User Name: Password:      Register - Lost password?

Forex News Blog
Back to The Headlines
Wednesday December 12, 2007 - 22:31:08 GMT
Forex.com - www.forex.com

Share This Story:
| | Email

Forex research- Past Week in Perspective

The USD is closing the week largely unchanged against most major currencies, but the dollar did manage to sustain the break-out from its downchannel in the US dollar index from last week. That breakout, led by gains in USD/JPY last week, was augmented by EUR/USD dropping out of its primary up-channel dating back to mid-August. Follow-through on the break lower, however, was cut short by exceptionally hawkish rhetoric from ECB Pres. Trichet, who went so far as to indicate that some ECB central council members favored a rate hike at this week’s meeting. The biggest loser against the USD was GBP, which plunged on weaker service sector and housing data ahead of the BOE ¼% rate cut, which was correctly forecast in last week’s report. Even the Canadian dollar managed to recover a lot of lost ground following the ostensibly surprising Bank of Canada ¼% rate cut, which was also correctly suggested in last week’s report.

The general lack of upside follow-through for the USD is disheartening for USD bulls to say the least, but not unexpected given that the Fed is expected to lower rates next week. Rather than an abrupt reversal to the upside for the USD, it’s becoming increasingly apparent that the USD is transitioning into a consolidation phase with on-going potential to see further modest gains. The buck’s fortunes are also not equal against other major currencies, to be sure. In the very short-run, I favor further upside for the USD against GBP (lower GBP/USD) and JPY (higher USD/JPY), but greater sideways trading in EUR/USD, AUD/USD and USD/CAD.

The market has been very fickle of late, and this is not uncommon going into the end of the calendar-year, when speculative positioning is typically reduced and liquidity tails off, leaving directional moves with limited follow-through. Risk appetites have increased as the US data indicates a slower, but not recessionary, outlook ahead. Carry-trades (long JPY-crosses, e.g. long EUR/JPY) were put back on in quick fashion after the ADP national employment report surprised sharply to the upside. The strength in the ADP was not fully mirrored by Friday’s NFP, but the +94K reading was sufficient to convince investors that the world was not crumbling. Market expectations for next Tuesdays FOMC meeting, which have been exceptionally volatile, have settled back in favor of a roughly 75% likelihood of a 25 bp ease/25% chance of a 50 bp cut, according to Fed Fund futures on Friday afternoon.

There is also a very good chance that the Fed will cut the discount rate by more than the Fed Funds target rate (FFTR), further reducing the spread over the target rate. A discount rate cut of 50 bps is likely if the Fed determines that money markets, due to credit risk aversion, are unable or unwilling to pass along the rate cuts the Fed is delivering. By lowering the discount rate more than the FFTR, the Fed will get the discount rate sufficiently below LIBOR lending rates to generate discount window borrowings that are in turn lent out in LIBOR money markets, conceivably un-freezing inter-bank lending. The Aug. 17 discount rate cut failed to inspire significant borrowing back then, due to banks’ unwillingness to lend to each other on credit concerns, and not much has changed in the meantime, so there is no guarantee another discount rate result would have the desired results. Still, I’m expecting the Fed to cut the FFTR by ¼% to 4.25% and lower the discount rate by ½% to 4.50%. Should the twin rate cuts be delivered, I expect to see equities rejoice and risky assets to perform even better, likely vaulting JPY-crosses higher in the process. A lone 25 bp cut to Fed funds, on the other hand, would leave equity markets thirsty and desperate for more, likely leading to a sharp decline, with consequent downside fallout for JPY-crosses, and a slightly USD positive reaction against all but the JPY.

