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Today’s US Dollar Trading
• USD finds stops and advances
• USD Sellers attempting to take control
• Volumes lighter on the advance

Overnight Preview
• Advance likely to suffer profit taking
• Longs due to liquidate

Looking Ahead to Tuesday
All times EASTERN (-5 GMT)
• 8:30am USD Trade Balance
• 10:00am USD IBD/TIPP Economic Optimism

Big day for the GBP and the Yen for data.

Summary
The USD continued its march higher against the forex trading major pairs today after putting in a fragile bottom overnight. Despite the lack of volume and the key support numbers trading in Asia USD traders continued to find offers outweighing bids for the New York session. Leading the drop lower was EURO dragging GBP behind it; low volume breaks into the overnight low at 1.4908 were bought by large names traders say but that was not enough to prevent a break into stops under the 1.4900 handle for a low print at 1.4880. Cable was forced lower as well finding stops at the 1.9100 handle and 1.9080 area for a low print at 1.9066; Forex traders note that stops were the main driver into the lows in GBP and EURO suggesting that buyers have been active on the dips but offers still are larger near-term. USD/JPY stalled at the 110.40/50 area and was unable to extend overnight gains as the rate continued to lag the other pairs. Cross-spreaders for EURO and GBP continued to underpin the majors against the Yen and traders expect more from the Yen on the downside near-term but admit that order books are getting thin on the decline. USD/CHF also stalled for a high print at 1.0882 overnight and held firm all day near the highs but still was unable to extend gains. In view of the Majors dropping to technical support twice in the past 48 hours the USD appears to be overbought across most studies. A reversal is due and depending on the strength of that reversal it is possible that the USD is trying to develop a new uptrend. In my view, the correction in the long-term USD downtrend is still valid but the correction is due to end and the downtrend is due to resume. Look for US data tomorrow to be USD neutral to weaker. Volumes have been lighter on this rally than last week and large names are buying the dips; it appears the USD rally is about done despite excessive extension of the ranges.


GBP/USD Daily

Resistance 3: 1.9300/10
Resistance 2: 1.9280
Resistance 1: 1.9250/60
Latest New York: 1.9093
Support 1: 1.9050/60
Support 2: 1.9020
Support 3: 1.9000

Comments
Rate falls back in sympathy with EURO; rate is under pressure from stops. Volumes lighter into the lows. Stops and technical buying seen from some desks, buying seen from semi-official names on Friday and possibly the early higher action today signals a bottom is in. Stopped out of another long but keep looking at the long side. Rate has likely flushed out every long now and shorts will likely take gains soon leaving the rate vulnerable to a sharp rally. Possible buying from semi-official names so watch the news. Offers above the market mixed with stops from late shorts so be ready for whipsaw the next few days. Traders expect GBP to track EURO through this week. Continue to expect a lot of cross-trading.

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

4:30am GBP CPI y/y
4:30am GBP Core CPI y/y
4:30am GBP DCLG HPI y/y
4:30am GBP RPI y/y


EUR/USD Daily

Resistance 3: 1.5220
Resistance 2: 1.5150/60
Resistance 1: 1.5080
Latest New York: 1.4900
Support 1: 1.4880
Support 2: 1.4850
Support 3: 1.4800/10

Comments
Rate making lows in early trade but then bounces hard, technical selling evident from model accounts traders say suggesting that the rate has finally bottomed. Gap lower has been filled making for a technical buy signal from the lows. Market is heavily short now so expect a rally. Larger names buying traders say. Likely the rate has flushed all longs. Macro accounts seen selling on the break Friday. Aggressive traders can buy this dip for a return to resistance although we were stopped out of first attempt at a long. Rate continues to track Cable and vice-versa. Now that stops are cleared a rotation higher is coming. US data this week likely to be unfriendly so be ready for whipsaw.

Data due Tuesday: All times EASTERN (-5 GMT)
2:45am EUR French CPI m/m


Forex 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 ends mixed-to-weaker
• Official names selling rallies
• Majors ready to rally

Overnight Preview

• Look for more consolidation with a lower boas

Looking Ahead to Wednesday
All times EASTERN (-5 GMT)
• 8:30am USD Core Retail Sales m/m
• 8:30am USD Retail Sales m/m
• 8:30am USD Import Price Index m/m
• 10:00am USD Business Inventories m/m
• 10:35am USD Crude Oil Inventories

Summary
The USD ends today mixed after running stops in both directions today; whippy conditions and thinner volumes helped the Greenback to see some volatility today. Initially better on the day and into European closes the USD reversed today against Yen and EURO but held firm against GBP and Swissy. Although the sentiment is for further USD gains most forex traders are reporting the recent rally may have run its course for now and with more potentially negative USD news due the next few days some traders are seeing profit taking on the sell side today. Rumors of Russian bids and Swiss bids in EURO helped to underpin that rate with the pair making highs in early New York after the release of better Balance of trade data today. Rallying to a high print at 1.4966 the rate was able to hold gains through the day despite some selling pressure spillover from GBP. Cable was unable to hold gains at all today slipping to the 1.8980 area into the close after holding above the 1.9000 handle most of the day; traders note cross-spreading was likely contributing to the weakness in GBP. USD/JPY finally saw the offers take control of the market as stops were triggered under the 109.50 area for low prints late in the day at 109.28; earlier rallies above the 110.00 handle were turned back after several attempts to make highs and now the rate appears to have topped. USD/CHF is in a similar situation but has managed to hold a bit firmer but still off the highs at 1.0928; looks like a close at 1.0860 area is in the works. On the day the USD is looking weaker and I expect a bit more downside with volatility to result; there are a lot of people with the “buy the dip” mentality waiting for a technical pullback; in my view the USD is setting up for sharply lower prices near term.


