Low Volume at the Start of the Week, Mortgage Stocks Surge

The U.S stock market started the week on a positive note, ending the session with mild gains. Even though the intraday session was characterized by choppy trading, the indices received a boost towards the end of the session, backed by individual stocks from the housing sector.

Positive sentiment already came during morning hours, as China stated that its growth could reach 10% by next year. China, known for its massive surplus, expanded throughout 2009, by a whopping 8.5%, as various stimulus measures helped to boost the economy. Chinese Premier Wen Jiabao said yesterday the national economy had improved and was back on track to reach the growth target during 2010. Furthermore, he mentioned that policy makers do not intend to change the management of the Yuan.

Read the full article at dodjit.com

A Lack of Economic Data Sent the Indices Higher, USD/CAD returns to test its break-out

The shortened week started off on a positive note, as Asian indices climbed higher. Positive sentiment quickly spread to Europe and the U.S, sending all the major indices to higher levels. One must note that the Nasdaq closed the session at a new high at 1828.79, after breaking through strong resistance.



The economic calendar lacked market-moving data yesterday, therefore traders turned to previous price action, continuing Friday’s trend. Even though the indices bounced at the start of the session, they presented a lackluster session, consolidating up until the close.

Read the full article at dodjit.com

A wave of Data Led to Further Consolidation

Inflation data was scrutinized by investors ahead of the rate decision to see if there would be any changes to the wording of the FOMC statement due to the numbers. The Federal Reserve Statement displayed little change from prior statements and alerted that market that monetary easing would continue for a substantial period of time. These comments were expected by market participants and the reaction was already baked into the market’s price.
Employment data also grabbed market participant’s attention as Thursday’s first-time jobless claims rose by 7,000 to 480,000, defying expectations of Wall Street’s economists that the number would drop. The less volatile four-week average of new claims, however, fell by 5,250 to 467,500, maintaining a healthier trajectory.



The week ended with the Bank of Japan's policy meeting. The board voted unanimously to leave its policy rate unchanged at 0.1%, as it studies the effects of a measure announced earlier this month to try to lift demand. One must note that the BOJ offered up to 10 trillion yen ($111.2 billion) in short-term funds to the market. The policy board also said in a statement that it decided to "further disseminate" the BOJ's thinking on price stability, and made it clear that the board won't tolerate on-year falls in the consumer price index.

Read the ful;l article at dodjit.com

Dollar Bulls are Still in Control, USD/CAD and AUD/USD now in the Spot Light

The U.S stock market inched higher yesterday, closing with an average gain of 0.2%, after the Fed released its important interest rate decision. While some were expecting a more hawkish statement, market participants managed to read between the lines, understanding that the Fed is now acknowledging the recent economic rebound. Even though the Fed stated that they intend to maintain a low rate policy, the bank touched recent developments in the job market and financial markets, mentioning minor improvement.

Read the full article at dodjit.com

Consolidation on the Forex Market, Stocks Creep Higher

After climbing at the start of the session, the U.S stock market remained in range up until the closing bell. Economic data was the major culprit yesterday, as data from the U.S showed a mixed picture.

Similar to last week’s increase Initial jobless claims jumped more than expected to 474.00k. The Georgia department said that 72,298 laid-off workers filed initial claims for state unemployment insurance benefits in November, a 2.4% increase from October. Even though the news wasn’t inspiring, it didn’t have much of an effect on the intraday session as the U.S Trade Balance Index showed a slight improvement of -32.90B, compared to a previous-35.70B figure. According to the data, October’s exports were $3.5 billion more than September’s exports, while imports increased just $0.7 billion.

From a technical point of view the major indices continued to trade in range, led higher by consumer Discretionary and Utilities.



Read the full article at dodjit.com

The Dollar Showed Mixed Signals Around its 50 Day Moving Average

The Dollar followed Friday’s trading day and continued higher throughout yesterday’ session. Even though during the start of the session, the Greenback presented minor weakness, Bernanke’s mixed speech helped to drive the Dollar to higher ground.

In a speech before the Economic Club of Washington D.C, Fed chairman Ben Bernanke hinted that interest rates should stay at low levels for an extended period of time. The Fed Chairman commented on the recent recovery, mentioning that that even though the U.S economy is slowly bouncing back, it still has various obstacles to overcome, ones which could weigh on the current recovery, causing slow economic growth. In addition, Bernanke touched on the financial situation, stating that their remains credit problems under the surface.

Read the full article at dodjit

The Dollar Strengthens on Better Than Expected Data

The Dollar/Yen had a turn for the better on Friday as investors began to speculate that the decrease in unemployment could lead the Fed to raise interest rates sooner than expected. Friday’s session was a classic “buy the rumor, sell the fact”. Furthermore, news earlier last week mentioned that the Bank of Japan plans to introduce new liquidity measures to combat falling prices. Under the new program, the BoJ will provide JPY10 trillion of three-month loans to commercial banks at a fixed rate of 0.1%. In exchange, banks will provide regular BoJ collateral. The decision was unanimous but the BoJ had come under heavy pressure from the government to cooperate in battling deflation. The USD/JPY surged on Friday, to break trend line resistance at 89.50.



