Potential Reversal for GBP/CHF 2012

The GBP/CHF pair provides strong signals for a possible change of trends. The pair is reaching towards a support level at the moment. If the level is breached, the downward move is likely to extend.

• The chart below is the GBP/CHF 4-hour chart by ForexYard.
• The technical indicators used are the Bollinger Bands, the Slow Stochastic, the MACD/OsMA and the Relative Strength Index (RSI).
• The chart provides a very distinct bullish channel. However, the chart is touching its lowest border.
• A bearish cross on the Slow Stochastic has successfully predicted the modest bearish correction that we’re currently experiencing, which led the pair to the 1.6974 level.
• Currently, both the MACD and the RSI are on the verge of indicating a bearish reversal. If the MACD will indeed perform a bearish cross, and the RSI will drop below the 70 line (both marked in red), it will be a string sign for a significant drop.
• There are 3 consecutive support levels that can be observed at the moment. The support levels are placed at the 1.6950, 1.6800 and the 1.6650 prices. If a certain level will be breached, the pair is likely to reach towards the next support level.

source: forexyard.com

Dollar Stabilizes before GDP data 2012

The U.S dollar rose Tuesday as a decline in stocks and dimming expectations about the U.S. economic recovery increased demand for U.S currency perceived as safer. Some investors buy the Dollar, seen as a safe haven, against other higher-yielding currencies and sell assets like stocks and commodities when economic optimism diminishes.

The greenback also climbed on speculation traders exited bets against the dollar before the U.S. Thanksgiving holiday. Analysts said that risk aversion is back in the markets supporting the greenback and putting pressure on high-yielding currencies like the EUR. In the current environment a weak U.S. Gross Domestic Product (GDP) number weighs on sentiment. Traders are a little more sensitive to sentiment changes because they want to get out of positions ahead of the long U.S. weekend.

The Commerce Department will release its second estimate of 3rd quarter GDP at 13:30 GMT today. The data may show the world’s largest economy expanded at a 2.8% annual rate, compared with the 3.5% estimated last month, according to economists. Traders will keep on eye on the advance estimates on corporate profits to be released together with the GDP report. The U.S. economic data have become more mixed and a further poor U.S. economic data and a general desire to reduce risk ahead of year-end are likely to interact to support the U.S dollar.

The Federal Reserve will also release minutes of its Nov. 3-4 meeting at 19:00 GMT, which will include economic projections for the next two years. Market players will particularly focus on the Fed’s forecasts for unemployment in the U.S.

source: forexyard.com

Concerns over Strong Exchange Rate may Support USD vs. NOK 2012

It looks as if the USD may be getting some support against the Norwegian Krone as the Norwegian government plans to begin withdrawing its stimulus. According to the Finance Minister, Sigbjoern Johnsen, “Norway must remove government stimulus or risk faster interest rate increases that would strengthen the Krone and stifle an export recovery”. As a country that is mainly an exporting country, a very strong exchange rate erodes the exporters’ profits and hinders recovery and economic growth.

Norway’s economy is growing quite well and the government continues to stimulate the economy which supports the Krone further; the reason for it being that investors expect the central bank to continue raising interest rates. This expectation has helped the Krone to be the best performer of the 16 most tracked currencies since the end of June. The Krone gained 7.8% against the EUR and 15% against the USD in that period.

The trend receives support from technical analysis as well as can be seen below

• The chart below is the 2-hour USD/NOK chart by ForexYard.

• The technical indicators used are the Slow Stochastic, Relative Strength Index (RSI), and Williams Percent Range.

• There is a fresh bullish cross on the Slow Stochastic which suggests that a bullish movement is building.

• The Relative Strength Index (RSI) signals that the price of this pair currently floats in the over-sold territory, indicating upward pressure.

• The Williams Percent Range is testing the lower border at the -100 mark, which merely highlights some added upward pressure.

USD/NOK 2-Hour Chart

source: forexyard.com

The USD Rebounds from a 15-Month Low 2012

The U.S dollar advanced against 10 of its 16 most-traded counterparts after Federal Reserve Chairman Bernanke said yesterday central bank policy will ensure that the dollar remains strong.

The greenback managed a brief rally off Monday’s lows after Federal Reserve Chairman Ben Bernanke said the U.S. central bank is attentive to changes in the currency. The USD immediately jumped off the day’s lows with investors finding it unusual for a Fed chairman to talk on the Dollar. A temporary spike in the U.S. currency after the Fed chief’s comments helped it offset some of its session losses to the EUR but was quickly reversed. The USD turned negative as the Fed’s Chairman failed to convince investors that the U.S. would take action to shore up the greenback.

In Tuesday trading the U.S dollar was slightly up versus majors after the previous session’s sharp drop, supported by waning risk appetite as most Asian stock markets slumped. The U.S currency remained under pressure as U.S. equities advanced before Industrial production report which probably rose for a 4th consecutive month in October, signaling manufacturing is leading the rebound in U.S economy. The positive data suggests improvement in the U.S. economy and may embolden investors to move toward riskier assets and away from the relative safe-haven status of the greenback.

source: forexyard.com

Swedish Krona Continues to Gain on the Dollar 2012

The Swedish krona continues to be one the strongest performing currencies against the dollar. Since the beginning of the month, the krona has climbed over 2.5% on the greenback. Last week the outlook for the economic recovery in Sweden was updated as signs the global economic crisis is weakening. This was a catalyst for the krona as the currency further strengthened, particularly against the dollar.

