Read the Daily Forex Trading Analysis

Today’s US Dollar Trading
• USD holds gains but volumes drop
• US data mixed
• Higher equities and lower oil support USD

Overnight Preview
• Expect the USD to consolidate
• No real news out ahead of US CPI on Friday

Looking Ahead
All times EASTERN (-5 GMT)
• 8:30am USD Core CPI m/m 0.2%
• 8:30am USD CPI m/m 0.5%
• 9:55am USD Prelim Michigan Sentiment 59.5

Summary
The USD is holding onto gains this afternoon after surprise US data helped underpin the Greenback; traders note that although the USD strength this week has been significant the majors are holding key S/R. Volumes have been only moderate and suggest that more news or rhetoric will be needed to break the USD higher as stops were cleared today leaving less interest on the bid. Forex traders note that the EURO in particular may be bottoming again as several shops have said that offers dried up on the move under the 1.5400 handle today as “no one wants to be short EURO under 1.5400” traders say. In my view, the EURO has really squeezed out the weak longs and offered a lot of volatility the past 4-5 days suggesting that there is a serious fight for control of the market between 1.5400 and 1.5800; above the 1.5800 the bulls look for new highs above the 1.6050 area to fall quickly and below 1.5400 the bears look for a confirmation of a serious correction. Both sides appear locked in a major struggle and the first side to gain control will likely dominate trade for several weeks. Cable had lows at 1.9432 after US retail sales data showed a bigger than expected improvement but a short-covering rally never materialized and the rate stagnated around the 1.9460 area for the whole day. EURO low prints at the 100 bar MA were bought; closing around the 1.5420/25 area suggests a bounce is coming to end the week. USD/JPY continued to remain firm and tag the 108.00 handle; highs at 108.09 were on thin volume and the rate is laboring to hold gains. Exporters said to be seriously offering USD into the 107.80 area and above. Swissy also stalled at key resistance unable to make a break above the 1.0480 area with any confidence; high prints at 1.0492 before rotating lower to close under the 1.0430 area. In my view, this USD rally is a serious head fake and should be sold with both hands. Aggressive traders have a lot to work with now that we are at monthly highs and quarterly highs; expect the USD to fall back on big volume as the last bit of longs made their move today.


GBP/USD Daily

Resistance 3: 1.9580
Resistance 2: 1.9550
Resistance 1: 1.9500
Latest New York: 1.9477
Support 1: 1.9420/30
Support 2: 1.9400
Support 3: 1.9380

Comments
No follow-through on the day after two attempts for lows. Rate follows EURO lower into key support; a bounce is likely and aggressive traders can BUY under the 1.9500 handle. Spillover weakness from EURO still likely as would be strength. Technical objectives met at the 1.9500/50 area near-term; today could be a test of the lows. Continue to expect a lot of cross-trading; the cross-spreaders are having a field day with the Sterling crosses and I think that will continue through this week. Today’s action suggests that more two-way trade likely ahead of US data today.

Data due Friday: All times EASTERN (-5 GMT)


EURO/USD Daily

Resistance 3: 1.5500/10
Resistance 2: 1.5480
Resistance 1: 1.5450/60
Latest New York: 1.5422
Support 1: 1.5380/90
Support 2: 1.5350
Support 3: 1.5320

Comments
Rate fails to follow-through and holds the 100 bar MA. Strong buy signal coming soon if not yet later this afternoon. Rate falls on rumors and stops; could be a washout. Stopped out of position so we will look at the long side again to end the week tomorrow. Rate finds support as more rumors of semi-official demand. Stops noted on a break under the 1.5500 area. Late longs squeezed as comments from ECB officials slow upside. Support under the 1.5440 area appears solid. If buying today—ok to hold longs for a return to the 1.5800 area this week. Stops and bids noted at the 1.5580 area in size with option defense expected at 1.5550. Trichet hints at a rate hike for July but today’s rhetoric a bit softer; I think that is only to stem a rapid rise too quickly. Overhead resistance appears firmer on the approach to the 1.5800/20 area which is a likely to offer upside resistance through the rest of the week.

Data due Friday: All times EASTERN (-5 GMT)

2:00am EUR German CPI m/m
5:00am EUR Labor Cost Index
6:00am EUR Employment Change


Analysis Provided by: Forexpros.com written by Jason Alan Jankovsky

Also Check our Forex brokers section.