Regular readers of this report are aware that I have been expecting US weakness to eventually cycle around to other major global economies, leading to slower growth elsewhere and lower rates, as the most likely source of USD rebound. That picture, delayed by several months now, is finally starting to develop. The clearest evidence was the rate cuts by the BOC and BOE, but the ECB (via Trichet) managed to throw a stiff-arm into the approaching tackler. Trichet’s hawkish press conference struck me as a rhetorical effort to embellish the ECB’s credibility, but incoming data and revised outlooks continue to suggest that the ECB will remain on hold, before being compelled to lower rates in the middle of 2008. In particular, pay attention to revised outlooks from the IFO and IfW economic institutes in Germany on Thursday next week, with downward revisions likely to weigh on the EUR.

I have also been cautioning traders to be on the lookout for a shift by German officials on the strength of the Euro. In recent months, the Germans have been the main obstacle to Eurozone officials pressing the G7 to take a more convincing stand that the USD is too weak and the EUR too strong. We got that shift this week when German Fin. Min. Steinbrueck indicated that he would bring the issue up at the next G7 meeting in February. The other side of that coin is for US Treasury Sec. Paulson to make a more concerted effort to push the ‘strong dollar’ policy, and there has also been movement on that front. Paulson has lately been talking more about the strong fundamentals of the US economy and the expectation that the USD would eventually reflect this strength, likely increasing his receptiveness to including language in the communiqué to suggest that the USD is not reflecting economic fundamentals. Together, these developments suggest that EUR/USD upside is limited over the next several weeks, and that strength should be sold.

Turning to the data coming out of the US next week, Monday sees only Oct. pending home sales. Tuesday sees Dec. IBD/TIPP economic optimism and Oct. wholesale inventories, followed by the FOMC rate announcement in the afternoon. Wednesday sees weekly mortgage applications, the Oct. trade deficit, and Nov. import price indexes. Thursday sees weekly jobless claims, Nov. PPI and Nov. advance retail sales, which will be the key report to watch. Friday finishes up with Nov. CPI, industrial production and capacity utilization.

Eurozone data on Monday sees German Oct. trade balance, French Oct industrial production, and the Dec. Sentix Investor Confidence gauge as the main reports. Tuesday sees German Nov. wholesale prices and the Dec. ZEW economic sentiment index for Germany and the Eurozone, another important forward-looking indicator. Wednesday sees 3Q Eurozone employment data and Oct. Eurozone industrial production. Thursday sees French and Italian Nov. CPI reports and 3Q Eurozone labor costs. Friday sees final Nov. German CPI and Nov. Eurozone CPI.

Japanese data begins on Monday morning with Oct. machine orders and bank lending data, followed in the afternoon by the Nov. Economy Watchers survey of small consumer firms. Tuesday afternoon sees Nov. consumer confidence. Wednesday morning sees Nov. corporate goods price index and the Oct. current account/trade balance. Thursday sees final Oct. industrial production in the afternoon. Friday’s highlight will be the 4Q Tankan survey of corporate sentiment from the BOJ, with all the indexes expected to register declines, as private consumption slows and the global growth outlook deteriorates.

UK data on Monday sees Nov. PPI and Oct. DCLG house prices in the morning followed by Oct. leading economic indicator in the afternoon. Tuesday sees the Oct. trade balance. Wednesday sees Nov. employment data and Oct. average earnings report. Thursday sees the Nov. RICS house price balance and the Dec. CBI industrial trends survey.

In Switzerland, the SNB will announce its interest rate decision on Thursday and no change to the 2.75% mid-rate is expected.

 

Forex Trading News

Forex Research

Daily Forex Market News
Forex news reports can be found on the forex research headlines page below. Here you will find real-time forex market news reports provided by respected contributors of currency trading information. Daily forex market news, weekly forex research and monthly forex news features can be found here.

Forex News
Real-time forex market news reports and features providing other currency trading information can be accessed by clicking on any of the headlines below. At the top of the forex blog page you will find the latest forex trading information. Scroll down the page if you are looking for less recent currency trading information. Scroll to the bottom of fx blog headlines and click on the link for past reports on forex. Currency world news reports from previous years can be found on the left sidebar under "FX Archives."



Elevate Your Trading With The Amazing Trader!

The Amazing Trader includes:
  • Actionable trading levels delivered to YOUR charts in real-time.
  • Live trading strategy sessions.
  • Market Updates with Trading Tools.

Register To Test Your Amazing Trader


Trading Ideas for 23 October 2017

Register for the Amazing Trader

1.

Amazing Trader EVENT RISK Calendar:

Tue 24 Oct
All Day flash PMIs
Wed 25 Oct
01:30 AU- CPI
08:00 DE- IFO Survey
08:30 GB- GDP
14:00 CA- BOC Decision
14:30 US- EIA Crude
Thu 26 Oct
11:45 EZ- ECB Decision
12:30 US- Weekly Jobless
14:00 US- Pending Homes Sales
Fri 27 Oct
12:30 US- GDP
14:00 US- final Univ of Michigan

Forex Trading Outlook


Potential Trading Opportunities


  • POTENTIAL PRICE RISK: Medium Tue-- All Day Global flash PMIs. First good look at October economic performances.



  • POTENTIAL PRICE RISK: HIGH Wed-- 01:30 GMT AU- CPI. Top Inflation indicator.

  • POTENTIAL PRICE RISK: HIGH Wed-- 08:00 GMT DE- IFO Survey. Top German indicator.


  • POTENTIAL PRICE RISK: HIGH Wed-- 14:00 GMT CA- BOC Decision. No Policy Change Expected.


  • POTENTIAL PRICE RISK: Medium Wed-- 14:30 GMT US- EIA Crude. Top Weekly WTI Statistic.



John M. Bland, MBA
co-founding Partner, Global-View.com

EXCLUSIVE: Global-View Daily Trading Chart Points Updated

EXCLUSIVE: Global-View Free Forex Database updated




TRADER ADVOCACY ARTICLES

Trader's Advocate Articles..

pic

Retail Forex Brokerage Changing!

Are you looking for your first broker or do you need of a new one? There are more critical things to consider than you might have thought.

We were trading long before there were online brokers. Global-View has been directly involved with the industry since its infancy. We've seen everything and are up-to-data with recent regulatory changes.

Our Best Brokers listing section includes:Forex Broker Reviews, Forex Broker Directory, Forex Broker Comparisons and advice on How to Choose a Forex Broker

If would like guidance, advice, or have any concerns at all ASK US. We are here to help you.

SEE Our Best Brokers List

Currency Trading Tools

  • Live rates, currency news, fx charts. 

  • Research reports and currency forecasts.

  • Foreign Exchange database and history.

  • Weekly economic calendar.

Directory of  Forex trading tools

 
Terms of Use    Disclaimer    Privacy Policy    Contact    Site Map


Forex Forum
Forex Trading Forum
Forex Forum + forex rates
Forex Forum Archives
Forex Forum RSS
Free Registration

Trading Forums
Currency Forum Guide
Forum Directory
Open Forum
Futures Forum
Political Forum
Forex Brokers
Compare Forex Brokers
Forex Broker News
Forex Broker Hotline

Online Forex Trading
Forex Trading Tools
Currency Trading Tools
Forex Database
FX Chart Points
Risk/Carry Trade Chart Points
Economic Calendar
Quicklinks to Economic Data
Currency Futures Swaps
Fibonacci Calculator
Currency Futures Calculator

Forex Education
Forex Learning Center
FX Trading Basics Course
Forex Trading Course
Forex Trading Handbook

Forex Analysis
Forex Forecasts
Interest Rate Forecasts
Central Bank Forecasts

FX Charts and Quotes
Live FX Rates
Live Global Market Quotes
Live Forex Charts
US Dollar Index Chart
Global Chart Gallery
Daily Market Tracker
Forex News
Forex Blog
Forex News
Forex Blog Archives
Forex News RSS
Forex Services
Forex Products
GVI Forex
Free Trials
FX Bookstore
FX Jobs and Careers
Jobs USA
Jobs UK
Jobs Canada

