 128.35 yesterday in New York, when it slid 0.8 percent. It earlier dropped to 128.83, the weakest since Dec. 29. The yen was at 98.58 per dollar from 98.60.

The dollar was at $1.3001 per euro from $1.3017 yesterday, when it declined 0.4 percent. The U.S. currency touched $1.3072 on March 16, the lowest level since Feb. 10.

Market Commentary

2009-03-18T05:10:00.003Z

MARKET COMMENTARY ON 18TH MARCH 2009

GBP/USD posted an inside day with a lower close on Tuesday but remains above the 10-day moving average crossing at 1.3970. The mid-range close sets the stage for a steady opening on Wednesday. Stochastics and the RSI are bullish hinting that a short-term low might be in or is near. Closes above the 20-day moving average crossing at 1.4140 are needed to confirm that a bottom has been posted. If June renews last week's decline, January's low crossing at 1.3630 is the next downside target.

EUR/USD closed higher on Monday as it extends this month's rally. The high-range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near- term. If June extends this month's rally, the 38% retracement level of the December-March decline crossing at 1.3260 is the next upside target. Closes below the 20-day moving average crossing at 1.2750 would temper the near-term friendly outlook in the market.

USD/CHF closed higher on Tuesday due to short covering as it consolidated some of last Thursday's decline. The high-range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near-term. Closes above the 20-day moving average crossing would temper the near-term friendly outlook in the market. Closes above the reaction high crossing are needed to renew the rally off February's low.

USD/CAD closed lower on Tuesday due to profit taking but remains above the 20-day moving average crossing. The high-range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. Multiple closes above the 20-day moving average crossing are needed to confirm that a short-term low has been posted. If June renews this year's decline, weekly support crossing is the next downside target.

USD/JPY closed lower on Tuesday but remains above the 62% retracement level of the August-January rally crossing. The mid-range close sets the stage for a steady opening on Wednesday. Stochastics and the RSI are bullish hinting that a short-term low might be in or is near. Closes above the reaction high crossing are needed to confirm that a short-term low has been posted. If June renews this year's decline, the 75% retracement level of the August-January rally crossing is the next downside target.

Market Commentary

2009-03-17T05:21:00.004Z

MARKET COMMENTARY ON 17TH MARCH 2009

GBP/USD closed higher due to short covering on Monday and above the 10-day moving average crossing signaling that a short-term low has been posted. The mid-range close sets the stage for a steady opening on Tuesday. Stochastics and the RSI are turning bullish hinting that a short-term low might be in or is near. Closes above the 20-day moving average crossing are needed to confirm that a bottom has been posted. If June renews last week's decline, January's low crossing is the next downside target.

EUR/USD closed higher on Monday as it extends last week's breakout above the 20-day moving average. The mid-range close sets the stage for a steady opening on Tuesday. Stochastics and the RSI are bullish signaling that a low might be in or is near. If June extends this month's rally, the 38% retracement level of the December-March decline crossing is the next upside target. Closes below the 20-day moving average crossing would temper the near-term friendly outlook in the market.

USD/CHF closed higher on Monday due to short covering as it consolidated some of last Thursday's decline. The mid-range close sets the stage for a steady opening on Tuesday. Stochastics and the RSI remain bearish signaling that sideways to lower prices are possible near-term. If June extends last week's decline, October's low crossing is the next downside target. Closes above the reaction high crossing are needed to renew the rally off February's low.

USD/CAD closed higher on Monday and above the 20-day moving average crossing. The high-range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. Multiple closes above the 20-day moving average crossing are needed to confirm that a short-term low has been posted. If June renews this year's decline, weekly support crossing is the next downside target.

USD/JPY closed lower on Monday but remains above the 62% retracement level of the August-January rally crossing. The mid-range close sets the stage for a steady opening on Tuesday. Stochastics and the RSI are turning bullish hinting that a short-term low might be in or is near. Closes above the reaction high crossing are needed to confirm that a short-term low has been posted. If June renews this year's decline, the 75% retracement level of the August- January rally crossing is the next downside target.

Australia, N.Z. Dollars Fall From Month Highs on Rates Concern

2009-03-16T06:07:00.000Z

March 16 (Bloomberg) -- The Australian and New Zealand dollars fell, retreating from one-month highs touched late last week, amid concerns the nations’ deteriorating economies may spur their central banks to lower interest rates to records.

