Archive for December, 2009
Become Quick Rich with Binary Options Trading
Posted by Cedrick Toledano in Binary Options on December 21st, 2009
In this world that is completely covered with negative headlines and many corporate scandals heading one after the other, binary options trading is the ideal way to make entry or exit out of the forex market instantly with high yielding returns.
Binary options trading is a wonderful filed emerged in the investment world. According to its name, this kind of investment options comprises of 2 possible results in a binary trading agreement that will either lose or win. The method in which most of the agreements are planned is there exists fixed payouts to win that are almost seventy five percent gains along with your initial amount of investment, whereas the losing payout is not more than fifteen percent returns on your capital.
A trade of the initial payout amount of two hundred dollars in a binary trade will pay you three hundred and fifty dollars, whereas a trade that would be claimed as unsuccessful may pay you about thirty dollars only. There is nothing strange or astonishing to attain the returns of your capital on some false actions, however that aids in making the market work and it indeed generates some amazing probabilities for hedging. It is something similar to receiving a parting present on the game shows.
However, there are restraints on the possible probabilities to take part in the forex market because recently there are not more varieties’ of securities that are being traded in the binary market. Alternatively, these few of the securities that are being traded in the binary trade are highly liquid like the Yen/ USD forex rate, NASDAQ, Google, Microsoft and many more.
Another important thing about such kind of investment option is its instant turnover prices on the investments. The binary options have a characteristic feature that is they have their expiration period every hour. That means your payoff for the investments takes place within the similar day instead of taking a long period of time, say: weeks, months or days.
Another important feature of this binary options trading are the few obstacles towards its entry. It requires a sum of only hundred dollars to create your binary account. Just compare it to the ten thousand dollars that are required to create your traditional trading accounts with your daily brokerage firms. That is why it is risk-free to carry on trading in this market. Therefore, a number of traders are getting involved in it day by day and enjoying the wonderful advantages, that is has for its traders.
Even a common man can begin to trade in the binary market with some knowledge skill and an instinct to carry on a successful trade. It is that simple and easy to learn and understand. So, start your binary options trading today and avail its great benefits that it provides you as a trader.
Daily Review 18/11/2009
Posted by Cedrick Toledano in Uncategorized on December 18th, 2009
USD Dollar (USD)
The Dollar gained versus most majors as Industrial Production came out weaker, lowering risk appetite. Industrial Production came out 0.1% versus 0.4% expected. PPI came out weaker with 0.3% versus 0.6% forecast. TIC Long-Term Purchases came out better with 40.7B versus 27.3B expected. NASDAQ and Dow Jones rose slightly by 0.27% and 0.29%. Crude gained by 0.68% closing at 79.44$ a barrel and Gold (XAU) remained almost unchanged with 0.16% change closing at 1140.5$ an ounce. Today, Building Permits are expected higher with 0.59M versus 0.57M prior and Core CPI is expected with 0.1% versus 0.2% prior. Housing Starts are expected higher with 0.61M versus 0.59M and Crude Inventories are expected with 1.2M versus 1.8M prior.
EURO (EUR)
The Euro weakened versus the Dollar and the Pound as risk appetite weakened and ECB\’s president Trichet said a strong Dollar is important for the world economy. European Trade Balance came out better than expected with 6.8B versus -0.9B expected. EUR/USD traded with a low of 1.4806 and with a high of 1.4998. Today, European Current Account is expected with 0.6B versus -1.3B prior. ECB President Trichet will speak in Frankfurt.
EUR/USD – Last: 1.4870
|
Resistance |
1.4900 |
1.4925 |
1.4955 |
|
Support |
1.4810 |
1.4740 |
1.4703 |
British Pound (GBP)
The Pound remained almost unchanged versus the Dollar as CPI figures came out better than expected but Industrial Production in the U.S lowered investors Risk Appetite. CPI came out 1.5% versus 1.4% expected and RPI came out -0.8% versus -0.9% expected. Overall, GBP/USD traded with a low of 1.6755 and a high of 1.6872. Today, MPC Meeting Minutes will be released. CBI Industrial Order Expectations are expected with -47 versus -51 prior.