Forex Forum

The Global-View Forex Forum is the hub for currency trading on the web. Founded in 1996, it was the original forex forum and is still the place where forex traders around the globe come 24/7 looking for currency trading ideas, breaking forex news, fx trading rumors, fx flows and more. This is where you can find a full suite of forex trading tools, including a complete fx database, forex chart points, live currency rates, and live fx charts. In addition, there is a forex brokers directory where you can compare forex brokers. There is also a forex brokers hotline where you can ask for help choosing a forex broker that meets your individual fx trading needs. Interact on the same venue to discuss forex trading.

Forex News

The forex forum is where traders come to discuss the forex market. It is one of the few places where forex traders of all levels of experience, from novice to professionals, interact on the same venue to discuss forex trading. There is also the GVI Forex, which is a private subscription service where professional and experienced currency traders meet in a private forex forum. it is like a virtual forex trading room. This is open to forex traders of all levels of experience to view but only experienced currency tradingprofessionals can post.

Currency Trading

Currency trading charts are updated daily using the forex trading ranges posted in the Global-View forex database. You will also find technical indicators on the fx trading charts, e.g. moving averages for currencies such as the EURUSD. This is another forex trading tool provided by Global-View.com.

Forex Brokers

The forex database can be used to access high, low, close daily forex ranges for key currency pairs, such as the EURUSD, USDJPY, USDCHF, GBPUSD, USDCAD, AUD, NZD and major crosses, including EURJPY, EURGBP, EURCHF, GBPJPY, GBPCHF and CHFJPY. Data for these currency trading pairs dating back to January 1, 1999 can be downloaded to an Excel spreadsheet.

Forex Trading

Forex chart points are in a currency trading table that includes; latest fx tradinghigh-low-close range, Bollinger Bands, Fibonacci retracement levels, daily forex pivot points support and resistance levels, average daily forex range, MACD for the different currency trading pairs. You can look on the forex forum for updates when one of the fx trading tools is updated.

FX Trading

Global-View also offers a full fx trading chart gallery that includes fx pairs, such as the EURUSD, commodities, stocks and bonds. In a fx trading world where markets are integrated, the chart gallery is a valuable trading tool. Look for updates on the Forex Forum when the chart gallery is updated.

Forex Blog

Global-View.com also offers a forex blog, where articles of interest for currency trading are posted throughout the day. The forex blog articles come from outside sources, including forex brokers research as well as from the professionals at Global-View.com. This forex blog includes the Daily Forex View, Market Chatter and technical forex blog updates. In additional to its real time forex forum, there are also Member Forums available for more in depth forex trading discussions.

 

WARNING: FOREIGN EXCHANGE TRADING AND INVESTMENT IN DERIVATIVES CAN BE VERY SPECULATIVE AND MAY RESULT IN LOSSES AS WELL AS PROFITS. FOREIGN EXCHANGE AND DERIVATIVES TRADING IS NOT SUITABLE FOR MANY MEMBERS OF THE PUBLIC AND ONLY RISK CAPITAL SHOULD BE APPLIED. THE WEBSITE DOES NOT TAKE INTO ACCOUNT SPECIAL INVESTMENT GOALS, THE FINANCIAL SITUATION OR SPECIFIC REQUIREMENTS OF INDIVIDUAL USERS. YOU SHOULD CAREFULLY CONSIDER YOUR FINANCIAL SITUATION AND CONSULT YOUR FINANCIAL ADVISORS AS TO THE SUITABILITY TO YOUR SITUATION PRIOR TO MAKING ANY INVESTMENT OR ENTERING INTO ANY TRANSACTIONS.

Copyright ©1996-2014 Global-View. All Rights Reserved.
Hosting and Development by Blue 105