Read the full article at dodjit.com

Good Data Didn't Drive the Markets Higher (Video)

The Dollar Trades Steady

On individual pairs, the USD/JPY came up to prior resistance, as investors grabbed the low levels for a quick profit. In addition officials helped to boost the value of the Dollar after mentioning that they intend to further help the Japanese economy. According to recent news, the BOJ intends to inject an additional 1 trillion yen ($11.5 billion) into short term money markets.

The EUR/USD and GBP/USD also traded steady after economic data showed a mild improvement. Construction PMI came out as expected at 47.00, while the Euro-zone’s PPI figure increased by 0.2% on a monthly basis, higher than analyst’s expectations of 0.1%.

Read the full article at dodjit.com

Commodities Jumped, Will They Continue Higher?

Commodities grabbed news headlines last week, as Gold, Silver and Platinum all presented sharp moves higher. The moves came as traders jumped into these safe-havens, prior to the closely watched employment result that was scheduled to be released on Friday.  Gold presented an enormous intraday break up and moved up by $34 dollars per ounce this week or 3.7%.  This precious metal tested the $1,000 mark, but failed to break the level on Friday, after the employment report.  In addition, silver broke out to new highs for 2009, smashing through trend line resistance to close at $16.23 for the week.   Silver had an outstanding move for the week, moving up by $1.45 an ounce (9.8%), to close around major resistance.  One must note that Gold and Silver are now currently trading around major psychological resistance. Even though a correction is expected around current levels, a break of current levels by the two commodities will confirm a continuation of both the trends.
Read the full article at dodjit

Dollar Counterparts Received a Boost at the End of the Session

After a drop at the start of the session, investors grabbed the lower prices, driving the major indices to close with gains. Unfortunately investor’s didn’t pay much attention to the GDP figure yesterday, as Crude oil weighed on the session, dropping below $70. After a tri-star doji pattern the major indices were in need for a correction, but instead of taking profits, investors took advantage of the lower prices to jump on the current trend. The S&P500 closed the session with a gain of 0.28%, while the Nasdaq bounced higher finishing with a 0.24%

Read the full article at dodjit.com

Markets are in Pause Mode, Waiting the Fed’s Decision

Investors pressed the sell button yesterday, preferring to take profits on recent gains. The major stock indices closed in negative territory after presenting a choppy session. After Friday’s interesting day, economic data was brushed aside due to its low priority status, allowing investors to focus on recent earning reports.
Read the full article at dodjit.com

A Volatile Stock Session, USD/CAD at a Critical Level

Tags: Tips, Stocks, Forex, Confidence, House Data, China
Economic data had a major impact on the intraday session yesterday, increasing the daily volatility. After approximately 11 days of gains the S&P500 got stopped in its tracks, as the consumer confidence result weighed severely on investors, sending them back into the Dollar safe-haven.

The start of the U.S stock session yet again encouraged buyers back into the market as the S&P/CS Home Price Index showed for the first time in nearly 3 years an increase. One must note that the index measures the price of houses in 20 regions in the U.S, allowing investors to analyze the strength of the housing market. Even though the major indices opened with minor gains, a majority of them quickly lost their steam, as consumer confidence figures hit the board, showing that consumers are still not overly impressed with the recent economic activity. Confidence showed a 46.6 figure compared to an expected 49.00 points.
Read the full article at dodjit.com

Earnings are Driving the Indices Higher

 Tags : Apple, Stock, Dupont, Caterpillar, Aud, Pound, Dollar, Forex, Yahoo
A lot of tension was felt during the U.S stock session yesterday, as Ben Bernanke gave his quarterly statement about the economy and future outlook, while certain large caps released their earnings.

Fed Chairman Ben Bernanke delivered his testimony on Capitol Hill, mentioning that even though the rate of the contraction is declining, the U.S economy still has a long way to go until it begins to show healthy economic growth. The chairman mentioned that economic growth is expected throughout 2010, but it could still be accompanied by high unemployment. Bernanke also touched on the inflation subject, preparing investors in advanced, incase monetary tightening will be required. To date the Fed has numerous methods that it can carry out to prevent inflation, some of which include selling a portion of its long-term securities holdings and selling bills and deposits.

Read the full article at dodjit.com

There Still Remains One Barrier

 Tags : Stocks , Goog , Goldman Sachs , Cit , Pound , IMF
After weeks of swinging from side to side, the major U.S stock indices bounced higher as traders and investors alike pulled money out of safe-haven assets and rushed back into riskier ones. The beginning of last week already signaled to traders that something promising was about to happen, as the S&P500, the broader market index, bounced off its 200 day moving average, after forming a tri-star doji pattern. (Please note that a tri-star doji is quite rare and will often signal a change in trend).