DISCLAIMER:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

Daily Forex Trading analysis - 16/06/08

Overnight Asia/Europe
• G-8 no mention of FOREX, threatens oil traders
• EU inflation revised higher
• USD on the defense to start the week

Today’s Economic Reports
All times EASTERN (-5 GMT)
• 8:30am USD Empire State Business Conditions Index
• 9:00am USD TIC Net Long-Term Transactions
• 1:00pm USD Pending Home Sales m/m
TICS and Pending Home Sales the big news on the day

Looking Ahead to Tuesday
All times EASTERN (-5 GMT)
• 8:30am USD Housing Starts
• 8:30am USD PPI m/m
• 8:30am USD Building Permits
• 8:30am USD Core PPI m/m
• 8:30am USD Current Account
• 9:15am USD Capacity Utilization Rate


Summary
The USD is on the defensive this morning after opening firmer to mixed in Asia overnight. The G-8 Communiqué was seen as USD bearish as no mention of currencies was made only a warning to oil speculators creating a risk to global inflation. In my view, the G-8 is missing the point—if you want to curb global inflation risks than force CHINA TO FLOAT THE YUAN; don’t punish those smart enough to take advantage of supply/demand inequalities. In any case, the USD initially fell on the remarks and remained two-way until early European trade. Upwardly revised EU HICP inflation numbers provided a brief pop high in EURO printing a 1.5475 high before dropping back a bit to open New York at 1.5460 area; Forex traders note the rate saw Russian selling around the 1.5430/40 are with stops above the 1.5450 area providing the lift into the highs. Technical trade likely ahead of additional offers in the 1.5500 area but the upside bias is there to start the week. GBP followed EURO higher making a move for stops above the 1.9580 and 1.9600 areas for high prints at 1.9649 making Cable the biggest mover on the board to start eh week. Cross-spreaders again in focus traders say as EURO/GBP spreaders take gains off the table from last week. Volumes have been modest but the GBP appears to be holding the 2008 lows again and a rotation into resistance is now likely but traders expect two-way action to continue on the way. USD/JPY continues to defy logic as the rate trades beyond the 200-day MA this morning; high prints at 108.59 a new high for the weekly charts and upside is said to be layered with offers all the way to the 2008 highs at 110.20/30 area; traders note exporters again on the offer into the highs. A close beyond the 200 bar MA for this pair likely to draw a huge amount of buying so be ready to sell into any rally near-term. In my view, the fundamentals don’t support a higher USD anyway despite the rhetoric from Paulson, Bush and Bernanke; rallies are selling opportunities. USD/CHF has stalled into the 1.0500 handle again; high prints at 1.0523 were sold and the rate is a full handle lower at 1.0425 to start New York. The strong sell signals on the daily charts are still active and aggressive traders can sell the rate anytime in my view. Today’s data is not expected to be market moving but might add a bit to the USD heaviness seen to start the week; look for the USD to whipsaw today but close lower across the board.


EUR/USD Daily

Resistance 3: 1.5550
Resistance 2: 1.5500/10
Resistance 1: 1.5480
Latest New York: 1.5463
Support 1: 1.5350
Support 2: 1.5300/10
Support 3: 1.5280

Comments
Another strong buy signal this morning suggests the rate will bottom; expect higher action all week as late shorts get squeezed. Looking to ADD to open longs if you took some on Friday—if not; looking to open a long on any weakness. Rate finds support as more rumors of Swiss private bank bids at current levels; should rate put in a long tail today a buy might be on the table for Tuesday. Stops and bids noted at the 1.5420 area in size; more said to be resting at the 1.5500. Overhead resistance appears firm at 1.5550 now that the 1.5340 area of option defense fell.

Data due Tuesday: All times EASTERN (-5 GMT)

4:00am EUR Italian Trade Balance
5:00am EUR German ZEW Economic Sentiment
5:00am EUR ZEW Economic Sentiment
5:00am EUR Trade Balance


USD/CHF Daily

Resistance 3: 1.0620
Resistance 2: 1.0580
Resistance 1: 1.0550/60
Latest New York: 1.0430
Support 1: 1.0420
Support 2: 1.0400
Support 3: 1.0380

Comments
Rate likely to draw additional selling pressure on a drop back under the 100 bar MA today; look for sell signals the past three sessions to hold. Look for a short early this week; aggressive traders who sold USD/CHF on the close Friday can look to add soon. Overhead resistance at the 1.0600 handle but rate may be getting boost from other USD strength in other pairs. Rate continues to rotate up to and fail at the 100 bar MA area; the 1.0480 area looks to be poised to offer resistance again today but a sell off to end the day is needed. Buyers appear to be technical traders and expect some momentum accounts on the bid soon. No doubt some bids are profit-taking from the shorts but that won’t last in my view. Any rally likely to attract selling again so be ready for a short next week. In my view, the rate needs to be sold on any strength.

Data due Tuesday: All times EASTERN (-5 GMT)

3:15am CHF Industrial Production q/q


Analysis Provided by: Forexpros.com written by Jason Alan Jankovsky

Also Check our Forex brokers section.

