| Forex Hacking – New Ebook for All Traders Posted: 14 Feb 2010 12:30 AM PST 
Jakob Dupont Knudsen of TradeProfits has written a comprehensive book about forex trading. The new book is for beginners as well as seasoned traders. Here’s a review and a hand out. Forex Hacking begins from giving good habits to new traders: Knudsen lays out a proper trade log. He then goes to deal with risk management, an important aspect that is neglected by many traders. The book continues to separating breakouts from “fakeouts”, trading the news, advanced technical analysis and lots more. I found the chapter about Gap Trading very interesting. Forex Hacking will be launched on Tuesday, February 16th. The author has agreed to hand out 4 free copies to Forex Crunch readers! All you have to do is comment on this post with a valid email until Monday, February 15th 23:59 GMT. I’ll randomly pick 4 winners on Tuesday and announce them. In the comment, you may ask Jakob any question you like, or write anything you wish…
About the author, in his own words: My name is Jakob Knudsen. I am a guy in the late twenties from Denmark. I have been interested in day trading for almost as long as I can remember . I have been involved with forex trading for about six years now. This has been on and off, as I have been studying and working at the same time. Practice and real accounts. I sure have lost my share in this game, but I see this as an "educational fee". I was, like the majority of other traders, dragged into this game from fake claims, promising me millions overnight. I had a good time in the beginning, especially when demo trading, but I soon realized that this was not as easy as I had been promised. I then started buying EA´s, signal services, systems, etc. I have been all over the place, and realized that most of these services and products is nothing but hot air. A few good ones and a lot of bad ones! Getting started in forex trading takes time, and luckily I kept trying. Now I am not claiming to be a guru, but I sure have learned a lot throughout the years, and this is what I am sharing in this book. I am not telling anyone they will be rich overnight through forex trading, and my book will not make them millionaires either. I am just so sick and tired of seeing these typical scroll-down-for-two-hours-and-read-how-to-get-rich-overnight-pain-in-the-ass-fake sales pages.
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| EUR/USD Outlook – February 15-19 Posted: 13 Feb 2010 07:04 AM PST 
The Euro had a very volatile week and eventually finished lower. The upcoming week will see an important German survey among other figures. Here’s an outlook for the upcoming week in the Euro-zone and an updated technical analysis for EUR/USD. EUR/USD graph with resistance and support lines marked. Click to enlarge: 
The Greek troubles will continue to dominate the Euro’s situation. This is going on for quite some time. Let’s see what else will impact the Euro: - ZEW Economic Sentiment: Published on Tuesday at 10:00 GMT. This indicator is an important gauge of economic activity. In the past months, it has deteriorated sharply, going hand by hand with the Eurozone’s troubles, and Germany’s stagnant economy. The German indicator is predicted to dive again – this time from 47.2 to 41.9 points. The all-European figure is expected to slide from 46.4 to 42.6 points.
- German PPI: Published on Friday at 7:00 GMT. Producer prices slipped by 0.1% last month, falling short of predictions again and again. A rise is expected this time – of 0.4%. A rise in prices can lead to a rate hike, but this doesn’t seem close at the moment.
- French Flash PMI: Published on Friday at 8:00 GMT. Purchasing managers numbers will pour on Friday. The continent’s second largest economy will start. French Flash Manufacturing PMI is predicted to remain stable at 55.3 points and also the services sector isn’t expected to move from 56.3 points.
- German Flash PMI: Published on Friday at 8:30GMT. Germany has lower PMI numbers than France, but they’re predicted to rise. German Flash Services PMI is predicted to edge up to 52.5 points and the manufacturing sector is expected to show a rise from 53.7 to 54.1 points.
- European Flash PMI: Published on Friday at 9:00 GMT. The figures for the whole continent will complete the picture – Flash Manufacturing PMI is predicted to rise from 52.4 to 52.8 points and Flash Services PMI from 52.5 to 52.6. These figures will have a strong impact if they all go in one direction. The releases cause choppy trading.