GBP/USD – Last: 1.6800
|
Resistance |
1.6850 |
1.6900 |
1.6955 |
|
Support |
1.6750 |
1.6670 |
1.6625 |
Japanese Yen (JPY)
The Yen gained versus the Euro and weakened versus the Dollar as risk appetite lowered after Industrial Production in the U.S came out weaker than expected. Overall, USD/JPY traded with a low of 88.73 and a high of 89.53 and EUR/JPY traded with a low of 132.44 and a high of 133.58. Today, All Industries Activity is expected with -0.1% versus 0.9% prior.
USD/JPY-Last: 89.17
|
Resistance |
89.65 |
90.00 |
90.18 |
|
Support |
88.80 |
88.60 |
88.25 |
Canadian dollar (CAD)
The Canadian Dollar dropped as Risk Appetite weakened following U.S production data. Overall, USD/CAD traded with a low of 1.0464 and a high of 1.0617. Today, Canadian CPI is expected with 0.2% versus 0% prior and Core CPI is expected with 0% versus 0.3% prior.
CAD/USD – Last: 1.0535
|
Resistance |
1.0620 |
1.0680 |
1.0735 |
|
Support |
1.0475 |
1.0450 |
1.0425 |
Research by http://www.ufxbank.com
An overview to bungee options trading
Posted by Cedrick Toledano in Bungee Options on December 18th, 2009
Bungee options trading are one of the popular kinds of trading in the foreign exchange market. Though this kind of trading has been creating a lot of moves in the market it has been seen that there are a lot of traders trading into the forex market with bungee options. When it comes to forex market it can be said that it is one of the largest and the most volatile market when compared to any other markets in the world. There have been many traders who have started taking up knowledge about what is meant by bungee options trading and how it is beneficial and thus have started testing their fortunes with bungee options trading in the forex market.
The major reason why bungee options’ trading is referred to as bungee trading is because there can just be two outcomes to this that is either the trader can win in the trade or then he may lose all. There is no other way out for any of the trader opting to this kind of trade. The major reason why most of the forex traders in the forex market opt for trading the bungee options is because there are no fixed entry and exit timings. The trader can step in the market and carry out trading and can also leave the market when he may feel that he does not want to trade for the day.
Bungee options trading in the forex market can also be referred to as one of the best options to make some quick bucks irrespective of whether you are a full time trader or then just a part time trader trading into the market. But then it is very important that each trader who may opt for bungee options trading has some knowledge about what it is and what are the different criteria’s that it depends upon. Some of the parameters on which bungee options trading depends upon is the strike rate and the maturity date. Strike place is considered to be a level above which payments are possible and the maturity date is a date on which the bungee options may expire.
Whenever the bungee options are sold the forex trader gets a premium amount in exchange. The trader can also access the call and the put option while opting for bungee options trading. But then the trader has to remember that there is a lot of difference between standard forex trading and bungee options trading. This big difference is because the payout profile of bungee options is different as compared to the returns from any other type of trading in the forex market. Thus it is very important that before any trader tries to trading bungee options he should first look into the technicalities.
GoLearn Forex Analysis 17/12/2009
Posted by Cedrick Toledano in Uncategorized on December 17th, 2009
Is the CAD Headed for a Breakout? By GoLearn Forex
USD/CAD:
The Canadian Dollar from a technical standpoint is giving every indication it is going to breakout. Price has been consolidating for several weeks. You can see more clearly the consolidation in the Chart below depicted by the orange triangle.
Typically we draw a triangle where only one side represents the slope. However, the triangle drawn below is indicative of investor’s uncertainty with regards to the CAD. The Canadian economy is holding strong. The CAD is a commodity currency and will rise and fall as commodity prices rise and fall (in particular Oil). The Dollar has been rallying which should mean a weaker Loonie, but this rally stems from positive U.S economic data. The U.S economy and that of their northern neighbor are linked to a certain extent as they feed off of one another. Therefore, positive U.S data should also be good for the CAD. Therein lies the conflict and thus you have a dual sided sloping triangle.
The CAD is currently trading above its 50 day MA. Similar to the AUD and NZD it failed to breach the 100 day MA in spite of the Dollar rally. As the CAD wedges itself into the triangle we are looking for the following to occur in order to trip an entry signal. If the Loonie produces a candle south of the 50 day MA and south of the bottom slope of the triangle then look to enter a Long CAD position. Alternatively, if the CAD produces a candle body north up the upper slope of the triangle and the 100 day MA then enter a Short CAD position. Lastly, if a Short CAD signal triggers we see a near term take profit level at 1.0880 coinciding with the Fibonacci 23.6% Retrace level. We view this level as strong point of resistance.
Oil Takes Off by GoLearn Forex
The FOMC meeting came and went without stirring the waters. In the Euro-zone and London, Equity Markets finished their sessions in positive territory ahead of the highly anticipated U.S FED rate decision. The accompanying FOMC statement was intentionally left mostly unchanged so as not to roil markets. It served its purpose well as the DJIA finished the day off slightly lower by 10.88 points to close at 10,441.12 while the tech heavy NASDAQ closed up 5.86 points to 2,206.91.
In the Currency Markets the Dollar followed Equity Markets finishing the session nearly flat against its G-7 counterparts. The AUD gave up .61% still reeling from CB comments that took on a more dovish tone in regards to any near term future rate hikes.
Oil soared to 73.54 during intra-day trading before leveling off the day at 72.66, a gain of $1.97. Gold climbed $12.70 an ounce to 1,137.90. On the Agricultural front Soybeans, Cotton and Sugar continued to rally while Copper, Wheat and Corn declined on Dollar strength.
On the economic data docket for today we have the BOJ rate decision to be announced, although no change is expected. In the U.K, Retails Sales are set to be released while in Canada CPI data will hit the wire. In the U.S, Jobless Claims will print as will the measure of Leading Indicators and the Philadelphia FED survey.
Upcoming Forex Events for December 17, 2009
GBP Retail Sales (MoM) Forecast 0.50% Previous 0.40%
CAD Core CPI (MoM) Forecast 0.10% Previous 0.10%
USD Initial Jobless Claims Forecast 470.00K Previous 474.00K
JPY Interest Rate Decision Forecast 0.10% Previous 0.10%
Analysis by http://www.golearnforex.net
Daily Review 17/12/2009
Posted by Cedrick Toledano in Uncategorized on December 17th, 2009
USD Dollar (USD)
The Dollar gained massively across the board on the day the Federal Reserve decided to leave rates as expected at 0.25%. The Dollar rose after the announcement and continued its gaining after Asia markets opened. Earlier, the Building Permits came out 0.58M better than expected 0.57M. CPI came out unchanged as expected at 0.4%. Wall Street finished mix after being unable to hold in the positive side. Stocks turned to the negative after the statement of the FED about monetary policy. The Dow Jones fell 0.10% and NASDAQ rose by 0.28%. Crude Oil kept gaining for the second day closing at 72.77$ a barrel after the oil inventories showed a 3.7M drop. Gold (XAU) gained also closing at 1137$ an ounce. Today, the Initial Jobless Claims expected at 470K vs. 474K previously. The Philadelphia Fed Manufacturing Index expected at 16 vs. 16.7 previously.
EURO (EUR)
The Euro fell against the Dollar and the Pound, breaking through the 1.4500 and 1.4400 support levels, after the CPI came out 0.5% worse than expected 0.6%. The breakdown of this level could bring the pair to fresh new lows. Manufacturing PMI came out 51.6 better than expected 51.5. Overall, EUR/USD traded with a low of 1.4379 and a high of 1.4590. Today, the Italian Unemployment Rate expected 7.7% vs. 7.4% previously.
EUR/USD – Last: 1.4410
|
Resistance |
1.4500 |
1.4600 |
1.4675 |
|
Support |
1.4345 |
1.4300 |
1.4235 |
British Pound (GBP)
The Cable was the best performer among majors. GBP/USD momentarily broke above 1.6370 and rose to 1.6404, reaching a one-week high but then pulled back, breaking below the 1.6300 support level, reaching lows of 1.6230. Claimant Count Change came out -6.3K better than the expected 14K. Overall, GBP/USD traded with a low of 1.6230 and a high of 1.6409. Today, the Retail Sales expected at 0.5% vs. 0.4% previously. The CBI DTS expected at 16 vs. 13 previously.
GBP/USD – Last: 1.6275
|
Resistance |
1.6425 |
1.6475 |
1.6525 |
|
Support |
1.6275 |
1.6210 |
1.6170 |
Japanese Yen (JPY)
The Yen fell against the Pound and the Dollar. The Dollar reached a one-week high against the Yen as the Federal Reserve said deterioration in the labor market is abating while it will keep its low rate for an extended period. Overall, USD/JPY traded with a low of 89.37 and a high of 89.96. Today, the interest rate decision of The Bank of Japan (BOJ) expected unchanged at 0.1%.