DISCLAIMER:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

Today’s US Dollar Trading
• USD retreats from Friday’s gain
• US data benign—points to more losses
• Speculation grows that USD will fall

Overnight Preview
• Look for the USD to consolidate
• Expect two-way action

Looking Ahead to Tuesday
All times EASTERN (-5 GMT)
• 8:30am USD Housing Starts
• 8:30am USD PPI m/m
• 8:30am USD Building Permits
• 8:30am USD Core PPI m/m
• 8:30am USD Current Account
• 9:15am USD Capacity Utilization Rate

Summary
The USD starts this week lower against most pairs but still two-sided as Monday draws to a close. In New York the USD saw the worst levels of the day so far as surging oil prices slammed equities and rallied the EURO. Oil prices slid off as volatility whipsawed energy prices taking the USD higher against the Swiss Franc and firming up against Yen but still unable to better the highs seen on Friday across the board. US forex trading data was benign as most reports came in lower than expected; TICS showed a decent cover but still not the whole picture as EURO remained firm near the 1.5500 handle all day. EURO rallied for a high print at 1.5520 early ahead of the London fix and keeping GBP up with it. Cable high during NY trade at 1.9690 with stops above the 1.9650 area driving the rate to the highs. Profit taking by longs dropped the rate back to the 1.9620/30 area into the close but EURO’s firmness into the end of the day suggest that both rates are poised for an additional leg higher overnight or during US trade tomorrow. If US data in the morning is again benign for the Greenback traders expect another leg lower for the USD during the day. USD/JPY remained above the 108.00 handle but under the 200 day MA making the technical picture better for the bears who argue a top is forming; USD/CHF also topping as the 1.0480 area again offers resistance all day to the USD. Highs at the 1.0523 level went unchallenged all day in NY suggesting that the Swissy is ready to drop back to below the 100 bar MA to start the week. Traders note that in all pairs the technical picture appears in focus near-term and expect dips to be bought and rallies to be sold. The big question is where are the large stops? Traders look for tomorrows’ data to push the Greenback in both directions so expect some whipsaw as the majors look for near-term direction.


EUR/USD Daily

Resistance 3: 1.5580
Resistance 2: 1.5550/60
Resistance 1: 1.5520
Latest New York: 1.5480
Support 1: 1.5350
Support 2: 1.5300/10
Support 3: 1.5280

Comments
Another strong buy signal this morning suggests the rate will bottom; expect higher action all week as late shorts get squeezed. Today’s rally likely to encounter selling pressure up to the 1.5550 and 1.5580 areas; looking to ADD to open longs if you took some on Friday—if not; looking to open a long on any weakness. Rate finds support as more rumors of Swiss private bank bids at current levels; should rate put in a long tail today a buy might be on the table for Tuesday. Stops and bids noted at the 1.5420 area in size; more said to be resting at the 1.5500. Overhead resistance appears firm at 1.5550 now that the 1.5340 area of option defense fell.

Data due Tuesday: All times EASTERN (-5 GMT)

4:00am EUR Italian Trade Balance
5:00am EUR German ZEW Economic Sentiment
5:00am EUR ZEW Economic Sentiment
5:00am EUR Trade Balance


USD/CHF Daily

Resistance 3: 1.0580
Resistance 2: 1.0550/60
Resistance 1: 1.0520
Latest New York: 1.0443
Support 1: 1.0400
Support 2: 1.0380
Support 3: 1.0320/30

Comments
Rate likely to draw additional selling pressure on a drop back under the 100 bar MA today; look for sell signals the past three sessions to hold. Look for a short early this week; aggressive traders who sold USD/CHF on the close Friday can look to add soon. Overhead resistance at the 1.0600 handle but rate may be getting boost from other USD strength in other pairs. Rate continues to rotate up to and fail at the 100 bar MA area; the 1.0480 area looks to be poised to offer resistance again today but a sell off to end the day is needed. Buyers appear to be technical traders and expect some momentum accounts on the bid soon. No doubt some bids are profit-taking from the shorts but that won’t last in my view. Any rally likely to attract selling again so be ready for a short next week. In my view, the rate needs to be sold on any strength.

Data due Tuesday: All times EASTERN (-5 GMT)

3:15am CHF Industrial Production q/q


Analysis Provided by: Forexpros.com written by Jason Alan Jankovsky


DISCLAIMER:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.


Also Check our Forex brokers section.

It seems that I have to go again to University to understand all the above articles....Ha..ha..ha...


Nic

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Read the Daily Forex Trading Analysis

Today’s US Dollar Trading
• Overseas data USD negative
• USD rally falters in US trade
• Volumes lighter

Overnight Preview
• USD likely to remain technical in nature
• Look for more downside pressure

Looking Ahead to Wednesday
All times EASTERN (-5 GMT)
• 10:35am USD Crude Oil Inventories

Summary
The USD whipsawed today initially falling in Asia and then rallying in Europe before falling back again during New York trade. Not a lot of news supported the trade action today; overseas news was mostly supportive to the EURO and the GBP but both of them were under selling pressure early. US data this morning was USD neutral to negative but the Greenback held gains initially. Although the USD fell back to suffer minor losses against Swissy, Loonie and JPY—the USD held good gains against the GBP as UK data and rhetoric caused a stop-driven panic ahead of US trade today. Falling all the way down to a 1.9468 low print after a high at 1.9700 today’s GBP trading can only be described as “whipsaw”. The GBP recovered to trade 1.9580 into the close in New York making a mess of most balance sheets. Forex traders note that stops were run in both directions suggesting that the rate was long into the highs and then short into the lows. Leaving a long bid-tail like today’s action argues for more upside follow-on buying tomorrow. With a light economic calendar it is likely that trade will be technical the next 24 hours but with an upside bias. EURO rallied to the 1.5553 area before falling back with Cable but rallied into the end of the day again to close above the 1.5510 area suggesting more upside to come tomorrow. In my view, the majors head-faked everybody today and more losses for the USD are coming. Today’s data was seen as mildly neutral to slightly bearish and I think that most traders were temporarily focused on UK and Eurozone data this morning; once the PPI and Current Account data sink in and are compared with the poor housing data I think a further decline in the Greenback will be warranted. Look for the USD to sell off the next 24 hours or so. If holding longs in the majors get ready to add to open positions as more gains are coming I think.