- Current Account: Published on Friday at 9:00 GMT. The European balance is expected to turn from a surplus of 0.1 billion to a deficit of 0.6 billion. Yet another negative figure for the continent…
EUR/USD Technical Analysis In the middle of the week, when the Greek crisis seemed to see a resolution, EUR/USD broke through 1.3750 and stopped at 1.3850. The 1.3850 line is new on the chart – it wasn’t there last week. Further above, the previous range lines of 1.40 (also a round number) and 1.420 are still there. Higher, there are lots of important lines, but the Euro is too far from them. Looking down, 1.3580 remains as a support line. It was breached only temporarily on Friday, so it’s still important. Lower, 1.3420 is an important support line, serving as both a clear support and resistance line in the past. Far below, 1.3080 is the area where the Euro began the last long term move upwards. The pair is currently too far away from this line. My bearish sentiment on the Euro remains. Adding the fear of a new recession to the Greek debt problems, and you have a recipe for further losses. This pair receives a lot of great commentary on the web. Here are my favorites: - Casey Stubbs talks about the Euro bouncing off lows. I’m waiting for a fresh analysis from him.
- James Chen discusses the steep downtrend continuation potential.
- The Geek Knows reviews the last week and looks forward.
- Dan Cook on TheLFB, discusses the extreme market noise.
Further reading: Want to see what other traders are doing in real accounts? Check out Currensee. It’s free. |
| GBP/USD Outlook – February 15-19 Posted: 13 Feb 2010 07:03 AM PST 
The upcoming week is very busy for cable traders. Inflation, employment and retail sales are among the many events. Here’s an outlook for this week’s data and an updated technical analysis for GBP/USD. GBP/USD graph with resistance and support lines marked. Click to enlarge: 
One of the things that hurt the Pound this week was the NIESR GDP estimate aligned with the official GDP release for Q4 and pointed to very weak growth. The Pound survived it. Let’s see the events that await us: - Rightmove HPI: Published on Monday at midnight GMT. The first event of the week is an early indicator of house prices. According to Rightmove, house prices have risen by 0.4% last month after two months of drops. A similar rise is predicted this time.
- CPI: Published on Tuesday at 9:30 GMT. British inflation is on the rise. BOE governor Mervyn King refuses to admit this and insists that the rise is temporary – meaning no rate hike is in the horizon. Last month’s 2.9% rise was still OK – in the government’s target. This time, an annualized rise of 3.6% is predicted. What will King say about this? Also Core CPI is predicted to rise – from 2.8% to 3.2% and RPI (Retail Price Index) is predicted to rise by 3.8%. Note that the RPI has been negative for many months.
- BOE Inflation Letter: Publication tentative. If CPI expectations are met, and inflation rises beyond 3%, Mervyn King is obliged to issue a public letter to the government, explaining the reasons for this and the measures that will be taken to address it. It will be interesting to hear his official response to such numbers.
- Employment data: Published on Wednesday at 9:30 GMT. The number of unemployed Brits is expected to fall for a third month in a row. The Claimant Count Change is predicted to drop by 14.6K, following a 15.2K drop last month. This early indicator (for January) moves the Pound. British unemployment rate is predicted to remain stable at 7.8% in December 2009. Economists were wrong on this in previous months. This highly cited figure exceeded expectations.
- MPC Meeting Minutes: Published on Wednesday at 9:30 GMT, together with the employment data. The last rate decision ended without a rate hike and without renewing the funds for the QE program. King already said that this program might be expanded again, thus hurting the Pound. We’ll get to see what the different members thought about it. In the past, their votes split 3 ways at times. Together with the employment figures, this is a very shaky time for GBP/USD.
- Public Sector Net Borrowing: Published on Thursday at 9:30 GMT. British public expenditure is eyed by the opposition and by investors alike. After many months of extended borrowing, the British government is expected to report negative borrowing – something that will help the Pound.