GBP/USD Weekly

Resistance 3: 1.9220
Resistance 2: 1.9180
Resistance 1: 1.9150
Latest New York: 1.8966
Support 1: 1.8960
Support 2: 1.8920
Support 3: 1.8900

Comments
Rate falls back in sympathy with EURO; makes lows late in the day while other pairs hold firm suggesting cross-spreading and whipsaw. Rate is under pressure from stops under 1.9000 initially despite higher CPI. Volumes lighter into the lows. Technical buying seen from some desks, buying seen from semi-official names last week and likely more this week. Rate has likely flushed out every long now and shorts will likely take gains soon leaving the rate vulnerable to a sharp rally. Possible buying from semi-official names so watch the news. Offers above the market mixed with stops from late shorts so be ready for whipsaw the next few days. Traders expect GBP to track EURO through this week. Continue to expect a lot of cross-trading.
Data due Wednesday: All times EASTERN (-5 GMT)
4:30am GBP Claimant Count Change
4:30am GBP Average Earnings Index y/y
4:30am GBP Unemployment Rate
5:30am GBP BOE Inflation Report

EUR/USD Weekly

Resistance 3: 1.5000/10
Resistance 2: 1.4980
Resistance 1: 1.4930
Latest New York: 1.4922
Support 1: 1.4800/10
Support 2: 1.4760
Support 3: 1.4720/30


Comments
Net higher day argues for possible short-squeeze. Rate making lows in early trade but then bounces hard, technical selling evident from model accounts traders say suggesting that the rate has finally bottomed. Gap lower has been filled making for a technical buy signal from the lows. Market is heavily short now so expect a rally. Larger names buying traders say. Likely the rate has flushed all longs. Macro accounts seen selling on the break Friday. Aggressive traders can buy this dip for a return to resistance although we were stopped out of first attempt at a long. Rate continues to track Cable and vice-versa. Now that stops are cleared a rotation higher is coming. US data this week likely to be unfriendly so be ready for whipsaw.

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

5:00am EUR Industrial Production m/m

Join us for the Afternoon US Dollar Wrap-Up daily at 3:15 pm Central/Chicago time (GMT -6)

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
Overnight Asia/Europe

• Quiet start overnight, USD range-bound
• Volumes lower
• Technical trade dominates due to lack of news

Today’s Economic Reports
All times EASTERN (-5 GMT)
• 1:00pm USD NAHB Housing Market Index

Looking Ahead
All times EASTERN (-5 GMT)
• 8:30am USD Building Permits
• 8:30am USD PPI m/m
• 8:30am USD Core PPI m/m
• 8:30am USD Housing Starts
• 10:00am USD FOMC Member Fisher Speaks

Summary
The USD is mixed to open New York after a relatively quiet start in Asia last night; no real economic news was released leaving the Greenback to trade on mostly technical factors. Now that the panic-buying of USD has largely subsided from late last-week forex traders are holding the majors in a consolidative pattern to start the week. Normally seen on the bid for EURO during the sharp sell-off recently, major Swiss names seen on the offer overnight around the 1.4650 area traders say; high prints in the rate at 1.4769 in Asian trade. US investment houses seen on the bid this time most likely covering recent shorts; traders note cross-trading for non-USD pairs pressuring EURO as well. Normally following EURO lower but firming today, Cable has held last week’s low so far today with a low print at 1.8624 and the toolbox is flashing an exponential buy this morning. Aggressive traders can buy GBP/USD at the 1.8680 area or better during the day. Tuesday will likely be a big day for both EURO and GBP due to the fundamentals being released making Monday a set-up day. With the heavy selling pressure in both pairs recently a short-squeeze is overdue; in my view getting a position on today ahead of potentially negative news for the USD with corresponding positive news from overseas makes for a good probability of higher EURO and GBP pricing mid-week. USD/JPY is lower making lows under the 110.00 handle in Asia overnight; bids seen from US names traders say as well as importers. The rate is currently holding inside range on light volumes suggesting the rate is still seeing a potential top under the 110.50 area. OK to hold shorts through the day. USD/CAD opened lower and dropped to a 1.0542 low print; if holding shorts you would have added to the rate on the break to 1.0560 area. Currently a bit higher on the day around the 1.0600 handle traders note a lot of technical trade keeping the rate two way to start New York. After taking losses this month, the sucker-rally in the USD appears to be finally faltering putting us in a position to recover during the second half of the month. Look for the USD to weaken during the week but still place stops on open positions; volatility has increased so be protected from whipsaw.