GBP/USD Daily

Resistance 3: 1.9700
Resistance 2: 1.9650
Resistance 1: 1.9600/10
Latest New York: 1.9568
Support 1: 1.9500/10
Support 2: 1.9450/60
Support 3: 1.9420

Comments
Rate bounces off support at the 1.9470 area; leaves a long bid wick suggesting the downside is a head-fake. Comments from BOE reverse the rate as traders panic on the sell-side. If long, need to be patient and wait for the panic to subside and the rally to resume. Rate finds stops layered under the 1.9600 area all the way down into active selling under the 1.9500 handle; if this selling is absorbed then the rate will recover fairly quickly I think. Rumors of UK inflation concerns keeps the rate buoyed above 2008 lows. Likely cross-spreaders on the move. A bounce is likely and aggressive traders can ADD if not already long. Spillover weakness from EURO still likely as would be strength. Continue to expect a lot of cross-trading; the cross-spreaders are having a field day with the Sterling crosses and I think that will continue through this week and into the next.

Data due Wednesday: All times EASTERN (-5 GMT)

4:30am GBP MPC Meeting Minutes
6:00am GBP CBI Industrial Trends Orders
2:30pm GBP BOE Governor King Speaks


USD/JPY Daily

Resistance 3: 109.20
Resistance 2: 108.80
Resistance 1: 108.50/60
Latest New York: 107.95
Support 1: 107.60/70
Support 2: 107.20/30
Support 3: 106.80

Comments
Exponential reversal signal overnight, need to sell the rate. Close under the 108.00 area significant; look to add if rate can hit the stops in the 107.40/50 area near-term. Some topping seen; expect volatility. Today’s close under the 200 bar MA likely to draw some sympathy selling but watch volumes. Bids appear solid but so do offers; exporters on the offer all the way to the top overnight and active the past several days. Option defense noted at 107.80 through 108.20; but that has fallen this morning. Technical traders note fib defense area around today’s highs and never forget that the fundamentals haven’t changed one bit in the last week or so. USD likely not this strong but more benefiting from Yen weakness. Can the rate top at the 108.50 area? Stops likely rolled up under the 107.40 area again for today so if a break happens—look for a drop to the 106.00 handle fairly quickly. Bulls likely to take gains by end of day if rumored stops above the 108.60/70 area are left untouched.

Data due Wednesday: All times EASTERN (-5 GMT)

7:50pm JPY All Industries Activity Index m/m


Analysis Provided by: Forexpros.com written by Jason Alan Jankovsky.

Also Check our Forex brokers section.

DISCLAIMER:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

Daily Forex Analysis

Today’s US Dollar Trading
• USD two-way overnight
• Weakens in NY trade
• All eyes on US data tomorrow

Overnight Preview
• Look for the USD to consolidate with a lower tone

Looking Ahead to Thursday
All times EASTERN (-5 GMT)
• 8:30am USD Unemployment Claims
• 10:00am USD Philadelphia Fed Manufacturing Index
• 10:00am USD Leading Index m/m
• 10:35am USD Natural Gas Storage
• 2:30pm USD FOMC Member Kohn Speaks


Summary
The USD is lower to end the day in New York after a two-way overnight session that saw the USD on the best levels of the day in early US trade. Overseas data was benign and after the London fix the Greenback began to slide off as traders squared positions ahead of US economic news tomorrow. Technical trading was the rule today and most action was on the sell side of USD as the majors were able to hold above important S/R during the day. Cable rallied over the 1.9600 handle briefly as stops were elected in both directions from overnight trade. Finding support again at the 1.9470 area stops from late shorts again were placed in range and the rate rallied on moderate volume. Making an inverted hammer on the daily charts traders expect the GBP to rally again on Thursday after US data; ahead of there expect a lot of two-way action and potential whipsaw although the 1.9470 area appears solid as support. EURO rallied all day and challenged overnight Asian highs above the 1.5520 handle late in the day but high prints at 1.5539 remained on the day; more two-way action is expected tonight ahead of US data in the morning. USD/JPY fell through light stops to make lows on the day at the 107.70 area before rebounding; Forex traders note that stops under the 107.50 area remain untouched for now and are building into the end of the week. Without a bit of upside help the rate appears ready to drop into reported support under the 107.00 handle. Swissy is also under pressure to end the day dropping to a low print at 1.0355 before a slight bounce; traders note that the rate is under the important 100 bar MA again into the close. Despite a rather lackluster session with little news to focus on the USD is weaker on technical factors again. I would look for the Greenback to continue to consolidate with a weaker tone overnight. Look for the majors to advance again during the day tomorrow as US news is not likely to be friendly in the morning.


