EUR/USD Technical Analysis August 8, 2011

The EUR/USD pair rose on Friday as traders dumped the USD around the markets. The pair stopped short of the 1.4350 area. The pair has been very volatile, and as such hasn’t been one of our favorite pairs to trade. The Euro has an almost uncountable amount of issues behind it, and because of this we won’t buy this pair. If we get a nice sell signal at either 1.4350 or 1.45 – we will not hesitate to do so.

USD/JPY Technical Analysis August 8, 2011

The USD/JPY pair fell on Friday as traders sold the Dollar off in the US session. The pair is decidedly bearish, but let us not forget that the Bank of Japan intervened recently. The pair is dangerous to short, as the BoJ has stated publicly that they are talking to other central banks to help with another intervention. This pair could be bought – but we need a supportive candle to do so.

GBP/USD Technical Analysis August 8, 2011

The GBP/USD pair rose on Friday, as the Non-Farm Payroll numbers came out with an addition of 117,000 jobs in July. The market seems to be stuck in a range between 1.62 and 1.65, and as such, we feel that the market will stay in that range. Because of this, the market being at roughly 1.6380 tells us that we will more than likely get a shorting chance soon. We look to sell weakness near 1.65 on a weak candle.

USD/CHF Technical Analysis August 8, 2011

The USD/CHF pair had a wild day during the Friday session, but eventually ended up fairly unchanged in the end. The pair is a “sell only” pair as far as we are concerned, and as such are waiting to see one of two things: Either a break of the Friday lows in order to get short or a bounce to 0.80 in order to sell. We will not buy this pair as the trend is far too strong to fight.

EUR/CHF Technical Analysis August 8, 2011

The EUR/CHF pair rose on Friday, and fell just short of the 1.10 area at the end of the session. The pair is decidedly weak, and the area has produced reactions lately – so we are paying attention to the shorter-time frame charts in order to get a sell signal. The pair certainly wants to fall, but the current volatility in the markets makes the timing important. We look for weakness near 1.10 and sell if we get the signal. We will not buy this pair under any circumstances.

AUD/USD Technical Analysis August 8, 2011

The AUD/USD had a fairly flat day in the markets as the day ended up almost unchanged on Friday. The low on Friday ended up being a fresh lower low, and that tells us that more than likely we will see lower prices in the future. The trading signal would be a break below the low on Friday. However, the highs being broken to the upside could send this pair upward for a bounce. That bounce would more than likely be sold by traders as the new low makes it obvious that the pair wants to fall over the long run.

USD/CAD Technical Analysis August 8, 2011

The USD/CAD pair finished the day fairly flat after rising, falling, and generally chopping the market back and forth. The day in the oil markets was very wild as well, and this would certainly have an effect on the Loonie. The 0.98 resistance area has held again and a break of the Friday lows wouldn’t be a bad entry signal for a sell position. We don’t like buying this pair, so we will only look for this signal.

NZD/USD Technical Analysis August 8, 2011

The NZD/USD pair rose on Friday, and even got high enough to retest the 0.85 mark. This former support turning into resistance is common, and we welcome this sign as it shows that the pair might be ready to fall again. We are looking for a weak candle in the area to sell. If we get a daily close above the area – we will then buy. 0.85 is the key to the future direction of this pair.

EUR/USD Technical Analysis for the Week of August 8, 2011

The EUR/USD had a fairly wild week as traders sold off, and then bought the Euro as the situation in the EU plays out. The pair does however look a bit like a flag, and as such – we think that there is actually a scenario where this pair goes higher over the long run. However, with all of the headline risk in this pair, we don’t like owning the Euro, and aren’t necessarily found of the Dollar as well. If we break the 1.45 area on a close – this would be the signal to buy. If we break the 1.40 area to the downside, this pair falls.

USD/JPY Technical Analysis for the Week of August 8, 2011

The USD/JPY pair saw intervention by the Bank of Japan this past week, but quickly gave up a lot of the gains from that action. The pair is certainly bearish, but with the BoJ talking openly to other central banks for a helping hand, one has to think that the eventuality of a coordinated intervention is a major reason to avoid shorting this pair. A long could be taken, but only if you are willing to sit on this trade for a very, very long time.