GBP/USD Daily

Resistance 3: 1.8780
Resistance 2: 1.8750/60
Resistance 1: 1.8720/30
Latest New York: 1.8671
Support 1: 1.8620/30
Support 2: 1.8600
Support 3: 1.8580

Comments
After all said and done the rate ends off the lows with a strong buying wick Friday, today’s open shows net bid follow-through. Look for more upside this week. Possibly shorts covering ahead of the news due Tuesday. Rate bouncing off two-year lows and is an excellent buy in my view. Rate has likely flushed out every long now and shorts will likely take gains soon leaving the rate vulnerable to a sharp rally. Possible buying from semi-official names so watch the news. Offers above the market mixed with stops from late shorts so be ready for whipsaw the next few days. Traders expect GBP to track EURO through this week. Continue to expect a lot of cross-trading. Get ready for the rally.

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


EUR/USD Daily



Resistance 3: 1.4850
Resistance 2: 1.4820/30
Resistance 1: 1.4770/80
Latest New York: 1.4716
Support 1: 1.4700/10
Support 2: 1.4650/60
Support 3: 1.4620/30

Comments
Stops-driven sell-off scores new low last week but rate bounces smartly suggesting at least a small interest in bottoming. Traders report large bids on the drop, lower oil pricing pressures prices all day. Traders report model/macro accounts continue selling the rate. Traders suggesting that the rate is vulnerable to a short squeeze. Market is heavily short now so expect a rally. Larger names buying last week traders say. Likely the rate has flushed all longs. Aggressive traders can buy this dip for a return to resistance. Rate continues to track Cable and vice-versa. Now that stops are cleared a rotation higher is coming. US data this week likely to be unfriendly so be ready for whipsaw.

Data due Tuesday: All times EASTERN (-5 GMT)
2:00am EUR German PPI m/m
5:00am EUR German ZEW Economic Sentiment
5:00am EUR ZEW Economic Sentiment


Join us for the Morning FOREX Briefing daily at 7:45 AM Central/Chicago time (GMT -6)

Forex 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 Analysis

Today’s US Dollar Trading

• Greenback unable to extend gains
• Volumes light
• Big news out tomorrow may have sidelined traders

Overnight Preview

• Look for two-way action, consolidation
• Possible follow-on selling in Asia to start

Looking Ahead
All times EASTERN (-5 GMT)
• 8:30am USD Building Permits
• 8:30am USD PPI m/m
• 8:30am USD Core PPI m/m
• 8:30am USD Housing Starts
• 10:00am USD FOMC Member Fisher Speaks

Summary
Heading into the close for Monday the USD is slightly mixed as pressure from equities rubs a little shine off the bull’s horns; most of the major pairs are slightly lower to about unchanged on the day. Although sentiment remains firm for the Greenback there are signs that the current rally is about to falter; the biggest indicator is low volume in my view. Most pairs had a flurry of activity early ahead of the London fix but have since slowed down measurably from early order flows. Cable is holding firm around the 1.8650 area after making a run for lows but was unable to test the overnight Asia lows still in place at 1.8624; a late rally was turned back from the 1.8680 area and the rate remains steady in the middle of the range. Forex Traders report the GBP is still tracking EURO higher and lower but the EURO remaining firm at the 1.4700 area after a brief spike to fresh New York highs at the 1.4730 area suggest the rate is possibly building for a short-squeeze. EURO has a load of news due tomorrow which is expected to be neutral-to-bearish for the rate so depending on how much downside the rate can manage overnight on the news will likely determine if a run for stops under the 1.4620 area is in store; if holding longs from this morning around the 1.4700 handle is fine for now. Tomorrow’s US data is likely to cause a bit of volatility as well so if the EURO can hold current lows after the news there is a good probability the rate will make a run for high stops likely in the 1.4750 area or higher by mid-week. USD/JPY was under pressure off the highs all day and made new lows for the day at 109.96 but saw a bit of bids show up to hold the 110.00 handle; traders note volumes were thin on the move making for potential volatility near-term. Look for the rate to find stops under the 109.20 area to be in size and a liquidating break to develop if the rate can’t score a new weekly high above the 110.60/70 area; OK to hold shorts for now as well. Loonie came off the lows for the day to trade higher as dropping oil prices continued to attract bids but the rate is showing signs of weakness in my view; OK to hold shorts with stops currently working. In my view, the USD is looking a little “toppy” today and if large bids don’t show up overnight or during the news the Greenback is looking vulnerable for a correction. Look for a quiet overnight session and possibly some follow-on selling to start Asia; the “buy the dip” crowd will likely support the USD overnight so expect some two-way action near-term.