New Zealand’s manufacturing sales excluding inflation fell 5.4 percent in the fourth quarter, the statistics department said. The Reserve Bank of Australia tomorrow releases minutes of the March 3 board meeting, where policy makers halted reductions in borrowing costs. Since that meeting, government reports showed gross domestic product shrank for the first time in eight years and the unemployment rate climbed to a four-year high.

“The RBA’s minutes moved markets on quite a few occasions so traders are a bit uneasy ahead of that, especially as the meeting was prior to the weak GDP and jobs data,” said Sean Callow, a senior currency strategist in Sydney at Westpac Banking Corp., Australia’s biggest lender by market value. “New Zealand’s manufacturing sales today also puts downside risks to GDP forecasts for” the Reserve Bank of New Zealand.

Australia’s currency fell 0.3 percent to 65.62 U.S. cents as of 4:21 p.m. in Sydney from 65.82 cents in New York late last week, when it touched 66.04 cents, the strongest since Feb. 13. The currency was unchanged at 64.47 yen.

Rate Cut Chances

The Aussie, as the currency is often known, will trade between 65.15 to 66.20 cents to the U.S. dollar today, Callow said, adding that markets are pricing in an 80 percent chance the RBA will lower rates next month by 0.5 percentage point to 2.75 percent and a 20 percent chance for a reduction to 3 percent.

New Zealand’s dollar weakened 0.2 percent to 52.39 U.S. cents from 52.49 cents in New York on March 13, when it peaked at 52.69 cents, also the highest since Feb. 13. It was unchanged at 51.46 yen.

The kiwi, as the currency is commonly called, is likely to trade between 51.40 to 53.00 cents to the dollar today, Westpac’s Callow said.

Australian policy makers on March 3 left the benchmark interest rate unchanged for the first time in seven months, saying the lowest borrowing costs in four decades and government spending were supporting the economy.

Australian Dollar Shorts

“It’s come off a little before the RBA minutes as that will give indications on their thinking and that may add to speculation of a rate cut as early as next month,” said Besa Deda, chief economist at St. George Bank Ltd. in Sydney, said about the Australian currency.

Futures traders increased their bets that the Australian dollar will decline against the U.S. dollar, figures from the Washington-based Commodity Futures Trading Commission show. The difference in the number of wagers by hedge funds and other large speculators on a fall in the Australian dollar compared with those on a gain -- so-called net shorts -- was 3,945 on March 10, compared with net shorts of 2,786 a week earlier.

Futures are agreements to buy or sell assets at a set price and date. The figures reflect holdings in currency-futures contracts at the Chicago Mercantile Exchange as of Tuesday.

The euro fell versus the dollar, ending four days of gains, on speculation European nations will fail to increase spending enough to counter the financial turmoil in the region, spurring concerns of renewed risk aversion. The 16-nation currency declined against 11 of the 16 major currencies after European officials at the weekend Group of 20 finance ministers meeting said they had spent sufficient money to combat the financial crisis and didn’t want to blow out their budgets.

Market Commentary

2009-03-16T05:16:00.005Z

MARKET COMMENTARY ON 16TH MARCH 2009

GBP/USD closed higher due to short covering on Friday as it consolidated some of this week's decline. The mid- range close sets the stage for a steady opening on Monday. Stochastics and the RSI are oversold and are turning bullish hinting that a short-term low might be in or is near. Closes above the 20-day moving average crossing are needed to confirm that a bottom has been posted. If June renews this week's decline, January's low crossing at 1.3620 is the next downside target.

EUR/USD closed higher on Friday as it extends this week's breakout above the 20-day moving average. The mid-range close sets the stage for a steady opening on Monday. Stochastics and the RSI are bullish signaling that a low might be in or is near. Closes above the reaction high crossing are needed to confirm that a short-term low has been posted. Closes below the 10-day moving average crossing would temper the near-term friendly outlook in the market.

USD/CHF posted an inside day with a higher close on Friday as it consolidated some of Thursday's decline. The mid-range close sets the stage for a steady opening on Monday. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near-term. If June extends this week's decline, October's low crossing is the next downside target. Closes above the reaction high crossing are needed to renew the rally off February's low.

USD/CAD closed higher due to short covering on Friday as it extends the rebound off this week's low. Profit taking tempered early gains and the mid-range close sets the stage for a steady opening on Monday. Stochastics and the RSI have turned bullish hinting that a short-term low might be in or is near. Closes above the 20-day moving average crossing are needed to confirm that a short-term low has been posted.