- CBI Industrial Order Expectations: Published on Thursday at 11:30 GMT. This indicator has been negative for a long time, meaning that a lower volume of orders is expected. Also this time, the 550 manufacturers that are surveyed are predicted to show lower expectations. The result of the survey is expected to be -35, slightly better than -39 last month.
- Paul Fisher talks: Will begin speaking on Thursday at 19:00 GMT. BOE Executive Director Paul Fisher is an influential voting member and he might move the Pound if he makes interesting statements in his speech in London. He might relate to the weak GDP.
- Retail Sales: Published on Friday at 11:30 GMT. The eventful week finishes with a strong number as well. This important consumer gauge is predicted to drop by 0.5% after rising by a disappointing 0.3% last month. This will fuel Friday’s volatility.
GBP/USD Technical Analysis The Pound got used to a new range this week: 1.5530 to 1.5770. At the end, GBP/USD closed very close to last week’s close. I’ve pushed up the 1.5720 line that appeared in last week’s forecast to 1.5770, according to the current trading range. Above, 1.5833 was December’s low and supplies a minor line of resistance. Higher, 1.6110 is another resistance line, backed by 1.6260, a line that served as both a support and resistance line recently. Looking down, 1.5530 is the initial line of support, serving as such this week. Below, 1.5350 is a strong line of support, serving in the past as a resistance line before the Pound went up. Even lower, the magical round number of 1.50 awaits, but it’s far below. I'm bearish on the Pound Weak economic growth is a burden on the British economy, despite rising employment and inflation. In addition, GBP/USD didn’t recover from losing an important support line. Further reading: Want to see what other traders are doing in real accounts? Check out Currensee. It’s free. |
| AUD/USD Outlook – February 15-19 Posted: 13 Feb 2010 07:02 AM PST 
The Aussie finally enjoyed a good week and made some gains. The upcoming week contains lots of important speeches that will shape the direction of the Aussie. Here’s an outlook for this week’s 7 Australian events and and updated technical analysis for AUD/USD. AUD/USD graph with resistance and support lines marked. Click to enlarge: 
Australian employment figures exceeded expectations for fourth month in a row. This was the main driver of the Aussie. Will these gains convince policymakers to renew the rate hikes? We’ll get a lot of information about it this week. Let’s start the review. The technical analysis will follow: - Monetary Policy Meeting Minutes: Published on Tuesday at 00:30 GMT. The last Australian rate decision was quite disappointing – no rate hike. This happened after 3 consecutive hikes and came as a surprise. We’ll get to know why. The release will shake the Aussie.
- NAB Business Confidence: Published on Tuesday at 00:30 GMT and overshadowed by the meeting minutes. The last release was just two weeks ago, and it showed a drop in business confidence – according to NAB survey of 350 businesses. It fell from 19 to 8 points – still in the positive zone. A similar figure is expected this time.
- Guy Debelle talks: Speaks on Tuesday at 1:45 GMT. The RBA Assistant Governor is an influential member of the RBA and also has an important role in the decision to leave the interest rate unchanged despite rising inflation. His speech might refer to future policy will likely rock the Aussie.
- MI Leading Index: Published on Tuesday at 23:30 GMT. The Melbourne Institute publishes a compound index out of 9 economic indicators. Although many of them have already been released, this sometimes surprises and is also revised afterwards, usually to the upside. The rise of 1% is expected to be followed by a rise of lesser scale.
- Philip Lowe talks: Talks on Wednesday at 22:20 GMT. Continuing the parade of speakers, Lowe will join with his own views. Prospects on future rate hikes after the recent pause will move the currency.
- NAB Quarterly Business Confidence: Published on Thursday at 00:30 GMT. This is complementary release to Tuesday’s monthly release. After reaching a positive score of 16 points in the previous quarter, this indicator probably won’t stay so high this time, but it will likely be positive, indicating continuing improving economic conditions.
- Glenn Stevens speaks: Talks on Thursday at 22:30 GMT. This speech is of high importance as it’s an official testimony in parliament. Stevens will lay out the economic situation in front of an official committee that might give him a hard time.