GBP/USD Daily

Resistance 3: 1.8780
Resistance 2: 1.8750/60
Resistance 1: 1.8720/30
Latest New York: 1.8640
Support 1: 1.8620/30
Support 2: 1.8600
Support 3: 1.8580

Comments
Rate struggling to hold gains but is off the weekly low from last week; today’s open shows net bid follow-through but some weakness. Look for more upside this week. Possibly shorts covering ahead of the news due Tuesday. Rate bouncing off two-year lows and is an excellent buy in my view. Rate has likely flushed out every long now and shorts will likely take gains soon leaving the rate vulnerable to a sharp rally. Possible buying from semi-official names so watch the news. Offers above the market mixed with stops from late shorts so be ready for whipsaw the next few days. Traders expect GBP to track EURO through this week. Continue to expect a lot of cross-trading. Get ready for the rally.

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


EUR/USD Daily

Resistance 3: 1.4850
Resistance 2: 1.4820/30
Resistance 1: 1.4770/80
Latest New York: 1.4695
Support 1: 1.4670
Support 2: 1.4650/60
Support 3: 1.4620/30

Comments

Stops-driven sell-off scores new low last week but rate bounces smartly suggesting at least a small interest in bottoming. Failure to hold above the 1.4700 handle likely to draw in late shorts. Traders report large bids on the drop but volumes died later, lower oil pricing pressures prices all day. Traders report model/macro accounts continue selling the rate. Traders suggesting that the rate is vulnerable to a short squeeze. Market is heavily short now so expect a rally. Larger names buying last week traders say. Likely the rate has flushed all longs. Aggressive traders can buy this dip for a return to resistance. Rate continues to track Cable and vice-versa. Now that stops are cleared a rotation higher is coming. US data this week likely to be unfriendly so be ready for whipsaw.

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

2:00am EUR German PPI m/m
5:00am EUR German ZEW Economic Sentiment
5:00am EUR ZEW Economic Sentiment


Join us for the Afternoon US Dollar Wrap-Up daily at 3:15 pm Central/Chicago time (GMT -6)

Forex 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 finally weakens
• Volumes a bit lower
• US news no help

Overnight Preview

• Look for consolidation
• USD likely to have a weaker bias mid-week

Looking Ahead to Wednesday
All times EASTERN (-5 GMT)
• 10:35am USD Crude Oil Inventories
Another light day for the Greenback.

Summary
After showing subtle signs of topping the past few days the USD finally edged lower in thinner forex trade after the news was out this morning. Although the fundamental picture was a mixed bag with PPI rising and housing still weak the Greenback is not attracting substantial bids as we head into the close. Cable surprised to the upside printing fresh highs for the day at 1.8681 but has since retreated a bit and remains in positive territory. Headline estimates for UK inflation are on the rise and with the expectations for a BOE rate hike sooner rather than later and unless the USD can mount a formidable advance against the cross-spreaders it appears the GBP has bottomed for the month. Aggressive traders can look to buy any weakness the next 24 hours in my view. EURO found light close-in stops above the 1.4740/50 area for a high print at 1.4793 before falling back to hold the 1.4760/70 area; traders say offers for the “sell rallies” crowd were positioned ahead of 1.4800 with large stops above suggesting that if late sellers were in today a test of further offers is likely. German ZEW and PPI data out overnight were supportive of the rate and with light news due for the rest of the week the EURO is likely to trade technically with support now around the 1.4690 area and resistance at the 1.4800 handle. Expect stops from shorts to be rolled down closer to the market likely in the 1.4820 area; expect a short-squeeze to get rolling above that number if we trade there the next 24 hours or so. Market moving data will include Philly Fed on Thursday so between now and then if EURO can’t break back the upside will likely be the course of least resistance. USD/JPY probed for stops as did USD/CHF; both pairs finding some at 109.60 and 1.0950 respectively for low prints on the day at 109.54 and 1.0907. Traders expect more stops at 1.0900 in Swissy and 109.20 in USD/JPY; both numbers likely to trade overnight in my view. The toolbox executed an exponential reversal today so aggressive traders can sell any bounce in USD/CHF. Loonie continues to hold the 1.0600 handle on fears the government will be recalled in Ottawa but the strength is likely only near-term as the rest of the USD-complex is under threat today. Look for the USD to consolidate with a lower bias overnight.

GBP/USD Daily

Resistance 3: 1.8750
Resistance 2: 1.8700/10
Resistance 1: 1.8680
Latest New York: 1.8675
Support 1: 1.8520/30
Support 2: 1.8400
Support 3: 1.8370


Comments
Stopped out of longs overnight, rate holding above the lows and showing another large wick. Late highs driven by stops and some active buying; late shorts likely to roll stops close-in. Look for more upside this week. Possibly short covering ahead of the news due Tuesday; some of that may have contributed to the one-figure rally off the lows overnight. Rate bouncing off two-year lows and is an excellent buy in my view. Rate has likely flushed out every long now and shorts will likely take gains soon leaving the rate vulnerable to a sharp rally. Possible buying from semi-official names (Russians) so watch the news. Offers above the market mixed with stops from late shorts so be ready for whipsaw the next few days. Traders expect GBP to track EURO through this week. Continue to expect a lot of cross-trading. Get ready for the rally.