GBP/USD Technical Analysis for the Week of August 8, 2011

The GBP/USD pair fell this past week, but then rose again as traders bought the Pound. The weekly candle looks like a hammer, and could signal a move to the upside. However, we want to see a break of the 1.65 in order to go long for a long-term trade. In the meantime, this pair looks like it will consolidate.

USD/CHF Technical Analysis for the Week of August 8, 2011

The USD/CHF pair fell hard this past week, and has decidedly increased the bearish pressure. The pair has fallen past the 0.76 mark, and we like selling it because of the almost one-way nature of this pair. The pair could bounce however, and if it does – we will be here to sell. A bounce to 0.80 would be very welcome for this. A fresh new low could also trigger more selling as well.

EUR/CHF Technical Analysis for the Week of August 8, 2011

The EUR/CHF pair fell again this past week as the trading world worries about European debt once again. The pair is a safe haven play, and as such gets piled into on the short side every time bad economic news comes out. The EU is a dangerous place to be invested in at the moment, and the relative safety of Switzerland is appealing to traders. The 1.10 – 1.12 area should cause a reaction, and if it doesn’t – the 1.15 will almost certainly do it. We still like selling rallies – and this won’t change anytime soon.

 

AUD/USD Technical Analysis for the Week of August 8, 2011

The AUD/USD pair fell extremely hard this past week as traders shed anything remotely related to the “risk on” trade. The pair is currently sitting at the 1.04 – 1.05 support area. The pair would become a sell if we can break below the lows of this past week. The pair will find more support at 1.02, so this trade could be short-lived. If we bounce from here, it would be a nervous move as these kinds of falls generally don’t happen in a vacuum.

USD/CAD Technical Analysis for the Week of August 8, 2011

The USD/CAD pair had a screamer of a week as the pair shot straight up. It has stalled at the 0.98 level however, and as such – we could see a move down in the near-term. The 0.99 area is even stronger resistance, and we think we may see an attempt to push price up to that level. None-the-less, we think of the USD/CAD pair as a “sell only” pair, and will only sell signs of weakness. Unfortunately, we are not seeing that at the moment.

NZD/USD Technical Analysis for the Week of August 8, 2011

NZD/USD fell hard this past week, and even managed to break through the 0.85 support line. The pair suddenly doesn’t look as strong as it has, but the real battleground will be at the 0.85 level as we have bounced back towards it. The pair so far is still in an uptrend, but if the 0.85 level holds as resistance – this pair goes down. If we can get a daily close above that level, there is a case to buy.

USD/JPY Weekly Fundamental Analysis for August 08-12, 2011

The USD/JPY pair rallied last week, after the BOJ intervened in the FX market to sell the yen after it reached to critical levels against the dollar. While the Bank of Japan kept the interest rate steady at their lowest level to provide more liquidity to financial markets.

The Japanese Finance Ministry unilaterally intervened in the foreign exchange market selling the Japanese yen, while the BOJ kept the interest rate steady near zero and indicated that the current volatility in the FOREX market hammer the Japanese recovery.

Bank of Japan expanded its asset-purchase fund by 5 trillion yen, in addition to increasing the lending program by another 5 trillion yen, aiming to pump more liquidity into financial markets.

Despite the new debt plan lunched by the U.S. lawmakers, the higher yielding currencies retreated on concerns that the U.S. economy is still on the edge of another credit downgrade.

On the other hand, the global stock markets dropped sharply on concerns about the outlook for the global economic recovery, where investors are looking for safer investments, which could bring the Japanese yen higher once again.

Major highlights for this week that will affect the USD/JPY pair’s trading:

Monday August 08:

On Monday at 23:50 GMT (Sunday),Japanwill release the current account total for June, where the previous reading showed a surplus of 590.7 billion yen, while it’s expected to show a surplus of 652.8 billion yen.