Read the full article at dodjit.com

Higher Gas Prices Give CPI a Lift, But Annual Prices Drop Most Since 1950

Tag : S&P500, Head and Shoulders, Stocks
At the start of the week, we posted a
potential inverted head and shoulders pattern on the S&P500.
Yesterday's session was characterized by increasing momentum as the
major indices soared higher. The S&P500 broke major resistance and
held onto its gains throughout the whole of the session.
Read the full article at dodjit.com

The sun is starting to shine on Wall Street

Tags:Dollar, Cit, S&P, Intel
Intel encouraged buyers to come back into the market yesterday, sending the indices soaring at the start of the session. Following Goldman Sachs positive result, Intel showed investors that the computer industry isn’t as bad as previously thought.  The world’s largest micro processor hinted that the economic future could be starting to improve.

Read the full article at dodjit.com

Goldman Sachs vs. Intel

Tags:CIT,GS,Intel,Dollar,Forex
The U.S market continued to climb higher yesterday, as additional buyers drove the major indices to a positive close. Apart from economic data, Goldman Sachs and Intel both released their earnings reports, having an impact on the intraday session.

Goldman Sachs beat analyst’s expectations, showing increasing profits for the second quarter. Even though the results were positive, the stock failed to present a dramatic move, finishing the session with a gain of only 0.15%. Please note that the stock is currently trading around major resistance of $150, a level that could lead to selling pressure, should the indices fail to continue their recent rally.
Read the full article at dodjit.com

Has the S&P500 found Concrete Floor?

Tags: GS,Dollar, S&P500, IMF, Forex
Bullish traders jumped for joy during yesterday’s U.S stock session, as the S&P 500 managed to find some ground, bouncing off critical support. Even though certain stocks failed to present daily strength, further weighing on investor’s sentiment, the financial sector managed to pull the indices higher, as the sector closed with a gain of 6.4%. The banking industry was the leader of the day climbing by over 6.50% while REITs also received a boost, gaining by 4.38%. The S&P500 finished the session with a 2.49%.
Read the full article at dodjit.com

Dodjit's stock and Forex video briefing for 07 13 09

Dodjit's stock and Forex video briefing for 07 13 09

Adapt Your Trading Style

Tags: Dollar,  Euro, Technical chart analysis, Cad, Pound
  (Euro / Dollar) - Daily Chart

Direction of Trade (Long term):

Check Out  the full Technical Chart Analysis  at dodjit.com

Adapt Your Trading Style

Tags: Dollar, Boe, Euro, PPIP, Tarp
‘A stagnant situation can be boring for some, yet very profitable for others’

The U.S markets continued trade within range last week, closing Friday’s session at critical levels. News headlines had a major impact on the trading sessions, as U.S officials mentioned that they could be ready for round two, using further stimulus to combat the economic situation.

Tuesday’s session turned out to be the most volatile one, as the government released its PPIP program, another scheme which derives from the TARP program to help clear the toxic assets off bank’s balance sheets. Furthermore, President Barak Obama mentioned that another stimulus package could not be ruled out, especially due to the slow rate of recuperation.
Read the full article at dodjit.com

On 880

Tags: Dollar, 200 day moving average, Forex,BOE, Canada
Despite that fact Goldman Sachs helped to support the intraday session, leading the banking sector higher. The financial sector was the gainer of the day, closing the session higher by 1.26%. The loser of the day was health care, dropping by 1.26%.

To date the S&P500 is trading on its 200 day moving average around critical support. Even though Wednesday’s session presented increasing high selling volume and the daily candlestick formed a doji, showing the uncertainty in the markets, yesterday’s session failed to present any follow through. On one hand the 200 day moving average and the 880 support level could support the current price. On the other hand a bullish candle is required, for the index to hold above current levels. In similar scenarios, the markets tend to give way, if no buyers come into the market, driving the price higher.

Read the full articleat dodjit.com

Third Quarter has Started

Tags: Dollar, GBP, Alcoa
Alcoa’s results opened the third quarter yesterday, showing a loss of $454 million. The Aluminum Company stated that due to the decrease in demand of cars and construction, the price of aluminum had dropped severely throughout 2008-2009. Despite the heavy loss, the company did beat analyst’s expectations, therefore sending the stock higher. AA (Alcoa) closed the session with a gain of 4.12%

Read the full article at Dodjit.com

PPIP – sounds like some type of Morse code, no?

tags: PPIP , Dollar, USD/JPY,Pound
The news immediately spooked investors
knowing that further stimulus means further debt for the U.S economy.
In today’s market, the imbalance between government’s debts has reached
such an extreme that countries with surpluses are now concerned that
the U.S government will not be able to repay borrowed money. With a
current debt reaching approximately $11.7 trillion, many are worried
that another stimulus will put extreme pressure on the U.S, something
that could lead to further problems in the long term.
Read the full article at dodjit.com

Technical chart updates 07/05/09

  (Euro / Dollar) - Daily Chart

Direction of Trade (Long term):
See the full chart update at : dodjit.com

A Bump in the Road, or Signs Ranging Patterns

Tags : NFP , SPX, Dollar , Rate Decisions
From a line chart point of view, the
NFP result is still showing a gloomy picture but has managed to
distance itself dramatically from January’s lows, as certain sectors
have shown mild improvement during the second quarter. Last’s weeks
results showed that the current recession is far from over but didn’t
indicate that the situation is getting worse. One must note that
especially towards the beginning of a new economic cycle, employment
levels can present extreme volatility, bouncing up and down, as
companies hit by the recession’s impact continue to fault, while new
ones start to employ.