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

4:30am GBP MPC Meeting Minutes
4:30am GBP M4 Money Supply m/m
4:30am GBP Public Sector Net Borrowing
6:00am GBP CBI Industrial Trends Orders

EUR/USD Daily

Resistance 3: 1.4850
Resistance 2: 1.4820/30
Resistance 1: 1.4790/1.4800
Latest New York: 1.4791
Support 1: 1.4620/30
Support 2: 1.4600
Support 3: 1.4570/80

Comments
Another stop driven break under the 1.4650 area bought by Russian names traders say; better than expected German ZEW data helps the rate off the lows. Rally over the 1.4750 area likely included some short covering. Today’s US data caused some whipsaw but unable to make new lows. Traders report large bids on the drop but volumes died later. Traders report model/macro accounts continue selling the rate. Traders suggesting that the rate is vulnerable to a short squeeze. Market is heavily short now so expect a rally. Larger names buying last week traders say. Likely the rate has flushed all longs. Aggressive traders can buy this dip for a return to resistance. Rate continues to track Cable and vice-versa. Now that stops are cleared a rotation higher is coming. US data this week likely to be unfriendly so be ready for whipsaw.

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

Join us for the Afternoon US Dollar Wrap-Up daily at 3:15 pm Central/Chicago time (GMT -6)

Forex 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 Analysis

Today’s US Dollar Trading

• USD two-way, holds ranges
• Traders report light volumes on the drop
• Late selling drops USD lower

Overnight Preview

• USD likely to have two-way action overnight
• Should get quiet ahead of US data in the morning

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
Big day for news across the board; expect some potential whipsaw.


Summary
Despite a falling Oil market and a weak Gold market today, the USD was unable to extend gains again after a mid-day rally that looked like highs might score after the London fix. All the majors had rallied a bit ahead of light economic news and minor follow-on bids overnight that were turned back as the Greenback regained some poise and Equities moved higher. RHS interest in EURO at the London fix failed to provide downside pressure and heading into the end of the day the EURO is back on the offensive but still lower on the day. Forex trader’s note that the break into new lows on the day was on light volumes suggesting that the last group of late shorts has ponyed-up leaving the rate vulnerable to a rally the next 24-48 hours. Low prints were at 1.4671 and light stops reported under the lows of the day previous around the 1.4690 area suggesting that some early longs were wrong-footed. As Oil rallied back to positive territory taking EURO with it the other majors also saw a recovery from the lows seen earlier. Cable advanced back above the 1.8600 handle as shorts covered; traders note that cross-spreading for other sterling pairs helped to support the rate. Cable now has three solid buying wicks the past several sessions arguing for a near-term bottom around the 1.9560 area. USD/JPY regained the 110.00 handle for most of the day but as Equities fell off late the rate was pressured back to the lows but still holding the Asian low in the 109.60 area; traders report stops building under the 109.40 area with bids ahead suggesting some additional whipsaw is likely ahead of US data tomorrow. If the Asian session tonight finds follow-on selling a test of the 109.50 area is likely. Swissy attempted to regain the 1.1000 handle as well keeping the bears on the defense throughout the day but pressure from technical traders are keeping a lid on the rate despite lower Gold prices today. Look for the Swissy to test the lows around the 1.0920/30 area overnight as the top is well-defended above the 1.1000 area near-term. For the most part the USD is trapped in current near-term ranges and is likely to need some impetus to either rally or drop; in my view that will likely be tomorrow’s Philly Fed data but tonight is thick with news from our trading partners. Overnight action will likely include some whipsaw so I suggest not moving stops as long as they are out of range for the week. Look for a USD slide overnight and a test of lows before more two-way action.


GBP/USD Daily

Resistance 3: 1.8750
Resistance 2: 1.8700/10
Resistance 1: 1.8680
Latest New York: 1.8618
Support 1: 1.8520/30
Support 2: 1.8500
Support 3: 1.8480


Comments
Late rally shows solid bids coming in, rate holding above the lows and inside previous large wick. Bids expected during the day as shorts cover. Late highs driven by stops and some active buying; late shorts likely to roll stops close-in. Look for more upside this week. Rate bouncing off two-year lows and is an excellent buy in my view. Rate has likely flushed out every long now and shorts will likely take gains soon leaving the rate vulnerable to a sharp rally. Offers above the market mixed with stops from late shorts so be ready for whipsaw the next few days. Traders expect GBP to track EURO through this week. Continue to expect a lot of cross-trading. Get ready for the rally.

Data due Thursday: All times EASTERN (-5 GMT)
4:30am GBP Retail Sales m/m
4:30am GBP Prelim Business Investment q/q


EUR/USD Daily

Resistance 3: 1.4840/50
Resistance 2: 1.4800/10
Resistance 1: 1.4780
Latest New York: 1.4745
Support 1: 1.4670/80
Support 2: 1.4650
Support 3: 1.4620/30


Comments
New lows on light volume during the day, unable to extend losses. Stops on the way down at 1.4750 on Russian sales, support solid in my view at 1.4700 area; look for late shorts to bail on a move back over the 1.4780 area this week. Likely rolling stops lower to the 1.4800/20 area in size. Grind in two-way action is good but we want higher volumes on rallies to form this bottom. Some whipsaw possible but unable to make new lows so far this week. Traders report large bids on the drop but volumes died later. Traders suggesting that the rate is vulnerable to a short squeeze. Market is heavily short now so expect a rally. Larger names buying last week traders say. Likely the rate has flushed all longs. Aggressive traders can continue buying this dip for a return to resistance. Rate continues to track Cable and vice-versa. Now that stops are cleared a rotation higher is coming. US data this week likely to be unfriendly so be ready for whipsaw.

Data due Thursday: All times EASTERN (-5 GMT)
3:00am EUR French Flash Manufacturing PMI
3:00am EUR French Flash Services PMI
3:30am EUR German Flash Manufacturing PMI
3:30am EUR German Flash Services PMI
4:00am EUR Flash Manufacturing PMI
4:00am EUR Flash Services PMI

Join us for the Afternoon US Dollar Wrap-Up daily at 3:15 pm Central/Chicago time (GMT -6)

Forex 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 Analysis

Today’s US Dollar Trading

• The USD unable to hold gains in NY
• Volume a bit better than Friday, stops drive a lot of trade
• Oil pushes Greenback around as do equities

Overnight Preview

• Look for tow-way action overnight
• USD may be overextended to the upside so expect downside bias

Looking Ahead to Tuesday
All times EASTERN (-5 GMT)
• 9:00am USD S&P/CS Composite-20 HPI y/y
• 10:00am USD Consumer Confidence Index
• 10:00am USD New Home Sales
• 10:00am USD HPI m/m
• 10:00am USD Richmond Manufacturing Index
• 2:00pm USD FOMC Meeting Minutes

Summary
The USD is weaker against the majors to end New York after starting a bit better overnight Asia. Forex traders note that volumes were thin overnight and most of the day but once the USD began to move lower after the London fix the volumes increased a bit. The lack of economic news certainly helped with the thinner conditions and today’s Housing Data was no help for the USD bulls even though sales were better-than-expected; after an initial brief rally the USD fell to lows on the day after the release of the news. Cable rallied to a high print at 1.8592 making for a large range on the day and creating a hook reversal but gave back some of those gains to end near the 1.8520 area in slower trade. Earlier stops were under the 1.8500 and 1.8450 area for lows in Asia but professional buying was noted off the lows traders say suggesting that the near-term bottom is in for the rate. EURO fell and rallied in tandem with GBP today but remaining in a tighter range; low prints in Europe at 1.4695 were never challenged in New York and the rate rallied to make highs at 1.4809 before falling back to the 1.4750 area; stops have been triggered at the 1.4750 area on the rallies and on the dips suggesting that the 1.4750 area is the near-term pivot point. Aggressive traders can look to add to their open EURO longs the next 24 hours or so as the two-way action is likely to continue making dips under the 1.4750 area and above the 1.4690 area solid buying opportunities. USD/JPY found stops as expected on a break of the 109.40 area for a low print at 109.01 but the rate was able to recover a bit and close near the 109.30 area. Although the USD is lower and expected to make more lows should additional US data this week remain weak; the USD/JPY needs a significant move under the 108.00 handle for a monthly reversal to form. In my view, the Greenback will likely remain two-way the next several days providing a lot of opportunity for short-term traders. The recent rally in the USD is over-extended I think and a correction is overdue. Look for the USD to remain two-way overnight and into tomorrow’s data.

GBP/USD Daily

Resistance 3: 1.8720
Resistance 2: 1.8680
Resistance 1: 1.8620
Latest New York: 1.8515
Support 1: 1.8400/10
Support 2: 1.8350
Support 3: 1.8320

Comments
After all of today’s action the rate ends about where it started this morning after making highs later in the day. Rate falls to a new low overnight but volumes are thin due to the holiday; likely an exhaustion dip and the rate will recover soon. Hook Reversal on the day, look for a bottom the next 48 hours. OK to stand aside but I want to wait just a bit before buying. EURO holding firmer despite a lower open. So far suggesting GBP is overextended. Rumors of a Lehman Brother’s bailout from a Korean source may be blowing over. Close above the 1.8580 area argues for further gains; aggressive traders can buy the close but again I would wait just a bit. Stop-driven break is likely a head fake in my view. Offers above the market mixed with stops from late shorts so be ready for whipsaw the next few days. Traders expect GBP to track EURO through this week. Continue to expect a lot of cross-trading.
Data due Tuesday: All times EASTERN (-5 GMT)
4:30am GBP BBA Mortgage Approvals


EURO/USD Daily

Resistance 3: 1.4880/1.4900
Resistance 2: 1.4850
Resistance 1: 1.4800/10
Latest New York: 1.4748
Support 1: 1.4690/1.4700
Support 2: 1.4650
Support 3: 1.4620

