Sunday, February 27, 2011

Market Analysis

The transitional period for the Forex market particularly for the USD passive recovery has been extended as shown on the weakness of the USDX still below the 78.05 level. Although, the slight retrieval from last week's closing have given some sign of relief as most major players were hesitant to push it further by simply taking long positions either on the GBPUSD or the EURUSD. based on our previous market view analysis that the slow ladder-like recovery for the USD would be towards the end of the 1st quarter. As the 74.25-76.80 support range is still viably supportive on a technical stand point as of this writing.
The direction of the USD would be determined by the report on the Non-Farm Payroll numbers and unemployment data due this week. However, the determining factor before the reports would be the Middle-east situation where money flows well over the commodities market in oil trading for the past few weeks now. Until a more solid resolution other than the sanctions held by both the US and UK would still not be enough for investors to change any immediate sentiments. As they would normally say...go where the money flows.
The Euro and Pound's rally for the past week have been anticipated in spite of a mixture of reports in the market. As investors market sentiments and trades were focused on the oil accelerating over the $100.00/bl. level. Though some corrective moves were made but the continuing tensions over at Libya and parts of the Middle-East has made this transitional move for the USD to start. No such momentum has been building as volumes are seen over at the commodities market.
We remain true to our market analysis for now not as a bias opinion but simply it does take more time to ignite a sluggish US Dollar with oil rising and Gold at the back-drop of the fundamentals. However, the month of April should prove to be quite interesting if and when our time table on market projections would coincide with the market movements.

Monday, February 21, 2011

Transitioning Forex Market

The Foreign Exchange Market has long been in transition period over the past weeks where price action and volatility has been deawn directionless on an intraday basis. Why we say this is because for the past few weeks price actions only reaches its peak upon release of economic data. True enough, that some speculative trades have been slowly deteriorating. This is equally true where the previous report from JP Morgan shows exactly the Forex volatility have decreased over the past few years.
Others may disagree, nevertheless the fact remains that the only increase on volatility can be found by the middles of each week's trading. Moreover, the upcoming reports on US Consumer Confidence may yet to prove to be friendly to the USD in spite of its vulnerable low price levels. The USDX at the 77.65 basis point; or below the significant 78.05 has been bearish. Giving a renewed tone for both the Euro and the British Pound.
Currently working at the 1.3580 and 1.6155 levels for both pairs has resulted to a mix corrective move on a daily basis. Although, the near term trend still remains intact to move higher is there, but the steam of loosing its rally thereafter would hold a possible USD short term recovery towards the end of the 1st quarter of the year. The USD short term recovery may lead other major players to adjust their respective positions for the quarter that may lead to further losses along the way on a weekly basis. As indicated by its relative cross rate of EURGBP re-testing its lower band between its HI/LO indicators. And this has been the overall scenario on a more technical analysis of how the current market behavior has been seen. We remain bearish for the near term especially for the EURGBP cross rate from our previous market view report. As the transitioning period from the recent EURO rally would turn into a bearish market. No specific dates; however we do advice to carefully watch the Cross rate price movement between the three (3) winning pairs to loose ground towards the next couple of weeks, if not earlier than most would expect becasue this is the true nature of trading the foreign exchange market. " Expect the unexpected, during unexpected times."
The mere fact that Japan's Sakikabara the know to many as Mr Yen have indicated that the USDJPY may be seen below the 80.00. Which leads us to believe that such a trade strategy could occur and simply contradict his statements. This however, remains to be seen and speculated upon.
Refer to our complete analysis report in our website at http://www.megatrade101.com/

Monday, February 14, 2011

Market Outlook Ahead

Ironically, the market would have reacted more with the current market conditions with oil moving lower at USD 85.00/bl. levels, Gold just about making an attempt to move higher together with the positive tone for the USD. Where we could find the USDX at the 78.75 basis point attempting to stay positive with78.05-80.25 trading range as the first initial target.
On the fundamental stand point, the Obama speech on cutting the deficit back down over a period of 10 years has been the back-drop together with a better outlook for US interest in Egypt in the near-term has helped propelled a slow recovery for the US dollar. It would stay within a certain trading range as it tries to slowly build momentum towards the end of the first quarter and middle of year particularly for the first week of April. this is where most of the position adjustments takes a heavier toll as the 1st quarter market sentiments would spillover the first two months of the 2nd quarter. A better valuation where the stock market would be priced in fair value compared to the first opening month of the year.
With that said, the rest of the majors would be making its corrective movement lower . To start with would be the Euro and the British Pound. More influential would be the cross rate of the EURGBP where it is currently showing its weakness more and building down to it previous lower levels. The 0.8330 would be the first target objective to be attempted sooner than later. On the technical front would be described on our complete report on our website at: http://www.megatrade101.com/

Tuesday, February 8, 2011

The 3 Winning pairs!

On a fundamental stand point, there are only three (3) major highlights to be concerned about namely, the Australian Unemployment report, the Bank of England rate decision and again, Friday's University of Michigan Confidence numbers. Other than the back-drop of news surrounding the Foreign Exchange and the commodities markets particularly the oil and precious metals has had no immediate impact to the deteriorating US Dollar.
Whereas, the USDX has remained above the achieved target level of 76.80/90 range as mentioned in our market view analysis last week that a re-test would be attempted. Currently at 77.84; its indecision to move in either direction have shown that market sentiments is on a wait and see attitude. However, the previous week's candlestick configuration indicates a corrective move upwards as expected by most traders. The FX market price movements have been favorable to most mid-term trade strategies rather than for day traders who would be more impatient to find the next big trading range. Thus making short-term traders do more by scalping the market with a few 10-20 pips and surprising making retail brokers make more than usual. No problem with that, its how they make their revenue from.
However, the general outlook for the Euro and Pound other than fundamentals would still be the continuing efforts made by the current players on the EURGBP cross rate. Currently, breathing a positive tone of 0.8442 as compared with the EURUSD at 1.3639 and 1.6149 for the GBPUSD respectively. The previous week's capped of 1.3880 as indicated is still the numbers to watch for the Euro which is supporting the cross rate as of this writing.

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