USD/JPY-Last: 89.65
|
Resistance |
89.95 |
90.40 |
90.75 |
|
Support |
89.30 |
88.75 |
88.35 |
Canadian Dollar (CAD)
The Canadian currency gained as crude oil and stocks rose. It was little changed after policy makers in the nation and the U.S. made commitments to keep interest rates at historic lows. The Manufacturing Sales came out 2% better than expected 0.5%. Overall, USD/CAD traded with a low of 1.0570 and a high of 1.0641. Today, The Core CPI expected unchanged at 0.1%. The Foreign Securities Purchases expected at 10B vs. 13.59B previously.
USD/CAD – Last: 1.0615
|
Resistance |
1.0640 |
1.0670 |
1.0700 |
|
Support |
1.0570 |
1.0550 |
1.0515 |
Research by http://www.ufxbank.com
Binary options in Forex
Posted by Cedrick Toledano in Binary Options on December 17th, 2009
Forex trading market has a tremendous amount of potential in money making. A Forex trader can earn good amount of profits by trading international currencies. But one has to develop a good consistency to achieve the success. One should get an authentic and reliable education of Forex trading and training in the same. One should also develop prediction skills for knowing the rise of prices.
Let us take an example. If one decides to take a trading pair as EUR/USD, one shall wish that the prices of Euro to go up as compared to US Dollar. Thus he shall place a BUY order. If one places his trade using 1 mini lot which is equal to $1 for each pip and having target of 30 pips then he should have at least 1000$ into his account to meet the margin requirements. Here if the trade becomes successful then he shall make a profit of around $30.
But if the example put above is required to happen then the price of Euro should go 30 pips against the US dollar. Otherwise one shall not reach the destined target and profits as well. If one goes for Forex trading in a traditional approach, it becomes difficult. The reason is that one has to not only predict the prices but the time and extent for their movement as well.
Let us take an example of $1000 in a binary trading account. Let us see what are the things required to make a successful trade over here. Let us consider the price of EUR/USD to be 1.47849. With the help of analysis of Forex trading market by say swing trading pattern recognition, one may think that Euro would go up against US Dollar. But here instead of placing BUY order, one can simply go for a call option of $100 having expiry of one hour. If the price goes up at least 0.001 pip above the purchase price for call option (which is also called as strike price) and is it remains there till expiration then one shall get as much as 75% on the $100 of investment. Thus one can say that one may get 75$ of profits on 100$ of investment. One can repeat this procedure many times in a day. The most important thing is that one is not required get a price shoot-up of 30 pips in one hour. Only 0.001 points of variation can suffice the purpose.
In this scenario, one has to predict the direction of the movement of price, which is the usual factor in Forex trading. But it is not required to predict 30 pips or something like that in order to expect the profits. Another thing is that one can open a binary account with minimum amount of 100$ and he can trade as little as 30$ with no commission charges.
GoLearn Forex Analysis 16/12/2009
Posted by Cedrick Toledano in Uncategorized on December 16th, 2009
Review Key Support and Resistance Levels for USD by GoLearn Forex
Key Support & Resistance (S/R) Levels:
As the Greenback continues to rally heading into the end of the year we thought it would be a good time to review a couple key S/R levels. Traders generate S/R based on a number of factors. One key factor is based on the tenor of the chart the trader is using. A trader using a tick or minute chart will be less concerned about S/R generated from a 4 hour chart that is 100+ pips from the current handle. However, that same trader will want to know where the longer term S/R levels sit. If price moves towards those points he can integrate them into his trading strategies thereby profiting and or avoiding losses.
GBP/USD:
The Cable is currently sitting below its 100 day MA which generates an already negative bias. A candle body below 1.6198 would generate the next Short entry point Near term profit taking would be the 200 day MA. If the 200 day MA is breached we would target the low of this range bound period near 1.5683 which also represents the Fibonacci 38.2% Retrace level. The 38.2% Retrace level was generated from the Sterlings turn around in January of this year.