Comments
Although rate is off the highs it is holding firm against the USD. If oil retreats expect a pullback but that is a buying opp in my view. Stops in the 1.4750 area cleared on the way lower but holding above there suggests a buy the dip mentality; next level is still above the 1.4900 handle most likely. Support solid in my view at 1.4700 area now; grind in two-way action is good but we want higher volumes on rallies to form this bottom. Traders suggesting that the rate is vulnerable to a short squeeze. Market is heavily short now so expect a rally. Aggressive traders can continue buying this dip for a return to resistance. Rate continues to track Cable and vice-versa. Now that stops are cleared a rotation higher is coming. US data this week likely to be unfriendly so be ready for whipsaw.
Data due Tuesday: All times EASTERN (-5 GMT)
2:00am EUR German Consumer Confidence
2:00am EUR German Final GDP q/q
4:00am EUR German Ifo Business Climate Index
4:00am EUR German Ifo Business Expectations Index

Join us for the Afternoon US Dollar Wrap-Up daily at 3:15 pm Central/Chicago time (GMT -6)

Forex 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 Analysis

Today’s US Dollar Trading

• USD fails to extend overnight strength
• Volumes better
• Stops close-in result in two-way action

Overnight Preview

• Look for more two-way action
• USD is getting “tired” I think

Looking Ahead to Wednesday
All times EASTERN (-4 GMT)
• 8:30am USD Core Durable Goods Orders m/m
• 8:30am USD Durable Goods Orders m/m
• 10:35am USD Crude Oil Inventories

Summary
To finish today the USD is off its highs against all pairs but still in positive territory against EURO and GBP; Forex traders note that volumes were better today but that might have been due to Oil’s wild ride pulling in smaller day-trading type accounts. Volatility was high earlier when the majors made highs against the USD in the New York session but all the pairs are finishing more in the mid-range making today’s trade a bit more inconclusive. Sentiment is still favoring the USD near-term and with a lighter calendar to end the week the potential for continued two-way trade is higher. As discussed yesterday, short-term accounts have had a lot more opportunity while the longer position accounts have had to hold through whipsaw. EURO is lower and unable to hold the 1.4700 handle after a try earlier in the day; traders note that technicians are expecting a further drop into the low 1.4500 handle soon but in my view, that would be a buying signal. Shorts were seen liquidating on the break and should further declines be in the works look for low-volume drops followed by higher volume rallies soon. Tomorrow’s Oil inventory data likely to cause a bit of volatility in that market which will likely spillover into EURO and GBP. Cable was also unable to hold the 1.8400 handle on the earlier recovery making for a bit more challenging trade in that pair from the long side. Today’s FOMC minutes late in the day was little help for the GBP bulls as a recovery in that pair needs a steady-to-dovish Fed policy and no hints of that were seen in the minutes. USD/JPY continues to grind sideways and under resistance after failing at the highs again today; stops as expected were seen on the dip into New York lows on the day but bids supported at the same previous level making for another round of two-way trade. USD/CAD is looking weaker and lows at 1.0410 are just shy of the reported large stops under the 1.0400 handle. Tomorrow’s Durables data may be enough to drop that rate into stops but the recovery back to the mid-1.04’s shows the bulls are still trying to take control after the large drop last week. In my view, it’s another day of business as usual making the USD bulls a bit more bold. If there is no upside follow-through on durables tomorrow the highs for the week may be in and a correction in the majors can continue.


GBP/USD Daily

Resistance 3: 1.8650
Resistance 2: 1.8600
Resistance 1: 1.8530
Latest New York: 1.8391
Support 1: 1.8320
Support 2: 1.8290/1.8300
Support 3: 1.8250

Comments
Big drop in sympathy with EURO, negates hook reversal and stops drive trade. Finishes better than the open so there is some bid interest coming in. Drop is drawing profit-taking bids suggesting the bottom is finally finding a low print. Overdue for a short-covering rally. Likely an exhaustion dip and the rate will recover soon. Look for a bottom the next 48 hours. OK to stand aside but I want to wait just a bit before buying. EURO dropping forced rate into stops traders agree. So far suggesting GBP is overextended. Close back above the 1.8580 area argues for further gains; aggressive traders can buy the close but again I would wait just a bit. Stop-driven break is likely a head fake in my view. Offers above the market mixed with stops from late shorts so be ready for whipsaw the next few days. Traders expect GBP to track EURO through this week. Continue to expect a lot of cross-trading.

Data due Wednesday: All times EASTERN (-4 GMT)


EURO/USD Daily

Resistance 3: 1.4880/1.4900
Resistance 2: 1.4800
Resistance 1: 1.4760
Latest New York: 1.4648
Support 1: 1.4570
Support 2: 1.4550
Support 3: 1.4520/30

Comments
Rate falls into stops layered close in and accelerates on thinner volumes. Low prints from active selling at 1.4570; rate makes a six-month low and traders report profit-taking bids. Oil retreats also helping to pressure rate, this is a buying opp in my view but we need to wait 24 hours. Traders suggesting that the rate is vulnerable to a short squeeze. Market is heavily short now so expect a rally. Aggressive traders can continue buying this dip for a return to resistance. Rate continues to track Cable and vice-versa. Now that stops are cleared a rotation higher is coming. US data this week likely to be unfriendly so be ready for whipsaw.
Data due Wednesday: All times EASTERN (-4 GMT)
2:00am EUR German Import Prices m/m
All Day EUR German Prelim CPI m/m