USD/JPY closed slightly lower on Friday but remains above the 62% retracement level of the August-January rally crossing. The mid-range close sets the stage for a steady opening on Monday. Stochastics and the RSI are turning bullish hinting that a short-term low might be in or is near. Closes above Thursday's high crossing are needed to confirm that a short-term low has been posted. If June renews this year's decline, the 75% retracement level of the August- January rally crossing is the next downside target.

Market Commentary

2009-03-13T05:16:00.004Z

MARKET COMMENTARY ON 13TH MARCH 2009

GBP/USD closed higher due to short covering on Thursday as it consolidated some of this week's decline. The high-range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are neutral to bearish signaling that sideways to lower prices are possible near-term. If June renews this week's decline, January's low crossing is the next downside target. Closes above the 20-day moving average crossing are needed to confirm that a bottom has been posted.

EUR/USD closed higher on Thursday as it extends yesterday's breakout above the 20-day moving average crossing. The high-range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are bullish signaling that a low might be in or is near. Closes above the reaction high crossing are needed to confirm that a short-term low has been posted. If June renews this year's decline, October's low crossing is the next downside target.

USD/CHF closed sharply lower on Thursday and spiked below February's low crossing. The low-range close sets the stage for a steady to lower opening on Friday. Stochastics and the RSI are turning bearish signaling that sideways to lower prices are possible near-term. Closes above the reaction high crossing are needed to renew the rally off February's low.

USD/CAD closed higher due to short covering on Thursday as it consolidates above December's low crossing. The high-range close sets the stage for a steady to higher opening on Friday. Stochastics and the RSI are turning bullish hinting that a short-term low might be in or is near. If June extends this year's decline, weekly support crossing is the next downside target. Closes above the 20-day moving average crossing are needed to confirm that a short-term low has been posted.

USD/JPY closed lower on Wednesday but remains above the 62% retracement level of the August-January rally crossing. The low-range close sets the stage for a steady to lower opening on Friday. Stochastics and the RSI are turning bullish hinting that a short-term low might be in or is near. Closes above the 20-day moving average crossing are needed to confirm that a short-term low has been posted. If June extends this year's decline, the 75% retracement level of the August-January rally crossing is the next downside target.

Yen Rises as Deepening Global Recession Spurs Demand for Refuge

2009-03-12T06:43:00.002Z

March 12 (Bloomberg) -- The yen advanced for a second day against the euro on speculation the deepening global recession will increase demand for the currency as a refuge.
The yen and the greenback both gained versus the Australian and New Zealand dollars after a Japanese report confirmed the world’s second biggest economy shrank last quarter at the fastest pace since 1974, prompting investors to sell higher- yielding assets. The euro may halt a two-day winning streak against the dollar before a German report that economists say will show industrial production dropped for a fifth month, giving the European Central Bank more room to cut interest rates.
“The Japanese report was certainly bad, with some of the data suggesting the economy will keep deteriorating this quarter,” said Yuji Saito, head of the currency group in Tokyo at Societe Generale SA, France’s third-largest bank. “Investors are still risk-averse. This has led to buying of the yen.”
The yen climbed to 123.43 versus the euro as of 6:41 a.m. in London from 124.86 late yesterday in New York. The currency advanced to 96.40 per dollar 97.27. It earlier reached 95.96, the strongest level since Feb. 24.
Japan’s currency gained 2 percent to 62.20 against the Australian dollar and rose 1.3 percent to 49.30 versus the New Zealand dollar. The dollar traded at $1.2803 per euro from $1.2837 late yesterday.

http://www.bloomberg.com/apps/news?pid=20601083&sid=a.OHgzTSGdjU&refer=currency

Market Commentary

2009-03-12T05:14:00.005Z

MARKET COMMENTARY ON 12TH MARCH 2009

GBP/USD closed higher due to short covering on Wednesday as it consolidated some of this week's decline. The high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are neutral to bearish signaling that sideways to lower prices are possible near-term. If June extends this week's decline, January's low crossing is the next downside target. Closes above the 20-day moving average crossing are needed to confirm that a bottom has been posted.

EUR/USD closed higher on Wednesday. The high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are bullish signaling that a low might be in or is near. Closes above the reaction high crossing are needed to confirm that a short-term low has been posted. If June renews this year's decline, October's low crossing is the next downside target.

USD/CHF closed higher on Wednesday and extended last Friday's rally above the 20-day moving average crossing. The high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are neutral to bullish signaling that sideways to higher prices are possible near-term. Closes above the reaction high crossing are needed to renew the rally off February's low. Closes below February's low crossing are needed to renew this year's decline.