The adjusted current account total for June is expected to show a surplus of 961.1 billion yen from the previous surplus of 391.0 billion. On the other hand, the trade balance for June is predicted to show a surplus of 113.1 billion from the prior deficit of 772.7 billion.

At 05:00 GMT, Japan will release the Eco Watchers Survey: Current for July, where the previous reading was 49.6 and expected to come at 50.0, while the Eco Watchers Survey: Outlook had a prior reading of 49.6.

Tuesday August 09:

On Tuesday at 05:00 GMT Japan will release the consumer confidence for July, where the previous reading was 35.3 and expected to come at 37.0.

TheU.S.economy will issue the unit labor coast for the second quarter at 12:30 GMT, where the preliminary reading is expected to show a rise of 2.3% from the previous 0.7%. While the non-farm productivity for the second quarter is expected to decline by 0.8% from the prior rise of 1.8%.

At 18:15 GMT, the Federal Reserve Bank Open Market Committee rate decision, where all eyes will be focused on the central bank statement as they are expected to keep rates steady at 0.0-0.25%.

Wednesday August 10:

On Wednesday at 23:50 GMT (Tuesday), the Bank of Japan will publish the minutes for July 11-12 meeting.

The Tertiary industry index for June will be released at 23:50 GMT, and expected to show a rise of 1.0% from the previous rise of 0.9%.

At 14:00 GMT, theU.S.economy will release the wholesale inventories for June, where the previous reading was 1.8% and expected to retreat to 1.0%. The monthly budget statement for July will be released at 18:00 GMT, where the previous reading showed a deficit of $43.1 billion and expected to widen to a deficit of $140.0 billion.

Thursday August 11:

On Thursday at 23:50 GMT (Wednesday), Japan will release the machine orders for June, where the prior reading was 3.0% and expected to come at 1.8%, as for the annual reading it’s predicted to come at 11.3 from the previous 10.5%.

The U.S. trade balance for June will be released at 12:30 GMT, where it’s expected to show a deficit of $47.5 billion from the previous deficit of $50.2 billion.

At 12:30 GMT, U.S. economy will issue its weekly initial claims numbers, where the number of people filing for first-time claims for state unemployment insurance increased 400 thousand last week.

Friday August 12:

On Friday at 04:30 GMT,Japanwill release the industrial production for June, where the previous reading was 3.9%, as for the annual reading it had a prior reading of – 1.6%.

At 12:30 GMT, the U.S. economy will release the advanced retail sales for July, where the previous reading was 0.1% and expected to come at 0.4%. The University of Michigan confidence for August will be released at 09:55 GMT, where the preliminary reading is expected to come at 63.2 from the previous of 63.7.

The U.S. business inventories for June will be released at 10:00 GMT, where it had a previous of 1.0% and expected to come at 0.6%.

NZD/USD Weekly Fundamental Analysis for August 08-12, 2011

The European debt crisis is still worsening with the speculation that Italy and Spain will be the next victims to fall. Fears are escalating which is a negative impact on the markets movement, where Italian and Spanish 10-year governments bonds plummet.

The New Zealand dollar held its appreciations against its major counterpart the dollar after the New Zealand economy reported that unemployment declined to 6.5% during the second quarter.

The New Zealand currency slumped to the lowest level in three weeks, affected by the dire outlook for the global recovery, while started its sharp downside movement after the Standard & Poor’s 500 posted its biggest loss since February 2009.

In the week ahead, the New Zealand dollar is expected to get a boost from the manufacturing sector improvement, adding that there are positive signs for the economic recovery in New Zealand.

Major highlights for this week that will affect the NZD/USD pair’s trading

Monday August 08:

Both countries won’t release any fundamentals on Monday leaving the movement on the back of the prevailing sentiment and affected by their performance mainly versus other currencies.

Tuesday August 09:

TheU.S.economy will issue the unit labor coast for the second quarter at 12:30 GMT, where the preliminary reading is expected to show a rise of 2.3% from the previous 0.7%. While the non-farm productivity for the second quarter is expected to decline by 0.8% from the prior rise of 1.8%.

