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Wednesday, 15 Sep 2010

Yen Reaches 15-Year High

The Yen rose to a 15- year high against the dollar on Tuesday after Japan's prime ‎minister won a ruling party leadership vote, reducing the chances Japanese authorities ‎would attempt to stem yen gains. The USD/JPY fell as low as 82.91, its lowest level ‎since mid-1995.‎

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Weekly Trenddowndowndowndownupdown

Economic News

USD - Dollar Drops against the Majors

The U.S. dollar fell against most of its major currencies on Tuesday, touching a 15-‎year low below 83 yen as a break of technical support levels in several currency pairs ‎sparked a stampede out of the greenback. Also the AUD/USD pair rose as high as ‎‎0.9456, its highest level since July 2008 before correcting itself. Currently the pair is ‎trading around the 0.9370 level.‎

The significant break came in late morning New York trade on market talk that ‎Goldman Sachs said in a research note that while it suspects the Federal Reserve will ‎ratchet down growth forecasts, the revision is unlikely to be enough to spark ‎additional easing.‎

Another leading indicator released yesterday was U.S. Core Retail Sales. This number ‎handedly beat last month's results but failed to provide strength to the Dollar as ‎investors may be waiting for key data due to be released today to implement their ‎trading strategies.‎

Looking ahead today, the two main news events that may have a very large impact on ‎the Dollar and its main currency pairs are the Industrial Production and Crude Oil ‎Inventories at 13:15 GMT and 14:30 GMT respectively. These reports are very ‎important and are likely to impact dollar volatility. Traders should pay close attention ‎to the market as there is an opportunity to capitalize on the fluctuations which are ‎likely to follow this release.‎

EUR - EUR Traded Near One-Month High against Dollar

The EUR strengthened against most of its major counterparts yesterday, continuing to ‎prove that for the time being the euro is the solid currency that traders can rely on to ‎provide them with steady profits. The 16-nation currency extended gains versus the ‎USD on Tuesday, to close at around 1.2980 amid a broad sell-off in the U.S. dollar. ‎

The euro experienced similar behavior against the JPY and closed at 109.90.‎
The euro's advance began after U.S. retail sales rose more than ‎expected in August, ‎notching the largest gain in 5-months. Once the euro broke above ‎‎$1.2920-30 area, the ‎level that was the top of the range since August, it kept going to a ‎one-month high of ‎‎$1.3033. The move may be accelerated, as ‎being at parity was a key technical point ‎which may encourage more selling of dollars, ‎analysts said. ‎

In addition, the single currency, which slid below $1.19 in June on euro-zone debt ‎trouble, has since risen by more than 8% after smooth government debt auctions in ‎Greece, Portugal, Spain and Ireland eased concerns.‎

JPY - Yen at 15-Years High vs. Dollar

The yen rose to a 15- year high against the dollar on Tuesday after Japan's prime ‎minister won a ruling party leadership vote, reducing the chances Japanese authorities ‎would attempt to stem yen gains. The USD/JPY fell as low as 82.91, its lowest level ‎since mid-1995 before correcting itself. Currently the pair is trading around the 84.60 ‎level.‎

The yen has gained more than 10% against the dollar this year as recent weak U.S. ‎data and record low bond yields drove money away from U.S. assets.‎

Investors worry over a recent rise in the JPY as it makes Japanese products less ‎competitive abroad and hurts the value of overseas sales when translated back into the ‎Japanese currency. With steady gains primarily against the dollar, much of the yen's ‎bullish movement could be contributed to the repatriation of overseas earnings by ‎Japanese companies into the local economy. This has had a positive effect on major ‎JPY currency pairings, as the rising turmoil in the market is leading to greater ‎investment in the Japanese currency.‎

Oil - Traders Await Crude Oil Inventory Report

Oil settled below $77 a barrel Tuesday as the stock market swung between losses and ‎gains on mixed economic news. After a run-up from $72 a barrel at the end of August, ‎crude oil has again slowed its advance, mainly on concerns about the strength of the ‎global economy. While positive news on China's economy has tended to push prices ‎up, data from the U.S. and Europe has been a mixed bag, keeping a lid on price ‎increases.‎

Today, the release of the crude oil inventory report is likely to help determine the ‎market's next direction for black gold. Moreover, a release of a string of positive ‎economic figures from U.S. could help its bullishness. Therefore, traders are advised ‎now to make some profits as the price of crude oil is set to remain volatile in the short ‎term.‎

Technical News


There appears to be a bullish cross on the hourly chart's Slow Stochastic for this pair, ‎indicating an upward correction may be imminent. The recent bullish cross on the ‎daily chart's Slow Stochastic supports this notion. Going long might not be a bad idea ‎today.‎


The price of this pair appears to be floating in the over-sold territory on the RSI of ‎both the hourly and daily charts, indicating that we could see an upward correction in ‎the nearest future. The bullish cross on the hourly chart's Slow Stochastic supports this ‎notion. Going long might be a good strategy today


After yesterday's volatile price movements, this pair appears to have temporarily ‎calmed down. The price appears to be floating in neutral territory on most oscillators ‎and momentum appears to be showing a flat price movement. Waiting for a clearer ‎signal might be the right choice today


The Bollinger Bands on the hourly and daily charts appear to be tightening in ‎anticipation of a volatile movement. With the recent bullish cross on the 4-hour chart's ‎Slow Stochastic oscillator, the impending movement may be a downward correction. ‎Going long with tight stops might be the right choice today

The Wild Card


The continuous upward trend in this commodity appears to be running out of steam ‎lately. The highs of the upswings have begun to diminish in size and the longer-term ‎oscillators are beginning indicate an imminent correction. There appears to be a bearish ‎cross on the daily chart's Slow Stochastic, and the weekly Momentum oscillator has ‎turned downwards. ‎ Forex traders have a great opportunity to enter this possible trend ‎reversal at a fantastic price and capture the impending price swing.

Current Time: 11/30 07:37 GMT
# Time $€£¥ Event Per. Prev. Fore. Act. Imp.
06:00JPY+ Housing Startsy/y2.6%--2.5%1
09:00CHF+ KOF Economic Barometer99.8100.33
10:30GBP+ Net Lending to Individualsm/m4.9B4.8B-3
10:30GBP+ M4 Money Supplym/m-1.0%-0.2%-1
10:30GBP+ Mortgage Approvals69K70K-1
11:00EUR+ Italian Prelim CPI m/m0.2%-0.2%-1
14:30CAD+ Current Account-17.4B -15.2B-3
15:45USD+ Chicago PMI56.254.3-3
16:00USD+ Pending Home Salesm/m-2.3%1.6%-3
22:45NZD+ Overseas Trade Index q/q1.3%-2.5%-1
23:30AUD+ AIG Manufacturing Index50.2--1
USD+ Total Vehicle Sales18.2M--1
00:50JPY+ Capital Spending y/y5.6%--1
01:30AUD+ Building Approvals m/m2.2%--3
01:30AUD+ Current Account-19.0B--3
02:35JPY+ Final Manufacturing PMI52.8--1
04:30AUD+ Cash Rate2.00%2.00%-5
04:30AUD+ RBA Rate Statement---5
04:45JPY+ 10-y Bond Auction0.32|2.8--1
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