USD/CAD closed higher due to short covering on Wednesday as it consolidates above December's low crossing. The mid-range close sets the stage for a steady opening on Thursday. Stochastics and the RSI are oversold but are neutral to bearish signaling that sideways to lower prices are possible near-term. If June extends this year's decline, weekly support crossing is the next downside target. Closes above the 20-day moving average crossing are needed to confirm that a short-term low has been posted.

USD/JPY closed higher on Wednesday as it consolidates above the retracement level of the August-January rally crossing. The high-range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are turning bullish hinting that a short-term low might be in or is near. Closes above the 20-day moving average crossing are needed to confirm that a short-term low has been posted. If June extends this year's decline, the 75% retracement level of the August-January rally crossing is the next downside target.

Market Commentary

2009-03-11T06:08:00.006Z

MARKET COMMENTARY ON 11TH MARCH 2009

GBP/USD closed lower on Tuesday as it extended the decline off February's high. The low-range close sets the stage for a steady to lower opening on Wednesday. Stochastics and the RSI are neutral to bearish signaling that sideways to lower prices are possible near-term. If March extends this week's decline, January's low crossing is the next downside target. Closes above the 20-day moving average crossing are needed to confirm that a bottom has been posted.

EUR/USD closed slightly higher on Tuesday but remains below the 20-day moving average crossing. The low- range close sets the stage for a steady to lower opening on Wednesday. Stochastics and the RSI have turned bullish signaling that a low might be in or is near. Closes above the reaction high crossing are needed to confirm that a short-term low has been posted. If March renews this year's decline, November's low crossing is the next downside target.

USD/CHF closed higher on Tuesday as it consolidated some of last Friday's rally but remains below the 20-day moving average crossing. The low-range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near-term. Closes below the reaction low crossing are needed to renew the rally off February's high.

USD/CAD closed lower due to short covering on Tuesday as it consolidates below December's low crossing. The mid-range close sets the stage for a steady opening on Wednesday. Stochastics and the RSI are oversold but are neutral to bullish signaling that sideways to higher prices are possible near-term. Closes below the 20-day moving average crossing are needed to confirm that a long-term high has been posted.

USD/JPY closed slightly lower on Tuesday as it consolidates above the retracement level of the August- January rally crossing. The low-range close sets the stage for a steady to lower opening on Wednesday. Stochastics and the RSI are oversold but are neutral to bullish hinting that a short-term low might be in or is near. Closes below the 20-day moving average crossing are needed to confirm that a short-term high has been posted.

Yen, Dollar Weaken as Stock Gains Boost Higher-Yield Currencies

2009-03-10T08:55:00.003Z

March 10 (Bloomberg) -- The yen and the dollar weakened on speculation gains in Asian stocks and U.S. equity futures fueled demand for higher-yielding assets.
The euro approached a two-month high against Japan’s currency on expectations European investors will bring home overseas earnings before the end of the first quarter. South Korea’s won gained the most in almost two months against the dollar as overseas investors bought more of the nation’s shares than they sold. The Australian and New Zealand dollars advanced as Asian stocks rose.

“We’ve got a lot of green on the board in Asian equities and that’s good for risk-taking appetite,” said Sean Callow, a senior currency strategist at Westpac Banking Corp., Australia’s biggest lender by market value. “It would certainly fit into the yen weakness that’s been one of the biggest stories over the past month. That also works to the detriment of the dollar.”
The yen dropped to 125.42 versus the euro as of 7:51 a.m. in London from 124.65 late in New York yesterday. The dollar dropped to $1.2706 per euro from $1.2611. The U.S. currency declined to 98.69 yen from 98.84 yen.

Japan’s currency fell 1 percent to 63.04 versus the Australian dollar, and weakened 0.7 percent to 49.06 against the New Zealand dollar from late in New York yesterday.
The yen slid against 14 of the 16 most actively traded currencies after a Cabinet Office report today showed the leading index of business conditions fell to 77.1 in January from 80 in December, below the consensus forecast of 77.4 in a Bloomberg News survey. The coincident index, which shows current economic activity, dropped to 89.6 from 92.4.

http://www.bloomberg.com/apps/news?pid=20601083&sid=a300.7j5MLKo&refer=currency

Market Commentary

2009-03-10T06:02:00.001Z

MARKET COMMENTARY on 10th March 2009

GBP/USD closed lower on Monday thereby renewing the decline off February's high. The low-range close sets the stage for a steady to lower opening on Tuesday. Stochastics and the RSI are neutral signaling that sideways to lower prices are possible near-term. If March extends this week's decline, January's low crossing is the next downside target.