AUD/USD:
The Aussie has shown great resilience and for good reason. The RBA had taken a hawkish stance on rates as it was amongst the first to raise rates. The Australian economy is in relatively good shape. Additionally, the AUD is a commodity currency and it has ridden the commodity rally. Currently the AUD is sitting just below the 50 day MA. A candle body appearing below .8944 equal to the Fibonacci 76.4% Retrace level, which also coincides with recent support levels would trigger a near term Short entry. We would increase the Short position with a close below the 100 day MA, currently holding at .8834. A long signal would be generated with a close well above near term resistance at .9325.
With the EUR taking a sharp nose dive yesterday it prompts us to look at recent relative price levels on the G-7. The EUR/USD is the most commonly traded pair in the world. The price of the EUR has broad implications on the relative value of other G-7 currencies. Although the below data can be shown graphically it is easier to view price differentials in a table. If the EUR is a leading indicator of relative value then the CAD, AUD, and GBP may be in for a minor drop.
Historical
Date EUR CAD AUD NZD JPY GBP
2009-10-02 1.4576 1.0797 0.8652 0.7160 89.8050 1.5946
2009-10-01 1.4545 1.0839 0.8697 0.7149 89.6050 1.5955
2009-09-30 1.4640 1.0695 0.8828 0.7232 89.7050 1.5982
2009-09-29 1.4587 1.0846 0.8703 0.7143 90.0885 1.5961
Current
Date EUR CAD AUD NZD JPY GBP
2009-12-15 1.4533 1.0611 0.9067 0.7224 89.6355 1.6272
US Producer Prices Climb by GoLearn Forex
Global Equity Markets were mixed on Tuesday as Dubai continues to sort out its debt repayment obligations. In the U.S Producer Prices climbed 1.8% which was more than double expectations. This caused stocks to retreat as it may engage the U.S Fed to raise rates out of necessity instead of a planned withdrawal from its current quantitative easing policies. The DJIA slid 49.05 points to close at 10,452. Ahead of the rate decision today traders have consolidated positions as markets may move drastically depending on what language the Fed uses.
There are a number of other economic data releases on the docket for today. Oil traders will be watching Crude Oil Inventory figures. CPI data as well as Housing Starts and Building Permits will also be on the wire today. In the U.K Jobless Claims will print although no major changes are expected. GDP in Australia has already printed slightly below expectations.
The Greenback continued to advance against its G-10 counterparts with the AUD giving up 1.15% for the day. The DXY closed above the 100 day MA to 76.961 helping to legitimizing the recent rally. Gold and Oil were essentially unchanged finishing the U.S session at 1.125.20 and 70.69 respectively.
Upcoming Forex Events for December 16, 2009
EUR CPI (YoY) Forecast 8.00% Previous 7.80%
USD Core CPI (MoM) Forecast 0.20% Previous 0.20%
USD CPI (MoM) Forecast 0.40% Previous 0.30%
USD Interest Rate Decision Forecast 0.25% Previous 0.25%
Complete explanation to Binary options trading
Posted by Cedrick Toledano in Binary Options on December 16th, 2009
Fixed return options can be a perfect name for binary options as there are possibly only two outcomes of this trading that are completely realized at the time of onset of the contract. Binary options is basically a contract that gives the buyer that is the owner the right however not the obligation, for purchasing an underlying asset at the set price in a particular period of time.
Underlying assets are basically the items that are traded. In forex these underlying assets are nothing but currency and an example of it is USD/JYP. The price that is set at which the owner purchases or sells it is called as strike price. At the time of binary options trading the buyer has to think whether underlying assets will be hitting the strike price till the term of the expiry. This needs to be done at the end of the hour or day or week or month.
In case the owner thinks that during the time of expiry the option will be higher than the current price, then the owner will place call option on the binary option. If the owner thinks that the option will be less than the current price the owner places put options.
Therefore it is said that binary options trading is a flexible one. The owner can have control over the asset, time of expiry and also guessed asset direction and accordingly select that the owner wants. One thing that is unknown is that whether the asset will expire lower or higher which is actually the existing price.
Binary options trading differ from traditional form of trading only in one respect that is in binary options a buyer will be trading on the performance of the asset and that they will actually not own the asset. There are many advantages that a binary option has and this has made it more preferable among the forex traders.