At 18:15 GMT, the Federal Reserve Bank Open Market Committee rate decision, where all eyes will be focused on the central bank statement as they are expected to keep rates steady at 0.0-0.25%.

Wednesday August 10:

At 22.4 GMT (Tuesday) the New Zealand economy is to start by the NZ card spending for July, while it inclined by 0.8% in June.

At 14:00 GMT, theU.S.economy will release the wholesale inventories for June, where the previous reading was 1.8% and expected to retreat to 1.0%. The monthly budget statement for July will be released at 18:00 GMT, where the previous reading showed a deficit of $43.1 billion and expected to widen to a deficit of $140.0 billion.

Thursday August 11:

At 23:30 GMT (Wednesday) New Zealand will release the business performance of manufacturing index for July, and the prior reading was 54.3 in June.

Moreover, the New Zealand consumer confidence index for August is due at 01:00 GMT following a drop of 2.3.

The U.S. trade balance for June will be released at 12:30 GMT, where it’s expected to show a deficit of $47.5 billion from the previous deficit of $50.2 billion.

At 12:30 GMT, U.S. economy will issue its weekly initial claims numbers, where the number of people filing for first-time claims for state unemployment insurance increased 400 thousand last week.

Friday August 12:

At 22:45 GMT, NZD retail sales Ex. inflation for the second quarter is due after the recorded 0.9% in the first quarter.

At 12:30 GMT, the U.S. economy will release the advanced retail sales for July, where the previous reading was 0.1% and expected to come at 0.4%. The University of Michigan confidence for August will be released at 09:55 GMT, where the preliminary reading is expected to come at 63.2 from the previous of 63.7.

The U.S. business inventories for June will be released at 10:00 GMT, where it had a previous of 1.0% and expected to come at 0.6%.

GBP/USD Weekly Fundamental Analysis for August 8 – 12, 2011

The GBP/USD moved to the downside in the week ended August 5 after rising over the past three weeks as the S&P warning that the U.S. still may lose its top credit rating, record-high rise in Italian and Spanish bond yields and slowdown in global growth made the dollar more favorite for investors as a safe haven currency.

The tensions spreading in markets eroded demand on high-yielding currencies. In addition, the BoE left interest rate and APF unchanged, in line with market expectations, which increased predictions the BoE would leave loose monetary policy probably for next year to boost recovery that started to wane as seen by the most recent data which made expectations in favor of increase in APF rather than a rise in interest rate.

In theU.S., the situation is not better, as the world’s largest economy is receiving warnings from rating agencies that the AAA top rating is at risk, while the latest data also referred to a slowdown in growth which increased speculations the Fed will announce a third round of stimulus to reinvigorate the economy.

However, the non-farm payrolls report showed improvement as theU.S.economy added 117,000 jobs in July from 46,000 in June while unemployment slipped to 9.1% from 9.2%.

This week, eyes will be on the BoE minutes to know whether there is a change in the nine-panel members point of view after the latest data released, where the bank will determine September’s rate decision according to the latest growth and inflation forecasts due this week in August’s inflation report.

On the other hand, the main focus in theU.S.will be the on the FOMC rate decision which is, however, predicted to witness no change in the Fed’s monetary stance.

The release of the data this week will be as follows:

Monday August 8:

Both economies lack economic fundamentals which propose that there would be calm trading on the pair which is predicted to follow the general trend in market as it will not able to get direction from data.

Tuesday August 9:

As of 08:30 GMT, theU.K.will release important data; manufacturing production for June is predicted to retreat to 0.2% from 1.8%, while visible trade deficit is estimated to narrow to 8100 million pounds from 8478 million pounds.

In the U.S., eyes will be on the FOMC rate decision , due 18:15 GMT, in case of any surprise from the Fed may announce a third round of stimulus to reinvigorate growth that started to slowdown after the end of QE2 in June, especially after the monetary interventions seen last week by the SNB, BoJ and ECB. Yet expectation refer to no change on monetary policy as the Fed will probably keep interest rate unchanged and will not announce new stimulus.