EUR/USD Daily

Resistance 3: 1.5600
Resistance 2: 1.5580
Resistance 1: 1.5550/60
Latest New York: 1.5526
Support 1: 1.5440/50
Support 2: 1.5380
Support 3: 1.5350

Comments
Near the highs around the 1.5550 area suggests more follow-on buying. Rate remains trapped inside range; pressured along with GBP but holds support at 1.5470 area. Looking for a long on next push into highs—then a pullback. If rate can clear the 1.5550 area and then fall to support around the 1.5500 area I think we are on the buy side at that point. Expect higher action all week as late shorts get squeezed. Rate finds support as more rumors of Russian and Mid-East buyers; Swiss private bank on the offer overnight. Should rate put in a long tail today a buy might be on the table. Stops and bids noted at the 1.5420 area in size; more said to be resting at the 1.5500 area; all in range. Overhead resistance appears firm at 1.5550 with stops above.

Data due Thursday: All times EASTERN (-5 GMT)

4:00am EUR Italian Unemployment Rate


USD/JPY Daily

Resistance 3: 109.20
Resistance 2: 108.80
Resistance 1: 108.50/60
Latest New York: 107.88
Support 1: 107.60/70
Support 2: 107.20/30
Support 3: 106.80

Comments
Exponential reversal signal overnight, need to sell the rate. If short—let it work. Close under the 108.00 area significant today; look to add if rate can hit the stops in the 107.40/50 area near-term. Some topping seen; expect volatility. Today’s close under the 200 bar MA likely to draw some sympathy selling but watch volumes. Bids appear solid but so do offers; exporters on the offer all the way to the top overnight and active the past several days. Technical traders note fib defense area around today’s highs and never forget that the fundamentals haven’t changed one bit in the last week or so. USD likely not this strong but more benefiting from Yen weakness. Stops likely rolled up under the 107.40 area again for today so if a break happens—look for a drop to the 106.00 handle fairly quickly. Bulls likely to take gains by end of day again if rumored stops above the 108.60/70 area are left untouched.

Data due Thursday: All times EASTERN (-5 GMT)

Tentative JPY BOJ Governor Shirakawa Speaks


Analysis Provided by: Forexpros.com written by Jason Alan Jankovsky.

Also Check our Forex brokers section.

DISCLAIMER:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

Read the Daily Forex Trading Analysis

Overnight Asia/Europe
• USD firms a bit
• Technical trade and stops drive GBP and EURO
• Volumes moderate

Today’s Economic Reports
All times EASTERN (-5 GMT)
• None for the day
Expect technical trade for the most part

Looking Ahead
All times EASTERN (-5 GMT)
• 9:00am USD National HPI Composite-20
• 10:00am USD Consumer Confidence
• 10:00am USD House Price Index m/m
• 10:00am USD Richmond Fed Index

Summary
The USD is two-way overnight but starts the New York session on the offensive. Still range-bound against Swissy and Yen, the Greenback has recovered some of the losses from late last week. After starting firm in Asia and weakening on exporter supply, the USD/JPY has advanced back to the 107.80 level for a high print in New York at 108.89 but traders see a lot of offers layered up to the technical resistance area of 108.00/10. Stops are said to be over that figure but the overall sentiment is for lower USD/JPY for the week. Swissy is back in the sell zone around the 1.0440/50 area; aggressive traders can look to sell the pair anywhere over the 1.0440 area in my view. The rate is technically weak trading higher on lighter volume and stops above the 1.0410 area so a pullback and long selling wick would be ideal today in that pair. Cable has dropped dramatically tracking EURO lower as both rates suffer from cross-spreading and poor German IFO data. Cable fell from the high print at 1.9760 overnight for a low print in early New York at 1.9699 and remains under pressure. Forex traders note that the lower-than-expected German IFO data disappointed EURO dropping the rate back into close-in stops at the 1.5550 area for a low print in late Europe at 1.5498 where Asian sovereign demand was seen. Aggressive traders can look to buy EURO under the 1.5520/30 area today and expect a buy signal during New York action today. Across the board traders note that volumes are modest and action is technical. All the pairs are trading inside established ranges from last week so nothing really significant is happening just yet. In my view, you can expect a further decline in GBP today and through the week while the USD/JPY and USD/CHF will likely remain range-bound and under pressure. Expect a slow-grind in those pairs. EURO is likely to firm up and advance this week as the technical’s look positive and the market needs to price in a 25 BP rate hike coming in two weeks from the ECB. Look for the USD to remain two-way but weaker today.