For binary options trade you only require to sense as to which direction will be the movement of the asset. This makes binary options much simpler. The binary options involve controlled risks during the time of the onset of the contract. There are only two possible outcomes which are determined priory and are fixed by the buyer which depends on how much the buyer invests in the option. To have successful binary option trading it is required that the options moves in the desired direction and the magnitude of move is not required. This makes it simpler to gain payouts. One of the advantages that is already mentioned above is that it is highly flexible and this is also one point that is advantageous as far as buyer is considered.
Daily Review 16/12/2009
Posted by Cedrick Toledano in Uncategorized on December 16th, 2009
USD Dollar (USD)
The Dollar gained versus 15 of the 16 majors as Industrial Production rose by 0.8% versus 0.6% expected signaling U.S economy is expanding. The FOMC is still expected to keep the Interest Rate today at 0.25% but more economists expect a rate increase to 0.5% until June 2010. PPI came out stronger with 1.8% versus 0.8% expected and TIC Long Term Purchases came out weaker with 20.7B versus 38.3B prior. NASDAQ and Dow Jones declined by -0.50% and -0.47% respectively as wholesale inflation raised concerns the Fed will be forced to raise interest rates. Crude gained by 0.17% closing at 70.81$ a barrel ending a 9 day declining streak. Gold (XAU) gained by 0.29% closing at 1125.70$ an ounce. Today, Building Permits are expected with 0.58M versus 0.55M prior. CPI is expected with 0.4% versus 0.3% prior and Core CPI is expected with 0.1% versus 0.2% prior. Investors are waiting for the FOMC Interest Rate decision that is expected to remain at 0.25%.
EURO (EUR)
The Euro fell versus the Dollar and the Pound after weaker French CPI results, which triggered the Euro\’s decline. German ZEW Economic Sentiment came out 50.4 slightly better than 50.1 expected but ZEW Economic Sentiment came out weaker with 48 versus 50.9 expected. More countries in the Euro zone show signs the recession is still alive. Greece is struggling with its debt and Austria nationalized Hypo Bank. Overall, EUR/USD traded with a low of 1.4503 and a high of 1.4659. Today, German and French Manufacturing PMI are expected slightly stronger. CPI and Core CPI are expected unchanged with 0.6% and 1.2% accordingly.
EUR/USD – Last: 1.4535
|
Resistance |
1.4575 |
1.4625 |
1.4685 |
|
Support |
1.4500 |
1.4445 |
1.4410 |
British Pound (GBP)
The Pound weakened versus the Dollar but gained versus the Euro after CPI came out 1.9% versus 1.8% expected. The CPI figures show inflation is advancing and the U.K won\’t be able to keep interest rates at their record lows. Overall, GBP/USD traded with a low of 1.6205 and a high of 1.6319. Today, Claimant Count Change is expected with 13.9K versus 12.9K and MPC Member Miles will speak in London.
GBP/USD – Last: 1.6275
|
Resistance |
1.6315 |
1.6350 |
1.6380 |
|
Support |
1.6210 |
1.6160 |
1.6105 |
Japanese Yen (JPY)
The Yen dropped versus the Dollar and the Euro as a near US interest rate increase seems likely in the upcoming year. Overall, USD/JPY traded with a low of 88.61 and a high of 89.95 and EUR/JPY traded with a low of 129.54 and a high of 130.73. No economic data expected today in Japan.
USD/JPY-Last: 89.65
|
Resistance |
89.95 |
90.40 |
90.75 |
|
Support |
89.30 |
88.75 |
88.35 |
Canadian Dollar (CAD)
The Canadian Dollar followed the trend and fell against the Dollar but gained versus most other majors as Crude prices rose slightly ending its 9 day decline. Leading Index came out better with 1.3% versus 0.6% and Labor Productivity came out weaker with -0.2% versus -0.4% expected. Overall, USD/CAD traded with a low of 1.0552 and a high of 1.0611. Today, Manufacturing Sales is expected with 1% versus 1.4% prior.
USD/CAD – Last: 1.0615
|
Resistance |
1.0670 |
1.0700 |
1.0750 |
|
Support |
1.0580 |
1.0550 |
1.0515 |
Research by http://www.ufxbank.com
GoLearn Forex Analysis 15/11/2009
Posted by Cedrick Toledano in Uncategorized on December 15th, 2009
NZD Beginning to Falter by GoLearn Forex
NZD/USD:
The New Zealand Dollar is starting to falter and like most of its G-10 counterparts it is holding at pivotal levels against the Greenback. One slip either way may send the currency tumbling or ready to resume its advance on the Dollar. We have mentioned the Kiwi in the past as we feel it may yield the biggest percentage loss when the Dollar does finally rally.