Join us for the Afternoon US Dollar Wrap-Up daily at 3:15 pm Central/Chicago time (GMT -6)
Forex 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 whipsaws with conflicting data
• Traders note volumes thin again
• US data inconclusive

Overnight Preview

• Look for more two-way action
• Should get quiet ahead of US data in the morning

Looking Ahead to Thursday
All times EASTERN (-4 GMT)
• 8:30am USD Prelim GDP q/q
• 8:30am USD Unemployment Claims
• 8:30am USD Prelim GDP Price Index q/q
• 10:35am USD Natural Gas Storage
Big day for news with our trading partners, expect some whipsaw.


Summary
The Greenback suffered another day of whipsaw today failing to extend recent ranges in thin trade. For the most part, USD traders are looking ahead to more conclusive news due overnight and tomorrow from both our trading partners and here in the US. After failing at highs overnight, the USD managed to recover and try for new highs in most pairs but failing to reach into the zones of reported stops to the upside while traders watched for news on other markets; such as oil and equities. Oil prices managed to whip EURO around making new lows for the US session but failing to reach into real money interest under the 1.4600 handle; overnight lows continued to remain unchallenged in US trade. Holding the 1.4700 area into the close is encouraging to the bulls but the big news will be US GDP tomorrow; traders are looking for a revision upwards but likely will wait for a test of the 1.4600 handle before making a move. GBP continued under pressure with EURO for most of the session moving under the 1.8400 handle to test the low 1.8300’s but volumes are thin traders say. A brief look under the 1.8300 area for a low print at 1.8283 was enough for stops to be triggered but the rate is back in the 1.8330 area into the close suggesting that bids are there but light so far. USD/JPY failed to rally and hold the 110.00 handle again for the 7th day in a row suggesting that offers remain thick at the highs; trades note that tonight’s Japan data may encourage more volatility. Swissy rallied again into the 1.1000 handle but failed late in the day suggesting that offers are thick in that pair also. Aggressive traders can sell above the 1.0980 area for a break lower to end the week. USD/CAD rallied as well but again was unable to attract bids and remained mired in the 1.0400 handle under the zone of offers said to extend into the 1.0530 area for now. In my view, today was just another day of two-way action with the exception of the GBP; look for the USD to fail again overnight and test the bottom of the range ahead of US data in the morning.


GBP/USD Daily

Resistance 3: 1.8650
Resistance 2: 1.8600
Resistance 1: 1.8530
Latest New York: 1.8349
Support 1: 1.8280/90
Support 2: 1.8250
Support 3: 1.8220


Comments
Only pair to fall to a new low but volumes light on the move suggesting overshoot. Rally back in sympathy with EURO. Overnight volumes better traders say; cross-spreaders active in Sterling and EURO suggesting that the USD will be pressured for both pairs near-term. Drop is drawing profit-taking bids suggesting the bottom is finally finding a low print. Overdue for a short-covering rally. Likely an exhaustion dip and the rate will recover soon. Look for a bottom the next 48 hours. OK to stand aside but I want to wait just a bit before buying. So far, two-way trade is suggesting GBP is overextended. Close back above the 1.8580 area argues for further gains; aggressive traders can buy the close but again I would wait just a bit. Stop-driven break is likely a head fake in my view. Offers above the market mixed with stops from late shorts so be ready for whipsaw the next few days. Traders expect GBP to track EURO through this week. Continue to expect a lot of cross-trading.
Data due Thursday: All times EASTERN (-4 GMT)

2:00am GBP Nationwide HPI m/m
6:00am GBP CBI Distributive Trades Realized
7:01pm GBP GfK Consumer Confidence

EUR/USD Daily

Resistance 3: 1.4880/1.4900
Resistance 2: 1.4800
Resistance 1: 1.4760/70
Latest New York: 1.4723
Support 1: 1.4570
Support 2: 1.4550
Support 3: 1.4520/30

Comments
Rate bounces back as close-in stops drive trade; remarks from ECB encourage a round of short-covering. If rate can hold above the 1.4750 area on the close good chance of follow-on buying to end the week. EX reversal overnight suggest tie to buy a new dip under the 1.4700 handle (?). Oil firmer likely to help upside, this is a buying opp in my view but we need to wait through US data this morning. Traders suggesting that the rate is vulnerable to a short squeeze. Market is heavily short now so expect a rally. Aggressive traders can continue buying this dip for a return to resistance. Rate continues to track Cable and vice-versa. Now that stops are cleared a rotation higher is coming. US data this week likely to be unfriendly so be ready for whipsaw.

Data due Thursday: All times EASTERN (-4 GMT)
3:55am EUR German Unemployment Change
4:00am EUR M3 Money Supply y/y
Join us for the Afternoon US Dollar Wrap-Up daily at 3:15 pm Central/Chicago time (GMT -6)

Analysis Provided by: Forexpros.com - Written by Jason Van 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