GBP/USD Daily

Resistance 3: 1.9750/60
Resistance 2: 1.9720
Resistance 1: 1.9680
Latest New York: 1.9612
Support 1: 1.9580
Support 2: 1.9550
Support 3: 1.9520

Comments
Toolbox provides another strong sell signal overnight, target is short is around the 1.9480/19500 area through the week. Surging oil prices helped EURO last week but a softer start is likely spilling over into GBP. Spillover weakness from EURO still likely all week. Continue to expect a lot of cross-trading. Aggressive traders can add to their open shorts anywhere under the 1.9650 area I think; if not short sell a rally into the 1.9650/80 area if you get it today.

Data due Tuesday: All times EASTERN (-5 GMT)

4:30am GBP BBA Mortgage Approvals

EUR/USD

Resistance 3: 1.5680
Resistance 2: 1.5650/60
Resistance 1: 1.5620/30
Latest New York: 1.5523
Support 1: 1.5550
Support 2: 1.5500
Support 3: 1.5470

Comments
Rate drops back under the 1.5550 area to start the week; should get a buy signal the next day or so. The 50 bar MA offering resistance; close over the 50 bar likely to draw more buying early in the week but for now there is pressure coming on in that area. Close Friday above the 1.5550 area failed to attract more buying, drop into close in stops near the 1.5550 area from late longs; a dip is likely a buying opportunity. Bids will likely be in the 1.5500/20 area or so. Expect higher action next week as late shorts get squeezed. If long, OK to hold over the weekend. Buy the next dip to add to positions.

Data due Tuesday: All times EASTERN (-5 GMT)

Tentative EUR German Import Price Index
2:45am EUR French Consumer Spending


Analysis Provided by: Forexpros.com written by Jason Alan Jankovsky.

Also Check our Forex brokers section.

DISCLAIMER:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

Daily Forex Trading Analysis

Today’s US Dollar Trading
• USD holds gains but flows light
• S/R holds as expected
• Speculation that the Fed will not move rates capping the USD

Overnight Preview
• Consolidation likely
• Two-way action with a downside bias

Looking Ahead to Tuesday
All times EASTERN (-5 GMT)
• 9:00am USD National HPI Composite-20
• 10:00am USD Consumer Confidence
• 10:00am USD House Price Index m/m
• 10:00am USD Richmond Fed Index

Summary
The USD is firmer but falling off the highs for the day as the volumes are drying up into the New York close. Traders note that across the board the USD remained inside established ranges to start the week and due to the two-way nature of today’s action most traders expect more consolidation. Volumes got really light after the London fix most desks say and it is likely that traders don’t want to force positions ahead of the two-day FOMC meeting which starts tomorrow. Analysts are almost unanimous that the Fed will not move rates on Wednesday but are divided as to the significance of the statement. Most are expecting Bernanke to “talk tough” but no one expects the Fed to do anything for the next two or three FOMC meetings. In response to poor European news overnight the EURO and GBP both fell back to near-term support but rallied off those lows after the London fix this morning and are now at their highs for the New York session into the close. EURO has regained the 1.5520 area after dropping into the 1.5460/70 area on light volume this morning. Forex traders expect EURO to remain two-way through the week with technical trading likely; most analysts say the rate is “fairly” pricing in a 25 BP hike by the ECB on Jul 3rd. In my view, the FOMC is the key to the trade this week as no move at all will work favorably for the EURO. USD/JPY continued to hold gains but was unable to attract any serious buying at the high prints of 108.07; stops rumored to be above the 108.10 area are out of range today. Traders expect the rate to weaken near-term as the technical picture favors at least a test of the 107.00 handle this week. In my view, the rate is due for a sharp sell-off as all these longs must be getting nervous now that the rate has failed at the quarterly highs several times. Look for the USD/JPY to rotate lower overnight and test the south end of the range the next 24 hours. Swissy is also failing at key resistance, the 1.0480 area. Offers from late longs appear to be active as no stops were reported above the 1.0410/20 area only active buying. Now that those longs are under threat expect a pullback into the 1.03 handle soon. Should be a quiet night ahead of US data tomorrow; don’t expect any surprises.


USD/JPY Daily

Resistance 3: 108.80
Resistance 2: 108.50
Resistance 1: 108.00/10
Latest New York: 107.81
Support 1: 107.20/30
Support 2: 107.00
Support 3: 106.80

Comments
Rate grinding sideways to higher overnight; volumes lighter and upside resistance is firm at 108.00 area. Failure to close above the 108.00 handle Monday a good sign rate is ready to break back to the lows looking for stops under the 107.10/107.00 area. Exponential reversal signal still valid, rate is two-way but weaker each day. If short—let it work. If today’s rally fails under the 108.00 handle look for a drop into stops under the 107.00/10 area the next 24 hours. Look to add if rate can hit the stops in the 107.00 area near-term. Some topping seen; expect volatility. Bids appear solid but so do offers; exporters likely on the offer all the way to the highs overnight and active the past several days. USD likely not this strong but more benefiting from Yen weakness. Stops likely rolled up under the 107.00 area for today so if a break happens—look for a drop to the 106.00 handle fairly quickly.