In addition, if we plot some technical
analysis on the NFP chart it we can see that the figures are still
above their prior lows. It will be interesting to see whether next
month’s result will manage to present a higher-low, regaining
investor’s confidence.
 

Read the full article at dodjit.com

Bounced Off the 200 Day Moving Average

Tags :


AUD
,


Dollar
,


RBA
,


Forex
From a technical point of view the broader market continues to remain in a range, lacking direction.





Read the full article at : dodjit.com

What is going to spark movement today?

Today’s
session could break the recent market boredom, especially due to the
vast amount of data being released. The two major events are going to
be the ECB’s interest rate decision and the
employment figures from the U.S. While the decision itself is going to
be an important one, something that could affect the Euro crosses, most
investors will scrutinize the ECB’s statement that will explain how
they plan to deal with their economy’s problems. Last time round the
ECB failed to present any major statement sticking to his previous
comments, regarding bond purchasing. One must note that since the ECB’s
last meeting certain sectors in the economy have shown mild
improvement, which could yet again lean Trichet to a more subtle
speech.

Over in the U.S, the unemployment rate is
expected to reach a whopping 9.6%, after presenting a 9.4% result last
month. Many are questioning the impact of this result, wondering if the
volatility will manage to break the indices and currency pairs out of
range, or whether the movements will only be a 1 minute thing,
especially as the 9.6% figure is already baked into the market’s price.

As
stated in numerous reports the markets are still holding around current
levels, even when analysts are now predicting double digit numbers.
With a 25 year high unemployment rate and continuing problems in the
economy, it will be interesting to see if further job losses will have
a negative impact this time round. One must note that should the result
diverge dramatically from the expected it could send investors back
into safe-haven assets.

Read the full article at dodjit.com

Are You Prepared?

A False Break on the Pound

On the Forex market the Dollar
index continued to trade around recent levels, regaining its strength
after a three day loss. An increase in volatility was felt during
yesterday’s session as the EUR/USD swung from side to side, while the
GBP/USD presented a false break.

Germany also had a mild
impact on the market, releasing its unemployment rate during morning
hours. The Euro-zone’s largest economy showed that their unemployment
problems could be improving, releasing a 31k result, compared to an
expected 44k. Even though the data had an immediate impact on the
EUR/USD, sending it higher, the major could hold on to its gains,
losing its steam throughout the session, as the negative U.S stock
session sent investors back into the Dollar.

The GBP/USD also
presented a volatile session as the revised GDP and the business
investment figures both showed negative results. The U.K showed that it
had shrunk by 2.4%, while the Business Investment dropped by -7.6%.
After climbing and presenting a break out at start of the session the
Pound reversed sharply heading back into range.  Yesterday’s session
was characterized by a false break, which ended dramatically lower. For
confirmation of a true break one should wait for a close above critical
levels.


Read the full article at dodjit.com
also avalible at dodjit and you tube, The economic fairy tale

 

The Economic Fairy Tale (Video Animation)

Dollar Continued To Lose Ground

Economic data and a lackluster
session in the stock market sent the Dollar index to lower ground. Even
though the index has broken out of its wedge formation, it is still
holding its current levels around 80 points. Consequentially, the
individual pairs are still failing to present any major movement.

The
AUD/USD and GBP/USD continue to remain around recent resistance levels,
while the EUR/USD, is slowly drifting higher. One must note that the
markets are now preparing for an interest rate decision from the ECB
therefore the intraday sessions could present high volatility.

Economic
data also had a mild impact on the session as mortgage approvals in the
U.K showed a better than expected result. Across the globe, Australia
showed that their private sector credit had dropped presenting a
negative 0.1%, while their HIA New Home Sales figure dropped by an
astonishing -5.7%.

read the full article at dodjit.com

The Dollar played dead

Despite a positive session in the U.S
the Dollar continued to trade in range, failing to present any major
movement. After presenting a positive session yesterday, today’s price
movement seems to be erasing all of those gains. The Dollar index
continues to remain in range trading around 80 points.

Mixed
data has been having an enormous affect on the currency market
recently, as traders remain confused regarding future price pattern.
For example what seemed like a Dollar continuation a few days ago,
quickly faded away, as Wednesday’s bond auction had an effect on the
Dollar, sending it lower. Yesterday’s U.S session is also affecting
today’s Dollar intraday session, sending it lower. While day traders
can work on the current ranges presented in the market, swing traders
should be patient and wait for a break of the current range. Individual
pairs, for example the GBP/USD and the EUR/USD, are all currently
trading in range.