EUR/USD posted an inside day with a lower close on Monday as it consolidated some of last Friday's rally. The mid- range close sets the stage for a steady opening on Tuesday. Stochastics and the RSI are turning bullish signaling that a low might be in or is near. Closes above the reaction high crossing are needed to confirm that a short-term low has been posted. If March renews this year's decline, November's low crossing is the next downside target.

USD/CHF Closed higher on Monday as it consolidated some of last Friday's rally but remains below the 20-day moving average crossing. The low-range close sets the stage for a steady to lower opening on Tuesday. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near-term. Closes below the reaction low crossing would renew the rally off February's high.

USD/CAD closed lower on Monday and spiked below December's low crossing. The mid-range close sets the stage for a steady opening on Tuesday. Stochastics and the RSI are oversold but are neutral to bearish signaling that sideways to lower prices are possible near-term. Closes above the 20-day moving average crossing are needed to confirm that a short-term low has been posted.

USD/YEN closed higher on Monday ending a two-day short covering bounce off the retracement level of the August-January rally crossing. The high-range close sets the stage for a steady to higher opening on Tuesday. Stochastics and the RSI are oversold but are turning neutral to bullish hinting that a short-term high might be in or is near. Closes below the 20-day moving average crossing are needed to confirm that a short-term high has been posted.

MARKET COMMENTARY

2009-03-09T06:46:00.001Z

MARKET COMMENTARY On 09th March'09

GBP/USD closed lower on Friday and the low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI are neutral signalling that sideways to lower prices are possible near-term. If it extends this week's decline, January's low crossing is the next downside target. Closes above the 20-day moving average crossing are needed to confirm that a bottom has been posted.

EUR/USD closed higher on Friday due to short covering. The high-range close sets the stage for a steady to higher opening on Monday. Stochastics and the RSI are diverging and turning bullish signalling that a low might be in or is near. Closes above last Monday's high crossing are needed to confirm that a short-term low has been posted. If it renews this year's decline, November's low crossing is the next downside target.

USD/JPY posted an inside day with a lower close on Friday. The low-range close sets the stage for a steady opening on Monday. Stochastics and the RSI remain neutral to bearish signalling that sideways to lower prices are possible near-term. If it renews this year's decline, November's low crossing is the next downside target. Closes above last Monday's high crossing are needed to confirm that a short-term low has been posted.

USD/CHF closed sharply higher on Friday and above the 20-day moving average crossing. The high- range close sets the stage for a steady to higher opening on Monday. Stochastics and the RSI are turning bullish signalling that sideways to higher prices are possible near-term. Closes above the reaction high crossing would renew the rally off February's low. Closes below February's low crossing are needed to renew this year's decline.

USD/CAD posted an inside day with a slightly higher close on Friday as it consolidated some of Thursday's decline. The low-range close sets the stage for a steady to lower opening on Monday. Stochastics and the RSI are oversold and are turning neutral hinting that a short-term low might be in or is near. Closes above the 20-day moving average crossing are needed to confirm that a short-term low has been posted.

Forex Online Trading

2009-03-09T06:00:00.001Z

"Forex" stands for foreign exchange; it's also known as FX. In a forex trade, you buy one currency while simultaneously selling another - that is, you're exchanging the sold currency for the one you're buying. The foreign exchange market is an over-the-counter market.

Foreign Exchange transactions typically involve one party purchasing a quantity of one currency in exchange for paying a quantity of another. It includes trading between large banks, central banks, currency speculators, corporations, governments, and other institutions. The average daily volume in the global forex and related markets is continuously growing. Since then the market has continued to grow. The foreign exchange or the forex market is accepted as the most active and liquid financial markets in the world.

The spot forex market is an over-the-counter market and is different from exchange-traded products because it has no physical location or central exchange. Foreign exchange trading takes place in the world major financial trading centers with the main centers being London, New York and Tokyo.

TEN Good Qualities Should A Forex Trader Have.