Data due Tuesday: All times EASTERN (-5 GMT)

7:50pm JPY Trade Balance
7:50pm JPY CSPI


USD/CHF Daily

Resistance 3: 1.0520
Resistance 2: 1.0480
Resistance 1: 1.0450/60
Latest New York: 1.0457
Support 1: 1.0320/30
Support 2: 1.0300
Support 3: 1.0270/80

Comments
Rate rallies back to resistance, fails at 1.0480 area as expected. Rate stuck in a range but still looking to support/resistance hovering around the 100 bar MA. Overhead resistance now at the 1.0480 area. Rate continues to rotate up to and fail at the 100 bar MA area; a sell off to end the day today would be ideal to set-up for further losses during the week. Buyers appear to be technical traders and expect some momentum accounts on the bid soon. No doubt some bids are profit-taking from the shorts but that won’t last in my view. In my view, the rate needs to be sold on any strength. Hourly sell signals also suggest that the rate is ready to rotate lower again. Look for two-way action overnight into Tuesday.

Data due Tuesday: All times EASTERN (-5 GMT)

4:00am CHF Consumption Indicator


Analysis Provided by: Forexpros.com written by Jason Alan Jankovsky.

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DISCLAIMER:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

Read the Daily Forex Trading Analysis

Today’s US Dollar Trading
• USD two-way all day
• Starts on the offensive—ends on the defensive
• GBP and EURO at technical resistance.

Overnight Preview
• Look for a quiet evening ahead of FOMC

Looking Ahead
All times EASTERN (-5 GMT)
• 8:30am USD Core Durable Goods Orders m/m
• 8:30am USD Durable Goods Orders m/m
• 10:00am USD New Home Sales
• 10:30am USD Crude Oil Inventories
• 2:15pm USD FOMC Statement
• 2:15pm USD Federal Funds Rate

Summary
Despite a better start overnight the USD was unable to hold significant gains today after the release of disappointing US data gave traders a reason to sell the Greenback. Although the early volatility was important enough to make new highs or lows on the day for the USD it wasn’t enough to put most pairs into new ranges; Forex traders note that volumes were moderate and both sides seemed to find a reason to take a stand. Trading has been muted the past 24 hours with most desks reporting that concern over the FOMC rate announcement due out tomorrow is keeping larger players quiet; although larger names have been seen at the highs or lows today. Cable initially firmed following EURO but took at hit when the UK mortgage numbers overnight were less than inspiring. Falling to a low print at 1.9622 in early New York the GBP reversed course and rallied to a high print at 1.9726 before offers capped the move today. US data lifted both the GBP and the EURO but neither pair could hold gains as both pairs were at technical resistance during the day. EURO stalled just above the 50 bar MA for a high print at 1.5623 before falling back and leaving a long selling wick on the day. I suggested earlier in the day to liquidate your long EURO position and if you are holding longs still be ready to exit those positions overnight. I don’ think the EURO has what it takes to hold above the 50 bar MA near-term. USD/JPY broke down to post a daily low at 107.36 before rallying all the way back to the 108.00 handle; then dropping mid-range on the close. At no time did the rate ever make the impression it intended to break out to a new high or a new low. Traders note that the rate is simply stuck in an existing range and may be there through the FOMC announcement tomorrow. Swissy also broke to new lows at the 1.0348 number before bouncing off the 50 bar and 100 bar MA’s on the daily chart. In my view, the USD/CHF is firming a bit too much to be short. I would look to take the trade off the next 24 hours if the rate continues to gain above the 1.0400 handle near-term; such as overnight. In my opinion, the USD will cover a lot of the same ground tonight and into the FOMC meeting tomorrow. Look for a rally as a selling opportunity.


EUR/USD Daily

Resistance 3: 1.5680
Resistance 2: 1.5650/60
Resistance 1: 1.5620
Latest New York: 1.5567
Support 1: 1.5500/1.5490
Support 2: 1.5470
Support 3: 1.5450

Comments
Rate unable to hold gains after surprise rally into the 1.5620 area; long selling wick companion to the bid wick from Monday. Rate likely stuck in tighter range for now. Russians buying EURO a good sign but watch for model accounts on the bid the next few days. The 50 bar MA offering resistance; close over the 50 bar likely to draw more buying early in the week but for now there is pressure coming on in that area. Bids will likely be in the 1.5500/20 area or so. Expect higher action this week as late shorts get squeezed. If long, better to get flat or reverse.

Data due Wednesday: All times EASTERN (-5 GMT)

4:00am EUR ECB President Trichet Speaks
4:00am EUR Italian Retail Sales m/m


USD/JPY Daily

Resistance 3: 108.80
Resistance 2: 108.50
Resistance 1: 108.20
Latest New York: 107.76
Support 1: 107.20/30
Support 2: 107.00
Support 3: 106.80

Comments
Rate whipsaws around current S/R; unable to gain traction above or below recent boundaries. Volumes lighter and upside resistance is firm at 108.00 area or a shade higher. Failure to close above the 108.00 handle Monday a good sign rate is ready to break back to the lows looking for stops under the 107.10/107.00 area. Exponential reversal signal still valid, rate is two-way but weaker each day. If short—let it work. If today’s rally fails under the 108.00 handle look for a drop into stops under the 107.00/10 area the next 24 hours. Look to add if rate can hit the stops in the 107.00 area near-term. Some topping seen; expect volatility. USD likely not this strong but more benefiting from Yen weakness. Stops likely rolled up under the 107.00 area for today so if a break happens—look for a drop to the 106.00 handle fairly quickly.