In the graph below we see the formation of a downward sloping Triangle beginning to emerge. The Kiwi has been riding the 50 day SMA as support on its path to .7600. You can observe that NZD peaked in late October but after 3 attempts it has failed to break the October high.
Short term support has been holding near .7100 represented by the bottom leg of the triangle. As the hypotenuse converges on near term support the more likely it is that a breakout will occur in the direction of the slope. We have also diagrammed a pattern we use often to identify trend and that is a step pattern whereby there are lower high’s and lower lows (or vice versa as the case maybe). Typically we like to see more obvious lower lows than what the Kiwi has shown us thus far.
The NZD is currently sitting below its 50 day MA, which we mentioned prior, represented support for the NZD’s move over the last 9 months. During the Dollar’s rally last week the Kiwi was able to bounce off of the 100 day MA but was not able to bounce back above the 50 SMA. As price action moves into the wedge of the triangle it may force price below the 100 SMA.
For good measure we added a Fibonacci Retrace starting back in March when the Kiwi dipped below .50 running through its most recent high in October when the NZD struck .7635. This data range produces the 23.6% Fibo Retrace at a handle of .6988. To trigger a strong short signal the Kiwi would need to take out the 100 day MA, near term support (the base leg of the triangle), and the Fibo 23.6% level, as we then target a .6500 handle. In order to resume a Long NZD position at this point the NZD would need to break north of the hypotenuse, the 50 day MA, and near term resistance at .7525.
Short term support has been holding near .7100 represented by the bottom leg of the triangle. As the hypotenuse converges on near term support the more likely it is that a breakout will occur in the direction of the slope. We have also diagrammed a pattern we use often to identify trend and that is a step pattern whereby there are lower high’s and lower lows (or vice versa as the case maybe). Typically we like to see more obvious lower lows than what the Kiwi has shown us thus far.
The NZD is currently sitting below its 50 day MA, which we mentioned prior, represented support for the NZD’s move over the last 9 months. During the Dollar’s rally last week the Kiwi was able to bounce off of the 100 day MA but was not able to bounce back above the 50 SMA. As price action moves into the wedge of the triangle it may force price below the 100 SMA.
For good measure we added a Fibonacci Retrace starting back in March when the Kiwi dipped below .50 running through its most recent high in October when the NZD struck .7635. This data range produces the 23.6% Fibo Retrace at a handle of .6988. To trigger a strong short signal the Kiwi would need to take out the 100 day MA, near term support (the base leg of the triangle), and the Fibo 23.6% level, as we then target a .6500 handle. In order to resume a Long NZD position at this point the NZD would need to break north of the hypotenuse, the 50 day MA, and near term resistance at .7525.
Abu Dhabi Sending Financial Aid for Dubai World by GoLearn Forex
World Equity Markets gained some ground Monday amid assurances from Abu Dhabi that they would provide $10 billion in immediate financial aid to ensure Dubai World meets its $4.1 billion debt obligation due yesterday. The DJIA closed a shade above 10,500 after picking up 29.55 points.
The Greenback gave up a little ground yesterday as the DXY was down marginally to 75.352. Gold advanced slightly to 1,126.70 as the dollar showed some weakness. Oil was unchanged as it continued to hold below $70 a barrel.
In the U.K CPI data is set to print today. The Euro-zone’s Current Sentiment/Survey will publish today. In the U.S a number of economic releases are slated for today; Crude Oil Inventories, Gasoline Inventories, Total Net TIC Flows, Empire Manufacturing Index, and lastly PPI figures will print. In light of the Dollar’s recent rally expect that traders will be watching these numbers very carefully ahead of tomorrow’s FOMC rate decision.
Upcoming Forex Events for December 15, 2009
EUR German ZEW Economic Sentiment Forecast 50.20 Previous 51.10
CAD Leading Indicators (MoM) Forecast 0.60% Previous 0.70%
USD TIC Net Long-Term Transactions Forecast 43.00B Previous 40.70B
AUD GDP (QoQ) Forecast 0.40% Previous 0.60%
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