The economic output of Sweden is predicted to fall by 4.9% this year while growing by 2% in the following year. This is according to the Sweden Ministry of Finance. The previous forecasts were slated to be a contraction of 5.2% for the current year and growth of 0.6% in the following year. Unemployment forecasts were also reduced for next year to 10.7% from 11.4%.

The revised forecasts were followed by strong comments from the Swedish Finance Minister, Anders Borg. Borg would like to see further economic policy enacted to assist in the expansion of the Swedish economy. Along with a government stimulus package and spending on new infrastructure projects, the government is in the position to further cut taxes.

These economic measures bode well for the Swedish economy and in particular the krona. It may explain why traders have bid up the price of the krona in recent trading. As the dollar continues to fall against the major currencies and the Swedish government continues to submit favorable legislation on the part of the economy, being short on the USD/SEK is preferred.

source: forexyard.com

Dollar Gains on U.S. Unemployment Data 2012

The dollar rose against most of it major currency pairs on Thursday after U.S. weekly jobless claims came in lower than expected.The weekly report has had greater impact on trading in recent months because of investor concern that the U.S. economic recovery will be tepid and creates few new jobs to replace those lost during the recession.

The USD/JPY cross is actually currently trading higher by 80 pips today at 90.47. However, against the EUR, the Dollar is trading higher by 150 pips at 1.4855, as we see a sharp correction in the pair’s behavior. The GBP/USD pair is level today at 1.6550, as market volatility seems to have slowed down as late night trading approaches.

As for tomorrow, many impacting economic indicators are expected from the U.S. economy. Traders are advised to pay special attention to two leading indicators, the U.S Trade Balance and Prelim UoM Consumer Sentiment. A positive result from both this indicators might boost the Dollar towards another day of rising trends.

source: forexyard.com

Scandinavian Economies Leading Europe out of Recession?

Following last week’s employment data from the United States it appears as if the US Dollar has entered a free-fall and many other global currencies are reaping the benefits. The Scandinavian currencies have largely entered bullish trends against the greenback, but also surprisingly against the EUR.

While some analysts were concerned about a swift Swedish recovery due to the Baltic crisis, most countries in the northerly region have seen strong and steady growth. Norway’s economy has benefited largely from climbing Crude Oil prices and Denmark’s debate about entry into the EU’s legal regulations has helped its economy find direction.

The NOK, SEK and DKK have all climbed to 2-week highs versus the USD, as well as a near-2-week high against the EUR. Following Norway’s decision to hike interest rates recently, the region appears to be on the receiving end of recent risk appetite. If this continues, Scandinavia may find itself leading the broader region out of this economic downturn.

Technical Analysis

- The chart below is the 2-hour EUR/SEK chart by ForexYard.

- The indicators used are the Relative Strength Index (RSI) and the Stochastic (slow).

- Point 1: The RSI shows that this pair is currently over-sold and experiencing upward pressure.

- Point 2: The Stochastic (slow) shows a deep bullish cross followed by an upward cascading price movement. This suggests that there is momentum behind the current upward correction.

source: forexyard.com

EUR/USD Hits $1.50 level 2012

European’s currency rose against a broadly weaker U.S. dollar yesterday after the Group of 20 promised to keep stimulus policies in place until the global economic recovery was assured. The EUR is trading about 1% higher against the U.S. dollar amid general risk appetite for high-yielding assets on Tuesday.

The European currency’s strength was in line with other global currencies that took advantage of renewed risk appetite that suggested U.S. interest rates will stay low for some time; particularly after last week’s soft U.S. jobs data

source: forexyard.com

EUR’s Trends to be Set by German ZEW Economic Sentiment 2012

The EUR’s trends for the upcoming day are likely to be set by the outcome of the German ZEW Economic Sentiment publication at 10:00 GMT. The forecast is 58.9, versus the 56.9 previous result. A result matching the forecast, or even better is likely to boost the EUR. Therefore, we could see the EUR/USD cross surpass the 1.5050 level. However, a result worse than this could lead to a very bearish EUR indeed. Traders, it is highly recommended that you open your positions in the EUR’s main crosses as soon as possible.

source: forexyard.com

USD/JPY on Course for Bearish Correction 2012

USD/JPY sustained upward movement has finally pushed its price into the over-bought territory on the hourly chart’s RSI. Not only that, but there actually appears to be a bearish cross on the Slow Stochastic pointing to an imminent downward correction. Forex traders have the opportunity to wait for the downward breach on the hourlies and go short in order to ride out the impending wave.