1) Learn Before You Leap

2) Cut Losses, Let Gain Run

3) Discipline is Crucial

4) Focus On The Process

5) Know Your Exit

6) Manage Your Money

7) The Trend Is Your Friend

8) Don’t Trade Emotions

9) Consider Who Loses

10) Remain Humble

SIX Guidelines for Forex Trading

Forex trading may become a much easier activity if you follow your own or someone else’s well-formulated guidelines. I’ve based my guidelines on my past Forex trading experience and knowledge gained listening to some of the best stock and Forex traders. What’s important is that the guidelines are not the laws and rules — they are not the only way to success, they just help the traders in their endeavor. Here’s the list of my Six Forex trading guidelines:

1) Open a Demo Account and learn to trade it first before “going live” with real money. You will usually learn how to avoid some mistakes and also get familiar with the broker’s trading platform before you have hard-earned money at risk.

2) If you’ve never traded Forex before, I recommend opening a mini account first. Trade less and become accustomed to the quick Forex market, before you start using the higher leverage of a standard account.

3) Risk only 3% of the total trading capital with each trade. Generally it’s quite hard to come up with the comfortable risk percentage value for your trades if you want to keep a good money management and still let your funds grow at a nice rate. For me 3% is the optimal level — safe enough to save and high enough to gain.

4) Reward-to-risk ratio should be no lower than 1. Many currency traders prefer trading with the ratio not less than 2 or even higher. That’s a problem of risk/gain balance too. For me the opportunities with the ratio above 2 are very rare — maybe, because I prefer high accuracy trades. If your accuracy rate is far from 90% than sticking to reward-to-risk ratio of 2 would probably be a better decision.

5) Don’t leave the positions open through the weekend. The weekly opening gap can be a killer. Don’t underestimate it. As a swing trader, I prefer to open my positions in the beginning of the week and I always close them before trading ends on Friday. The gap in the price rates that usually occurs after a weekend can make your stop-loss trigger far from the levels you planned it to.

6) Wait before opening a new order after you’ve just traded. If you jump into another position right after you closed or opened a previous order is a straight road to overtrading and an empty balance. I always wait some time analyzing opportunities and resting from the Forex market before setting up my next order. Maybe, for the extreme scalpers this isn’t a best decision, but for the absolute majority of the medium-term Forex traders it is.

FOUR Easy Steps to Remove Emotions from Your Forex Trading

Emotions are the one of the greatest problems of the Forex traders. Almost every beginning trader, who starts with the demo account, experiences a great success in his trading, but fails to carry this success to the real money account. What’s the problem? Emotions! When we lose we feel frustration and sometimes even despair. Winning can cause us to lose control over our actions and turn our trading into a gambling or cause a serious overtrading. So here are the four easy steps to stop emotions from ruining your Forex trading:

1. Single loss is not your fault. It’s not even the market’s fault. And it’s not your system’s fault. It’s just a loss. No trader or system can guarantee 100% winning rate. So, losses should happen. If you lose then your system works. It may even lose again, but that won’t change the full picture. Trading doesn’t work with a single loss or win; it works with the loss rate and risk-to-reward ratios. So, next time you lose, remember that there is no one to blame, because there is no guilt in losing.

2. If the losses prevail over the winning positions then check your risk-to-reward ratio first. If each of your losses is less than a third of your single winning position then maybe your system is intended to work with 65% of your positions in the red zone? If your risk-to-reward ratio doesn’t compensate your poor loss-to-win ratio, you still don’t have to blame yourself, the market or your system. Probably, it’s just the wrong system for the market you are trading in. Time changes and the old systems stop working, while the new ones are created. Just switch to something else and continue your pursuit of success.

3. Single winning position is not an indicator of your success. The same as with the losses don’t treat a single win as your accomplishment. It’s just a part of the routine process of trading Forex.

4. If your winning rate is high during the long period of time and the risk-to-reward ratio is rather low then I can congratulate you with finding the right strategy that worked fine for the kind of market you were trading on during that period. That’s it! Stick with it until your winning rate declines below the satisfying level.

Advantages of Online Trading!

Online futures commodities trading places the smart, self-directed trader in complete control of his or her trading decisions and executions
Futures Trades are instantly routed to the trading floor for immediate execution
Electronic futures such as E-Minis are filled in as little as one second
Fill reports are delivered promptly via electronic processing. The capacity for errors is theoretically lessened because there are fewer humans in the chain.
Risk management through easy account access: Online traders can quickly and easily check their order or account status at any time
Eliminate the broker-client “chit-chat” and execute your orders as soon as you want to
Save Your Money. Eliminate the middleman – you make your trades directly via the internet – online trading reduces the many overhead costs in trading that are typically passed to traders.

If you keep these things in mind as you get started trading, you will be doing yourself (and your account) a favour. I’ve never seen anyone regreting it.