Data due Wednesday: All times EASTERN (-5 GMT)


Analysis Provided by: Forexpros.com written by Jason Alan Jankovsky.

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DISCLAIMER:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

Daily Forex Trading Analysis

Today’s US Dollar Trading
• USD whipsaws after early sideways start
• US data unfriendly to the Greenback
• As expected, FOMC holds rates firm

Overnight Preview
• USD likely to continue to weaken
• EURO above resistance

Looking Ahead
All times EASTERN (-5 GMT)
• 8:30am USD Final GDP q/q
• 8:30am USD Unemployment Claims
• 8:30am USD Final GDP Price Index q/q
• 10:00am USD Existing Home Sales
• 10:35am USD Natural Gas Storage

Summary
As expected the FOMC held interest rates steady and left the discount window on hold too. The statement was full of the usual “Strong Dollar” rhetoric but after the initial brief USD rally into expected S/R the Greenback reversed hard and fell to new lows on the day across the board. Stops were seen in all pairs but active selling of USD was noted by several shops as the USD made highs around the FOMC announcement. Forex traders were not surprised at the strength of the reversal or the speed and many expressed concern that the USD will get ahead of itself on a decline before the ECB has a chance to raise rates next week. GBP rallied for a high print at 1.9771 after the announcement; traders note that stops were elected at 1.9740/50 area after the first push to there was repelled during the day. In other words, shorts sold ahead of the news and placed their stops close-in expecting a drop which never happened. EURO plowed through near-term resistance and is no officially rallying; stops placed around the 1.5630 area were triggered as layered supply above the 1.5600 area was absorbed after the news. EURO now has no top ahead of the 1.5800/20 area some traders say and a sustained rally may be in the works for tomorrow and Friday. Should the EURO clear the 1.5800 area or beyond by the end of the week that would make this month an engulfing month on the charts—a very bullish scenario. USD/JPY failed to inspire trade either way for most of the day preferring to hover at the 108.00 handle until the Fed news; a brief rally to 108.43 high print was sold aggressively and the rate reversed into low prints at 107.65 within minutes. The rate is unable to break out of the 108.40-107.00 range that has plagued this pair for over a week. When it finally goes one way or the other it could be a spectacular move. USD/CHF also reversed hard making lows on the day at 1.0340; traders expect more. Almost lost in the day’s action was earlier US data, Durables were flat and housing was lower; traders expect that more unfriendly news will be seen for tomorrow as well. In my view, nothing to do but buy dips in EURO and add to open shorts in other pairs.


EUR/USD Daily

Resistance 3: 1.5800
Resistance 2: 1.5750/60
Resistance 1: 1.5720
Latest New York: 1.5674
Support 1: 1.5550/60
Support 2: 1.5500
Support 3: 1.5450

Comments
Rate blasts through resistance and makes highs for the week. Better EMU news helps keep the rate firm. US news likely to create volatility. Russians buying EURO again overnight a good sign but watch for model accounts on the bid the next few days. The 50 bar MA offering resistance; close over the 50 bar likely to draw more buying tomorrow. Bids will likely be in the 1.5580 area or so on any meaningful correction. Expect higher action this week as late shorts get squeezed.

Data due Thursday: All times EASTERN (-5 GMT)

2:00am EUR German Import Price Index m/m
4:00am EUR M3 Money Supply y/y


USD/CHF Daily

Resistance 3: 1.0520
Resistance 2: 1.0500
Resistance 1: 1.0470/80
Latest New York: 1.0350
Support 1: 1.0320/30
Support 2: 1.0300
Support 3: 1.0270/80

Comments
Tight range and low volumes overnight; rate likely to whipsaw today so be ready for volatility. Looking to add to position if rate can clear under the 1.0300/10 area. Rate stuck in a range but still looking to support/resistance hovering around the 100 bar MA. Overhead resistance now at the 1.0480 area. Rate continues to rotate around the 100 bar MA area; a sell off to end the day today would be ideal to set-up for further losses during the week. Buyers appear to be technical traders and expect some momentum accounts on the bid soon. No doubt some bids are profit-taking from the shorts but that won’t last in my view. In my view, the rate needs to be sold on any strength. Hourly sell signals also suggest that the rate is ready to rotate lower again.

Data due Thursday: All times EASTERN (-5 GMT)


Analysis Provided by: Forexpros.com written by Jason Alan Jankovsky.

You can also visit our forex brokers section, compare brokers and more.

DISCLAIMER:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.