Read the full article at dodjit.com

AUD/JPY Potential Setup

The AUD/JPY has been trading within an uptrend for over 5 months, presenting classic swing pattern. After retracing due to overall Dollar strength, this pair has now retraced to its Fibonacci level of 38.2%, a level which coincides with its lower trend line. Even though a potential bullish pattern is setting up, the trend is still trading within its secondary downtrend. A break of the red secondary trend line could signal a potential entry point.
Please note this scenario depends on today’s data and on the overall Dollar’s outlook
A change in bias will occur should the major trend line break

 

Read the full daily article at dodjit.com

Uncertainty on the FX market

Over on
the Forex market, the Dollar index continued to trade mixed, around
recent levels. Even though the Dollar weakened during yesterday’s
session, showing signs breakout, the index has retraced since then,
something that could lead to further consolidation. By taking a glance
at the following 4 hour chart one can see that the breakout’s momentum
from the triangle, has now disappeared as the index has retraced to
test its trend line. Please note a lack of movement on stocks, could
send the Dollar index into further range.

 

 

 
 On
individual pairs, a volatile session ended up to be a lackluster one as
most of the pairs ended up around previous levels. The GBP/USD
presented a doji candlestick showing that investors are still waiting
for a major event to decide where the currency pairs are headed. For
further chart analyses, feel free to view dodjit’s chart page.

Pound / Dollar - Daily Chart

(Pound / Dollar)- Daily Chart



Direction of Trade (long term):

EUR/USD makes a sharp turnaround

On the Forex market the Dollar
index continued to linger around recent levels, as currency investors
are preparing for today’s important rate decision. On individual pairs,
the EUR/USD presented a dramatic move, breaking key level of 1.4, after
finding support on its 38.2% Fibonacci level. From a broader
perspective, the chart now seems to be forming a cup and handle
pattern, currently trading in the handle stage. A break of upper
resistance will give a clearer picture and verify the completion of the
pattern.

 





On other pairs, the GBP/USD continued to trade around recent highs
while the USD/CAD closed the session just off trend line resistance.
Another market mover was the USD/CHF, dropping to 1.0657, the major
move came after the chart had formed a wedge pattern. The pair sold off
during the session as sellers pushed the pair down to support of
1.0691. Decreasing bond yields also had an impact on the pair, as the
movement in the bond market was negative for the Dollar.
Read the rest of the article at dodjit.com

Dollar didn’t budge

Even though equities presented a dramatic move during yesterday’s session, the Dollar
hardly moved, as the index continued to trade around its recent levels.
This type of price movement has now raised many questions regarding
further weakness in the equity market. From a fundamental point of
view, the Dollar has shown a strong correlation with the equity market,
increasing on market skepticism and decreasing, as risk appetite has
returned into the markets.

Could the Dollar index be telling us that the current drop in equities is only going to be a mild correction?

On
individual pairs the EUR/USD continued to trade above support of
1.3756, while the GBP/USD remained stuck between minor range of
1.6220-1.6621. The major mover of the day was the USD/CAD climbing
dramatically, as crude oil lost its ground. Even though the pair
smashed through its 61.8% Fibonacci level, presenting an enormous
rally, CAD traders should still be cautious as the price is now
approaching trend line resistance. In addition the recent trend did not
receive backing from broader Dollar strength.

Gold
continued to drift lower on expectation that inflationary problems
wouldn’t be an issue, while the bond market climbed higher, as money
exited stocks.

Market Data to Watch Out For

Unlike yesterday’s schedule eyes will focus on the economic
calendar today as a wave of data is scheduled to be released. Starting
with European data, Germany and France are scheduled to release their
manufacturing and services PMI, both expected to show an increase in
activity. Towards afternoon hours the U.S will take center stage
releasing its housing data. Existing home sales should have an impact
on today’s session as the market have priced in an increase of 4.81m
compared to a previous 4.68m


To view the full economic calendar click here.

The Dollar Stumbles, Where to Now?

From a technical point of view most
of the traded assets are now range bounded, waiting for a major event
to drive them forward, into trend. The Dollar index,
calculated against a basket of currencies closed the week stuck between
trend line support and resistance of 81.50 points. The non directional
week had an enormous impact on all the majors and the crosses, as
numerous pairs have now entered ‘sleep mode’, forming potential break-out setups.
One must remember that the Dollar is still showing a strong correlation
with the U.S stock market, as it continues to act as a safe haven. A
recent pause in stocks has been characterized by a stronger Dollar,
especially as investors are dubious regarding the continuation of the
equity market. Should equities break their range, one could expect a
weaker dollar and stronger counterparts.

This Upcoming Week

Even though the economic
calendar is a lot less packed compared to last week’s schedule, data
will continue to take its toll on the intraday sessions, causing
increasing volatility. The U.S will stand out this week as they are
expected to release an interest rate decision, their annualized GDP
result and consumption results, among others. While many are focusing
on the rate decision, one must remember that with a low rate of 0.25%
the Fed doesn’t have many alternatives that to help the economy via
further quantitative easing. Even though bonds are starting to price in
future rate hikes, the economic situation should prevent the Fed from
taking any irrational moves. Due to that fact one should look to other
results, for example housing data could be a potential candidate to
stimulate the break out. With a gloomy housing sector, could a
combination of Existing Home Sales and New Home sales spark the
break-out this time round?