Wednesday August 10:

The awaited inflation report will be available at 09:30 GMT; thereafter, theUSwill release MBA mortgage applications for August 5 at 11:00 GMT followed by monthly budget statement at 18:00 GMT.

Thursday August 11:

At 12:30 GMT, the U.S economy will release trade balance report which is expected to show a narrowed deficit of $47.5 billion in June from $50.2 billion deficit a month earlier. At the same time, initial jobless claims for the week ended August 5 and continuing claims for the week ended July 30 will be available, while theU.K.lacks fundamentals.

Friday August 12:

The week ends with the release of some fundamentals from the U.S. which are retail sales for July, University of Michigan confidence for August and business inventories for June at 12:30 GMT, 13:55 GMT and 14:00 GMT respectively, while the U.K. lacks fundamentals.

USD/CHF Weekly Fundamental Analysis for August 8 – 12, 2011

The USD/CHF continued its original southern journey in the week ended August 5 as worries in markets enhanced demand on the Swiss franc as favorable safe haven, where the Swiss National Bank (SNB) borrowing cost cut could not change the direction to the upside on the weekly charts.

With the S&P warning that theU.S.may still lose its top credit rating, record-high rise in Italian and Spanish bond yields and slowdown in global growth in addition to the improvement in the Swiss economy, the franc remained the most attractive refuge, especially after the intervention of the BoJ in the FX market through selling the yen.

The SNB unexpectedly cut the three-month Libor interbank rate to a range between 0.00-0.25 percent compared with the prior 0.00-0.75 percent range. Also, the SNB said it would increase the supply of francs in the market over the next few days to halt the franc’s rise which is deemed as overvalued according to the SNB which pledged to use further measures if necessary. The impact of the decision did not last long as investors continued to resort to the franc amid the worries prevailing in markets.

Regarding the main highlight of the previous week, the non-farm payrolls report showed improvement as theU.S.economy added 117,000 jobs in July from 46,000 in June while unemployment slipped to 9.1% from 9.2%.

The outlook for the pair is bullish as the monetary measures announced by the SNB are predicted to take its effect in the coming period, especially after the SNB President Philipp Hildebrand announcement that the bank will adopt all “effective measures” to halt the franc’s appreciation.

This week, the spotlight will be on unemployment from the Swiss economy, where the main focus in theU.S.will be the FOMC rate decision.

The Fed is predicted to keep interest rate at its low level between 0.00% and 0.25% in August to boost recovery that started to wane as seen by the most recent data, where there are talks that the U.S. is in a need of a third round stimulus.

For this week, the release of the data will be as follows:

Monday August 8:

As of 05:15 GMT, the Swiss economy will release its only data for the week which is unemployment for July with expectations referring to steadiness in the seasonally adjusted reading at 3.0%. On the other hand, the U.S.has no releases.

Tuesday August 9:

Eyes will be on the FOMC rate decision , due 18:15 GMT, in case of any surprise from the Fed may announce a third round of stimulus to reinvigorate growth that started to slowdown after the end of QE2 in June, especially after the monetary interventions seen last week by the SNB, BoJ and ECB. Yet expectation refer to no change on monetary policy as the Fed will probably keep interest rate unchanged and will not announce new stimulus.

Wednesday August 10:

TheUSwill release MBA mortgage applications for August 5 at 11:00 GMT followed by monthly budget statement at 18:00 GMT.

Thursday August 11:

At 12:30 GMT, the U.S economy will release trade balance which is expected to show a narrowed deficit of $47.5 billion in June from $50.2 billion deficit a month earlier. At the same time, initial jobless claims for the week ended August 5 and continuing claims for the week ended July 30 will be available.

Friday August 12:

The week ends with the release of some fundamentals from theU.S.which are retail sales for July,UniversityofMichiganconfidence for August and business inventories for June at 12:30 GMT, 13:55 GMT and 14:00 GMT respectively.