USD/JPY Hourly Chart

source: forexyard.com

U.S. Unemployment Claims to Set the Pace of the USD 2012

The U.S. Unemployment Claims Report will set the pace of the USD today. Despite the Dollar diving against the GBP so far today, in the coming hours there is some mouthwatering data that is set to be released from the U.S. Britain kept her rates unchanged earlier today, as the Bank of England (BoE) revealed that its quantitative easing will conclude sooner rather than later. This is why the GBP/USD cross is set for a 3 day winning streak. The pair is already up by over 100 pips today at the 1.6618 mark.

However, in the coming few hours, the leading currencies, such as the GBP/USD cross will be under much pressure from the Dollar, as a string of data is set to be released from the U.S. At 13:30 GMT, the Unemployment Claims, Prelim Nonfarm Productivity and the Prelim Unit Labor Costs will all be published simultaneously from the U.S. Surrounding these releases; there will be very high volatility in the forex market. Thus to open big positions in the U.S. Dollar now will be the wisest decision that you make this week.

source: forexyard.com

The U.S Dollar Slips after Fed Decision 2012

The USD lost some ground against major counterparts Wednesday after the Federal Reserve left Interest Rates unchanged and made only slight changes to its monetary statement. The greenback slid 0.9% to $1.4860 per EUR from $1.4724 yesterday.

It touched $1.4902, the weakest level since Oct. 27. The U.S dollar suffered a broad-based decline, trading lower against every major foreign denomination except the Japanese yen. The Dollar advanced 0.8% to 91.03 yen, from 90.33.

As expected, the Fed kept its target for its federal funds rate set at a range of zero to 0.25%. The central bank said it would buy $175 billion of agency debt, down from prior plans to purchase $200 billion, as there was a limited availability of the securities.

The Dollar was not forecast to gain any serious ground to the EUR for many more months or at least until the U.S. Federal Reserve decides the time is right to raise rates. A decision and statement later Wednesday from the Fed should confirm that will not come for some time.

source: forexyard.com

USD/NOK Expected to Rebound Today 2012

In yesterday’s trading, the USD/NOK cross experienced much bearishness, as it now stands at 5.6840. However, it seems that this trend may be coming to an end. I will illustrate below that the USD/NOK may very well be heading for a reversal. Forex traders have the opportunity to wait for the upward breach on the hourlies and go long in order to ride out the impending wave.

• The technical indicators that are used are the Williams Percent Range and Slow Stochastic.

• Point 1: There is a “doji” candlestick that has formed on the chart, indicating that a reversal should take place.

• Point 2: The Slow Stochastic indicates a bullish cross, signaling that the next move may be in an upward direction.

• Point 3: The Williams Percent Range indicates that the price of this cross currently floats in the oversold territory, signaling upward pressure.

USD/NOK 4-Hour Chart

source: forexyard.com

USD/ZAR Looks to Drop towards the 7.60 Level 2012

After stretching the Fibonacci Retracement lines, it becomes very clear that the pair is testing a very significant support level at the moment. If the pair will breach this level, the next support level looks to be located at 7.60.

• The chart below is the USD/ZAR chart by ForexYard.

• The technical indicators used are the Bollinger Bands, the Relative Strength Index (RSI), the Slow Stochastic and the MACD/OsMA. The Fibonacci Retracement lines are used as well.

• The Slow Stochastic shows a sequence of bearish crosses, and has recently located below the 20 line. This indicates that the pair’s downtrend could extend.

• The MACD provides a clear bearish signal as a bearish cross has recently taken place. The MACD is pointing directly down, strengthening the bearish indication.

• The pair is currently traded around the 50% line located at the 7.74 level. It seems that if the pair will breach the 7.725 level, a sharp drop could take place with potential to reach the 7.60 level – the 38.2% line, the next significant support level.

• The RSI is currently located near the 30 line. If the RSI will drop below this line, this will state that the pair has reached the Over-Sold zone, and could put extra bearish pressure on the pair.

source: forexyard.com

Impending Bearishness for GBP/USD 2012

The GBP/USD cross has experienced a bullish trend for the past day. However, it seems that this trend may be coming to an end, as described below. Forex traders can take advantage of this imminent downward movement by entering short positions at an excellent entry price.

• The technical indictors used are the Slow Stochastic, Relative Strength Index (RSI) and Williams Percent Range.

• Point 1: Relative Strength Index (RSI) signals that the price of this pair currently floats in the over-bought territory, indicating downward pressure.

• Point 2: The Slow Stochastic indicates a bearish cross, signaling that the next move may be in a downward direction.

• Point 3: The Williams Percent Range also supports the downward direction.

GBP/USD Hourly Chart

source: forexyard.com

EUR/USD Channel Line 2012

A long term perspective may be taken with an existing channel line and an opportunity for entering the market may exist for the EUR/USD pair.

The original trend line (1) has been drawn, connecting with yesterday’s closing price of 1.4732. A parallel channel line (2) has been drawn from the prominent peak of 1.3630. Notice the pair has dropped down to the original trend line at yesterday’s close and is now proceeding upward. This may present an opportunity for entering into the market with a new long position.

source: forexyard.com

Arbitrage 2012

Profiting from differences in the price of a single currency pair that is traded on more than one market.