Potential Break-Outs

(Please
note that even though we are pro bullish patterns the direction will
depend on the Dollar’s reaction to the U.S equity market)

USD/CHF


 
EUR/CHF


 
GBP/JPY


 
CAD/JPY
 

Check out our ‘charts analysis’ page, for technical charts.

Britain Surprises

On the Forex Market the Dollar index continued to linger around recent levels, as it closed at 80.23 points towards the end of the U.S session. BRIC
countries continued to have an effect on the Greenback mentioning that
a new reserve currency is now required, due to the Dollar’s status.
While news headlines have flooded the market over the last couple of
days with comments from Russian officials, those headlines are starting
to fade, especially as the topic will require a long process, something
that might not even be realized in the end.



From a technical point of view yesterday’s analysis on the Dollar index is still intact, as the Dollar continues to trade above trend line support and below major resistance.

Britain
surprised analysts during yesterday’s trading session with a better
than expected unemployment result of 7.2%. Even though the rate was the
highest since July 1997 the result beat analyst’s expectations of 7.3%,
providing the Pound with strength during the session.  According to
statistics the younger age group is feeling most of the pressure in
England due to the economic situation, finding it hard get employed.



The
EUR/USD also presented a volatile session increasing against the USD,
while the Dollar/ Yen pair finished the session flat. Movement on all
the pairs will occur once the Dollar receives a clearer direction.

Read the full article at dodjit.com

Dollar Doom?

Over the last couple of days the Dollar has been tip toeing on a thin line as BRIC
countries have been questioning its future as a reserve currency. While
certain members are extremely disappointed with the current value of
the Dollar, partly caused due the U.S’s enormous deficit, others are
still defending the greenback, mentioning that its status will not be
affected. One must note that many metals are still traded in U.S
Dollars; therefore oil exporting countries are being affected by the
Dollar’s devaluation. While there have been a lot of discussions
regarding the U.S Dollar, actions are yet to be take. In most cases, diversifying the world’s currency is easier said than done.


Consequentially the Dollar index has been treading water over the last
couple of days, after hitting resistance of 81.30 points. To date the
price pattern has formed a bullish triangle in a down trend. While a
breakout is often seen to the upside in this type of pattern,
additional pressure could be felt on the Greenback, leading it to its
recent lows.


 

On individual pairs the EUR/USD managed to find support early morning
regaining Monday’s losses, while the GBP/USD continues to remain around
recent highs. The U.K is expected to release its ILO unemployment rate
shortly, showing that the economy’s job loss rate has increased to a
whopping 7.3%. In addition Initial claims will show an increase and is
expected to come out at 60.0k. For further charts see dodjits.com chart
analysis page.

Read the full article at dodjit.com

Dollar’s strength was limited

On the Forex market the Dollar
index dropped after forming a doji like candlestick on Monday. The
index dropped below 80 points, climbing back into its recent trend. The
move was widely expected; especially as the risk for appetite has flip
sided over the last couple of months, sending carry trades and other
high yielders flying.

On individual pairs, the Euro/Dollar and the Pound/Dollar
both presented a reversal, climbing higher, while the AUD/USD climbed
higher after forming support on Fibonacci level 38.2%. Over in England,
political news was quickly brushed aside Wednesday morning as further
financial problems surfaced. According to Sky news, Lloyds banking
group will lay-off an additional 1500 employees that are located in
approximately 160 branches across England. Despite negative headline,
the GBP/USD continued to gain strength early morning backed by fading
political problems and improving housing data. As we recall Gordon
Brown managed to survive the labor party meeting the other day and
maintain his status. Even though the political saga is far from over,
investors are now looking past the problems, taking advantage of the
undervalued pound.

GBP/JPY possible setup

Even
though indicators are pointing to overbought conditions the price
pattern is now trading around resistance. Should the Pound receive
further strength and break the $160.80 level, bullish positions could
be an option. One must note that a break will depend on the Pound’s
overall momentum.



Read the full article at dodjit.com

dodjit Forex and Stock market video briefing

Dollar index formed a doji

Despite the relative strength on the Dollar,
the index presented a sharp turnaround during yesterday’s session as
counterparts gained intraday strength. The index failed to break
resistance of 81.12 closing the session just off its lows of the day.
Today’s session wasn’t much different, as the index formed a double top
during morning hours and yet again dropped, giving up further strength.








Daily Chart





*charts are courtesy of netdania.com



After a long and tiring meeting, Gordon Brown showed that he had
support of his fellow party members this morning, stressing that he
intends to make major changes regarding his political ways. Even though
the political problems are still far from being over in England,
investors took the news as positive thing driving the GBP/USD higher.
After four days of selling pressure on the Pound, investors took advantage of the pullback, driving the price higher.



The EUR/USD also received positive momentum during early morning hours,
after two days of heavy selling pressure. Germany’s trade balance
showed a slight improvement compared to the month before, but came out
just off analyst’s expectation at 9.4 billion. Exports have received a
major blow over the last couple of months as the global slowdown has
had an enormous affect on demand. Even though figures are showing that
exports are off their lowest levels, numbers are still very low
compared to the year before hand.

