USD Relevant Adjustment with Foreign Currency Rates

In Search of Equilibrium in a Time Line

After confirming a bearish market call on the USD since the start of the 2nd quarter, the registered low @93.88 bp still serves as the initial support for the DXY. Upon doing our due diligence, the outlook for the DXY would be for a wide daily consolidation within its trading range until such time another catalyst emerges in the market. 

DXY Weekly Chart May 13, 2015

There are several surrounding factors that keeps market price swings at current levels. However, these price adjustments are well within our market call and the same due diligence on global exchange rates' equilibrium levels & self-adjusting into these market conditions after a round of rate cuts by major central banks  interest rates. China's two consecutive moves on the RRR and the recent rate cut have been considered by us as a market neutralizer after the RBA did the same beforehand. Where further stimulus are meant to prevent China's economy to deepen from their current situation.

For now, the directional trend for a weaker USD continues until such time it says otherwise. The consolidation may remain in tight ranges while a declining formation would be intact in a technical perspective along side a variable time cycle before the USD pivots back to higher grounds. The assumption would be correlated to the USD rally that took place well within 7 months to achieve a relative high for the USD. 

With that said, to consider a variable time line that the USD would do the same on the flip-side with a specific price level will have to be defined based on this analysis. And on top of this case scenario, is to find the relevant signal where the probable disconnect of the USD outflow of investors from the current market conditions of the Dow Jones as an additional indicator for such occurrences within the time line. In essence, due diligence is a must to come up with a well informed trading decision. More to follow related to this subject matter.

Since in today's global information network is well in place, most sophisticated investors and traders are more self-directed with the information available. What is more important is knowing and be properly guided with the right directive information applicable and meets their trading criteria before any trade execution. 

Is Hedging an Asian Stock Portfolio Equally important knowing the US DOW declines Triple Digits?

Every time the US Dow Jones Industrial Average (DJIA) declines equivalent to or more than 1.26% considered to a triple digit decline, would definitely be another blow for Asian stock markets by the time it opens. 

Under these circumstances; what can main-street investors in Asia do to take pre-cautionary measures and strategies knowing that the day markets open that a huge decline would be expected? As we know that Asian stocks do mimic or does follow the major US markets. And by having access to both primary and secondary markets should be made available for investors to at least be able to arbitrary hedge and/or be advice by their respective fund managers as to how their portfolio investments could be protected whenever such movements are made while their respective markets are closed.

      Access to primary Markets for Asian Main-Street Investors

Relevant Structure of Price & Time Elements

On Gold & USD Index Trend Direction: A mix read in the market fundamentals would stall price action until the day ECB Mario Draghi speaks other than the Jobs report which will culminate price action at the end of the week's trading.

For now, encouraging reports on China has fueled optisim and Russian President Vladimir Putin backing down rhetoric comments have sent positive reactions even providing a relief recovery for the Ruble. The Russian Ruble has had its share of extreme volatility, not only affected the Micex, but clearly Russian investors in the international market. Click here

Market Perspective: EURGBP CROSS RATE

Fundamental: British Pound (GBPUSD)

The UK services sector continues its growth rate at a robust pace, with the UK October PMI Non-Manufacturing index at 62.5. the highest registered rate reading in 17 years. Likewise, the best quarterly performance showed within its 16 year period in the third (3rd) quarter of this year 2013. At this pace, expect overall wages in this UK sector and industry to move higher as job growth will strongly register and should also be able to meet the demands of production requirements.

• The UK PMI Services was the strongest figure in 17 years (Cable Positive).
• The market investors & major participants await ECB on Thursday Nov. 07, 2013
• Price Action Spill-over into EURGBP & GBPJPY cross rates

FundamentaL: Euro (EURUSD)

• Euro-Zone Manufacturing PMI (OCT.) likewise confirms expectations.
• EURUSD price action holds slightly to lower while pacing behind Cable prices.
• Thursday’s ECB meeting has kept investors & traders at bay.

The final revision of October’s Eurozone’s Manufacturing PMI final figure have finally confirmed its estimate for the month of October. The increased figure to 51.3 from 51.1 in September have not spilled over as much as the effects in prices in the Cable foreign exchange market. Whereas both reports are practically net positive for both European majors as a sign for growth and vote of confidence in the factory sectors remains good in the remaineder of the year.

Market Perspective: EURGBP CROSS RATE

T-ANGLE: MAJORS & CROSSES -GBPUSD-GBPJPY-AUDUSD-EURUSD

After dissecting market reports from last week's trading activity & comparing price action based from our market perception, the end-result by making a market call for the USD debacle to continue its course lower have been confirmed.

The market perception then was a short-live corrective move higher which was suported with mix reports from the market place that registered a week's high @82.50 ending August 02, 2013. This was the result of the 2 day opening trading activity for August which overlap with the end of the week's trading for July as well.

MegaTrade101.com T-ANGLE: MAJORS & CROSSES

The Strategy of Relevance trading:

USD DOLLAR INDEX VS. EURO DOLLAR INDEX

The Best known Open ‘SECRET’ of Foreign Exchange Trading is the ' US Dollar Index ' as known in the industry as the DXY symbol or the DXc1- continues technical data on the value of the US dollar traded and measured from a basket of major foreign currencies. And the EURO Dollar Index, better known as the anti-US dollar in the industry.

It is a trade weighted average or a geometric means of the US Dollar's value against the Euro, which is the currency used by the unified group of European nations, the Japanese Yen, the Pound-Sterling known as the GBP, Canadian Dollar, the Swedish Krona and the Swiss Franc. Each currency has an equivalent value or percentage share to the composition of the US dollar index as it is traded in the Inter-Continental Futures Exchange at the New York Board of Trade. Please refer top chart comparison. Click to continue

MegaTrade101.com - The Art of Trading the Foreign Exchange Market with Confidence - The Strategy of Relevance trading: