Forex Market Talk Archive

Tuesday, March 16th, 2010

After yesterday's dollar strength against all pairs the market will have an excuse to sell off the dollar based upon today's U.S. fed statement.

The AUDUSD is on track to push above .9200 to set up a major shorting opportunity. The EURUSD could push towards 1.39 in the coming days.

We believe this bout of dollar weakness will be short lived possibly into late this week early next before the USD reasserts itself taking the EURUSD back down towards 1.3100

Monday, March 15th, 2010

Reflecting on Global equity markets at, through or pushing to new 52 week highs there is a notable exception Shanghai. This is particularly significant for the commodity based currencies AUD & CAD.

The China miracle is set up for a fall as inexperienced and embryonic central bank machinations leave the door open for a blunder.

The U.S. Fed has a 100 years of experience in manipulating money supply, bank reserve requirements and interest rates and has blundered plenty despite the many cycles they have been through. So, isn't it possible the new big kid on the block in his new car with much less mileage under their belt may push too hard on the accelerator and then slam the brakes too hard.

My contention is the relative weakness of the Shanghai index which peaked in November and may be in the middle of a failing rally as the FTSE & S&P forge into new high ground is a warning shot across the bough.

Since China's expansion has fueled the bull markets in natural resources which has benefited the AUD a contraction of that demand would reverse money flows into AUD. Our work is projecting a significant high in the AUDUSD between 92.25 to 92.80 and then a major slide to 86.00 minimum.

Friday, March 11th, 2010

EURUSD broke through key resistance at 1.3730 and must be respected till it closes back beneath, potential upside 1.4040.

USDCAD has cleaned out last years low at 1.0205 while AUDUSD barely penetrated this week high and we are alert for topping signals.

USDJPY is the laggard barely higher on the week and remains a short candidate with objectives at 87.30

Monday, March 8th, 2010

Most analysts have turned constructive the USDJPY after last weeks 200 pip surge, although the price surge was fast and furious it smacks of a bear market rally.

As of this morning, last nights high of 90.66 is 61.8 back from the recent high of 92.11 to last weeks low of 88.13. This leaves the door open for this being a false start with shorts blown out and an 87.30 objective still being possible.

We favor shorts with stops above 90.80 as last Thursday's and Fridays push leaves air-pockets below.

Friday, March 5th, 2010

Yesterdays 100 plus pip rally in the the USDJPY could very well mark the bottom for a sustained move to 96.00.

We will be looking for an entry on a pullback to the 88.65-55, which is the previous low that was violated to shake out USDJPY bulls.

The EURUSD has violated the rising wedge on the hourly pointed out yesterday and has given back 150 pips of the 300 pip rally increasing the odds for a complete retest of the low at 1.3434 

The AUDUSD showed the first sign of an impending high selling off 100 pips, we are attentive for a failing rally or a new high above .9080 for stepping into short positions.

With the NFP due out this morning keep in mind the adage " People who buy headlines today, sell newspapers tomorrow"

Thursday, March 4th, 2010

It is our philosophy to go into a big market moving number flat (without positions) because we are traders or speculators not gamblers.

Attempting to predict a market reaction to the U.S. Employment report is more like roulette with a red or black bet on the release of this news.

Charts do not apply at least for the initial response therefore we respond to the reaction rather than forecast it.

Yesterday's commentary still applies as this news could be the catalyst to drive FX markets to those setups.

A quick review, looking for USDJPY to trade 87.60-30 for a major buying opportunity, USDCAD for a buy towards 1.0160 and AUDUSD a short which is the weaker of the two commodity currencies when USDCAD hits downside targets.

Wednesday, March 3rd, 2010

Now that USDJPY longs have been washed out under 88.55 we feel the final stages of this correction are at hand and a position long is within striking distance at the 87.60 to 87.30 zone in the coming days.

The commodity currencies USDCAD & AUDUSD relative strength is waning and shorts are setting up with AUDUSD demonstrating relative weakness with non confirmation divergences on the hourly chart.

The EURUSD has the look of a rising wedge on the hourly, which implies a complete retrace of the two day recovery.

Tuesday, March 2nd, 2010

The EURUSD as forecast took out the stops under 1.3451 which had held to the pip on the last two consecutive Friday's.

As expected the momentum at the new low of 1.3434 posted a non-confirmation and divergences on the hourly and more significantly the daily chart.

This now leaves the door open for a bear market rally in the EURUSD to correct the 1700 pip decline, a 38.3 Fibonacci would generate a 600 to 700 pip rally back towards 1.4000.

Although this analysis is classic, my gut feeling is opting for one more low toward 1.3400 to 1.3350 into the jobs numbers in the U.S. this Friday.

Monday, March 1st, 2010

The EURUSD double bottom at 1.3451 is back within striking distance and perhaps our skepticism about the stops building under that level needing to be elected will be justified. It is our belief that once that capitilation becomes reality a counter trend trade will set up, stay tuned......

Friday, February 26th, 2010 - Dale J Pinkert, Head Trader at CurrencyTradingLive.com

Our Forecast that the EURUSD would retest last Friday's low at 1.3451 came to fruition in yesterday's trade to the pip at the same 1.3451.

What has me skeptical about this retest is that the low held to the pip. We would have been more constructive if that low would have been violated to take out the stops.

In my experience obvious stop loss orders usually get elected before a turn to have as few as possible participants on board for the move.

You know, something we have all experienced "Right the market, wrong the trade" Very newsy day in the U.S. today, GBP USD still demonstrating relative weakness the EUR USD as institutions continue the unwinding of EUR GBP

Feb 25th 2010 - Dale J Pinkert, Head Trader at CurrencyTradingLive.com

As forecast the EURUSD has declined to last Friday's low of 1.3451 and the GBPUSD washed out as well to targets discussed in our live trading room yesterday.

Although there may be additional weakness in the next 24 to 48 hours into the U.S. GDP report tomorrow it is our contention that it is no longer prudent to press the short side of these pairs.

We are now focusing for counter trend buying opportunities, best guess for EURUSD low is 1.3410 to 1.3350.

One other feature is USDCAD, that despite the USD strength upward momentum is strained and this whole move has only generated a fib retrace of 61.8 rather than new highs of 1.0790. Therefore a shorting opportunity is setting up, potential upside 1.0620. good trading, Dale J. Pinker

Feb 24th 2010 - Dale J Pinkert, Head Trader at CurrencyTradingLive.com

Fx and Equity Markets are attempting rebounds after yesterday's selloff on the dismal Consumer Confidence numbers.

The hopes are pinned on Fed Chairman Bernanke's testimony today although weakness in commodities (GOLD & OIL) continue this morning affecting the commodity curencies (CAD, AUD).

It is still our forecast that the EURUSD will make a run at last Friday's low of 1.3450 to set up the third momentum divergence which has us on alert for a counter trend tradable bottom.

Feb 23rd 2010 - Dale J Pinkert, Head Trader at CurrencyTradingLive.com

It was a "red day" across all asset classes, Crude Oil & Gold down, Equities down FX down all tied to the lynchpin of dollar strength.

Picture a balloon being blown up and then the air is released, the dollar is the air hose. When the dollar is weak air flows into the balloon and prices expand (go up), when the dollar is strong the air in the balloon is released and prices fall (go down, deflate).

We believe in the coming days, the EURUSD will trade below last Friday's low of 1.3450 and set up a counter trend buying opportunity and the air will flow back into the balloon. stay tuned......

Feb 22nd 2010 - Dale J Pinkert, Head Trader at CurrencyTradingLive.com

Quiet session today with markets vascillating in 50 pip ranges. Still looking for long EURUSD setups around 1.3550-25 and short USDJPY around 91.60. stay tuned. Remember "if it's not clear, steer clear" Best regards, Dale

February 19th 2010 - Dale J Pinkert, Head Trader at CurrencyTradingLive.com

Todays Fx action is a classic buy the rumor sell the fact, as the dollar spiked higher on the U.S. Fed's discount rate increase. As earlier commentary was forcasting a "long in the tooth" Euro decline and a tradable bottom to come, today's reversal reinforces that view.

Join us in our Currency trading room as we look for set-up entries on the long side of EURUSD and shorts in the USDJPY in the coming week. We will also review the relative strength of the Commodity Currencies CAD & AUD. have a good weekend & Best regards.

February 18th 2010 - Dale J Pinkert, Head Trader at CurrencyTradingLive.com

The USD after post holiday weakness regained it's footing and is pressing the recent highs of this rally. President Obama met with the Dalai Lama today against the Chinese government's wishes.

You may ask what does the USD and the Dalai Lama have to do with each other.

Well as we poke our Banker in the eye again following the arms sale to Taiwan, the U.S. may finally get what it's been pleading for, a higher Yuan.

This event will drive up already high consumer prices in this fragile recovery. Pundits will point out that it will help the balance of trade and make our exports more competitive. My question is, export what?

It is my contention that this could be the news that serves as a catalyst for a fairly sharp pullback in the USD against most of the Major Pairs which can unfold in the coming days. stay tuned...... Dale