Read the full article at dodjit.com

Profit taking after Friday’s Dollar rally

On the Forex market the Dollar
opened mixed Monday morning climbing against the Euro, but decreasing
against the Yen. As explained on the weekly report, the Dollar
presented an enormous turnaround during Friday’s trading day, propelled
by a surge on yields on the higher end of the curve. (Further
information is explained in the weekly report).

The pound continued to take a hit Monday morning as political problems further weighed on the currency.
Even though the current correction isn’t yet signaling a change in
trend, the massive four day drop has now concerned investors,
especially as the U.K’s economy is still far from out of the woods,
politically and economically. The charts also showed a problematic
situation as the GBP/USD presented signs of a reversal candle on the
weekly chart. From a technical point of view the chart presented an
inverted hammer type candle stick, one that often points to further
weakness.
 


The
Japanese economy showed a slight increase early morning as the economy
released that bankruptcies had declined, allowing sentiment to rise.
According to Bloomberg news, the economy is now showing a dramatic
improvement something that is leading to improving confidence among
Japanese merchants. The Dollar backed down against the Yen Monday morning, but managed to hold most of its relative strength.

Read the full article at dodjit.com

Where to Now?

From a fundamental and historical point of view, the markets
should continue higher, especially due to Friday’s impressive NFP
figure. Friday’s immediate reaction from stock traders was to drive the
indices to higher ground. The result diverged by such an extent, from
analyst expectations, that throughout the session stocks lost their
steam as many questioned the surprisingly good report. On the Forex
market the Dollar index saw a dramatic change, as the
Dollar jumped against counterparts, the Dollar/Yen pair soared during
Friday’s session climbing by over 200 pips. While it might seem strange
that the Dollar increased against counterparts, especially as it has
acted as a safe-haven over the last couple of months, recent movement
came down to a combination of profit taking and higher U.S bond yields.

As mentioned above
Friday’s numbers gave the markets a green light regarding the strength
of the U.S economy. On one hand, currencies should continue on their
normal path, which means that the GBP/USD, EUR/USD and USD/JPY could
see higher ground in the long term. On the other hand, the Dollar could
gain strength in the short term as investors are now rushing into the
green back due to the following;

1. Traders
   are now pricing in a high chance of a rate hike, towards the end of the
   year- this is attracting foreign money into the Dollar.
2. Profit taking after Dollar counterparts presented an impressive rally.

Technical Pictures

The following chart present possible pullback areas considering the Dollar continues to strengthen.

EUR/USD


 
GBP/USD


 
AUD/USD
 

Check out our ‘charts analysis’ page, for technical charts.
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Will the NFP really have an impact?

Every first Friday of the month,
investors prepare for what is classed as the major mover of the month.
Over the last couple of months the NFP has received center of
attention, as the numbers have been showing less employment and higher
unemployment. Today during the U.S’s pre-market hours the Bureau of
Labor Statistics is scheduled to release its results, showing that the
unemployment rate has jumped to 9.2%, while the NFP has dropped by
-520k. Even though the two results are expected to have a large impact
on the intraday session, many are now questioning whether they will
have an impact on the overall trend. One must note the following:

• Certain sectors are starting to pick up, showing improving data
• According
  to expectation, the unemployment rate is expected to reach a double
  digit number. Is that already baked into the market’s price?
• U.S equities are still climbing higher.

For those of you who are day traders,
today’s session could present a dramatic move. Those who are more swing
traders should observe the price pattern carefully, watching for a
reversal on a daily chart, as the volatility could turn out to be only
a minor intraday thing.

Read the full article at dodjit.com

 

Dollar Bounces Back

On the Forex Market, the Dollar
reversed sharply, coming off support. As stated in previous reports, a
reversal was bound to happen, even if it ends up only being a short
one. One must note that 80 points on the index could act as resistance,
especially as the level is also classed as a psychological level.



On individual pairs the Dollar presented
a sharp turnaround during yesterday’s session, increasing against
counterparts. While certain pairs showed more of a move, the Dollar was
definitely a preferred currency during yesterday’s session. The EUR/USD
dropped due to the overall market strength and due to economic data.
GDP results showed that the Euro-zone had further contracted during the
first quarter, dropping by a whopping 2.5%. Yearly figures had more of
an impact on the market diverging from expectations, coming out at 4.6%.

U.K's
data surprised traders yesterday as their PMI reading jumped to 51.7,
the first increase in over a year. While it is far too early to
determine a change in the U.K’s economic status, the good news helped
prevent a major collapse on the GBP/USD. To date the Pound is trading
above its tertiary trend line, one that could act as support on the way
down.



Check out our ‘charts analysis’ page, for additional technical charts (only on dodjit.com).

Read the full article at dodjit.com

EUR/JPY soared above 137, will it continue?

The Euro drives forward

Risk appetite continued to drive the Euro forward during yesterday’s session as the Dollar weakened across the board. The Dollar index
dropped yet again during the session but quickly retraced towards the
second half of the day. Even though Dollar weakness is expected to
continue one should observe the price action, yesterday’s session
formed a hammer like candle, something that could present a short term
reversal. To date the Dollar index is trading around recent lows, a
level that could act as support, should equities fail to follow through
from yesterday’s session.


 
On other Forex pairs,
recent momentum continued with the AUD, GBP and NZD all climbing
higher. On yesterday's  video briefing  we mentioned a potential setup
on the EUR/JPY. It is important to note that even though the trade did
follow through climbing by over 200 pips, the pair has yet to break it
prior high of ¥137.40. While this pair is now presenting early signs of
a break of its current bullish triangle pattern, the equity market
should continue to be observed, as this pair, similar to others, will
continue to take its cue from stocks.

Crude oil continued higher, closing the session above $67 per barrel on overall market momentum and a decreasing Dollar.
Read the full article at dodjit.com

Dodjit forex and stock review

Dollar presented another leg down.

On the Forex market the Dollar
index dropped, coming close to December’s lows. A combination of a
higher equity and commodity market had a massive impact on the green
back during Friday’s session, esspecially as news headlines published
that crude oil and Gold had both jumped.

Gold
jumped by 2.04% during Friday’s session, while Crude Oil finished the
month above $65 per barrel. Even though the extreme rise is startling
some equity traders, especially as the current commodity moves are not
normally characterized during the start of an economic cycle, some are
relieved that the recent increase in prices isn’t yet having much of an
effect on inflation. Recent data is still showing that inflationary
numbers are decreasing in certain regions. According to last week’s
data the Euro-zone showed that their numbers had dropped during the
month of April.

On individual pairs, the Dollar continued to lose strength during early morning hours against counterparts. While the Forex market hasn’t presented any major moves volatility should start to pick up, especially as a vast amount of economic data is scheduled to be released.

Read the full article at dodjit.com

Interest rates could present the pull back

This
week’s trading sessions are going to be action packed, with Australia
scheduled first to take the stage. As all the central banks are
expected to hold this time round, intraday movements could present
traders with potential setups, especially for swing traders. In
addition to the rate decisions, GDP figures are expected to be released
in a few of the regions, while England will be releasing its inflation
numbers. Towards the end of the week the U.S will release the catalyst;
the NFP result- known to be a major market shaker. Non-farm payrolls
are expected to show a lower contraction compared to last month’s
figure while the unemployment rate is expected to jump to a whopping
9.2%.
It is important to note that even though the unemployment rate
has been increasing on a monthly basis, investors are pushing the data
aside, still heading back into riskier assets.
To view the full economic calendar click here.



 
Due
to recent price movement it now seems more important to ask when
economic data will start to show major improvement, giving the current
rally some major backing, driving it even higher.

Technical Analysis:

EUR/USD weekly chart




GBP/USD - weekly chart



AUD/USD- Weekly Chart



USD/JPY- Weekly Chart



*all charts are courtesy of netdania.com

*Powered by etoro.com

Read the full article at dodjit.com

Heading for a Chapter 11? | forex trading

The Pound is clinging on to $1.6

Even
though the economic calendar was relatively light on data yesterday the
various Forex pairs still presented a volatile session. The Dollar Index
jumped higher after three days of treading water, climbing to 81
points. One must note that the 80 point level will act as a
psychological support level, especially as the 80 points acted as a
critical pivot point in the past.

The Pound/ USD
continued higher though early morning hours but retraced after finding
resistance around $1.6. Today session started in a bearish mood as
sellers came back into the market. Even though indicators are showing
dramatic signs of overbought levels, current market conditions could
send this pair higher in the long term, especially as certain analysts
are still classing the pound as undervalued. Recent trend line
resistance could act as support on the way down, allowing bullish
traders more comfortable entry points.




The USD/JPY presented a massive turnaround during early morning hours
climbing by over 100 pips.  The main reason for the climb was risk
appetite as investors from across the globe, sold the low yielding
currency to buy the USD Dollar. According to recent comments from
Treasury Secretary Timothy Geithner, the economy is
making progress and “credit is starting to ease a bit”. According to
Bloomberg news; the U.S government’s current rating is still stable
despite recent problems in the economy.
Read the full article at dodjit.com

Will the EUR/GBP drop?

On the Forex Market the Dollar
index lost its strength during the session, as investors rushed back
into riskier assets. While there weren’t any major moves on the FX front, currency pairs continued to linger around critical levels, showing potential breakouts.

Over the last couple of weeks, the Euro and the Pound
have received a major boost as a higher equity markets have boosted
confidence among investors. While both economies are still showing a
dire situation, recent bank statements are mentioning that 2010 could
present a completely different picture.

While both the economies seem to be dealing with never ending problems, the Pound
has strengthened the most over the last couple of week despite a lower
yielding return. When observing the relative strength between the two,
one can see that the Pound has gained more in real value compared to
the Euro. From a trading point of view the EUR/GBP has dropped by an
enormous rate and is now trading on major support of 0.8740. One must
note that a clear break is required for short positions, especially as
the price pattern presented a false in the past.



Read the full articl at dodjit.com

 *courtesy of netdania.com