AUD/USD Technical Analysis AUD/USD began the week on a positive note, climbing up to 0.8780. The move strengthened toward the end of the week, as the pair peaked at 0.8910, and closed at 0.8876. I’ve marked 0.8780 as a new support line. It wasn’t there last week. This provides initial and minor support. Below, 0.8567 was a support line before the Aussie pushed higher and last week as well. Even lower, 0.8477 was a strong resistance line during the summer, before the Aussie made an upwards push. Looking up, 0.8950 is still a might resistance line. A convincing break of 0.8950 is necessary for the bulls to rage an for my sentiment to turn bullish. Even higher, 0.9090 is the next line of resistance, working as such several times in recent month. Above, 0.9170 is another line of resistance after working as a temporary support line. Way above, 0.9322 is a very strong resistance line, being breached only once in 2009, and otherwise causing the pair to bounce. I continue to be neutral on AUD/USD. On one hand, the great employment figures reminded us about the Australian economy’s strength. On the other hand, the Chinese tightening measures and also the ongoing Greek crisis continue to trigger risk aversion, which moves money away from the Aussie. Further reading: Want to see what other traders are doing in real accounts? Check out Currensee. It’s free. |
| USD/CAD Outlook – February 15-19 Posted: 13 Feb 2010 07:01 AM PST 
In the past week, the loonie gained nice ground against the greenback. The upcoming week provides many important indicators. Here’s an outlook for the Canadian events and an updated technical analysis for USD/CAD. USD.CAD graph with resistance and support lines marked. Click to enlarge: 
The most important release is CPI. Can prices pick up and accelerate the pace of rate hikes? Let’s start the review. The technical analysis will follow. - Manufacturing Sales: Published on Tuesday at 13:30 GMT. After a few strong months, this indicator rose by only 0.1% last month. Manufacturers are predicted to report a slightly higher volume of sales this time – 0.4%. This goes together with Canada’s slow and steady growth.
- Wholesale Sales: Published on Wednesday at 13:30 GMT. Although being far from the consumers, also wholesalers have a significant impact on the economy. They reported a nice jump in sales last month – 2.5%. A slower rise is expected this time – 1.7%.
- David Longworth speaks: Talks on Wednesday at 17:30 GMT. David Longworth is about to end his term as BOC Deputy Governor quite soon, so he may feel free to speak his mind about the economy and the bank’s policy – currently sticking to a projected rate hike in June 2010.
- CPI: Published on Thursday at 12:00 GMT. Canadian prices jumped two months ago, sparking expectations of a rate hike, but they fell last month by 0.3% erasing those hopes. This time, CPI is expected to get “back to normal” with a rise of 0.3% while Core CPI, no less important, is expected to rise by 0.3%.
- Foreign Securities Purchases: Published on Thursday at 13:30 GMT. Foreigners have shown their confidence in the Canadian economy as they doubled their investments last month to 10.5 billion. A drop to 7.5 billion is predicted this time. Note that the Russian central bank is fond of the Canadian dollar.
- BOC Review: Published on Thursday at 15:30 GMT. The central bank publishes a thorough review of the economy, showing what figures they examine when making policy decisions. Special finding could sure move the loonie.
- Retail Sales: Published on Friday at 13:30 GMT. This consumer-centric indicator disappointed with a drop last month. Also core retail sales didn’t help too much as they stayed unchanged. Rises of 0.5% are expected in both indicators, showing that Canadian consumers are back to normal.
- Leading Index: Published on Friday at 13:30 GMT and overshadowed by retail sales. Although most of this indicator’s components have already been published, it still has an impact. Last month saw a neat rise of 1.5%, but this time it’s predicted to rise only by half that number 0.8%.
USD/CAD Technical Analysis At the beginning of the week, USD/CAD traded high, in the extended range that followed the release of the American NFP. It later fell below the minor 1.0530 support line and managed to close below it. 1.0532 turns into a resistance line, an opposite role than in last week’s outlook. The next resistance line is major – 1.0780, an extension of the long lasting range. 1.0850 is the next line of resistance, serving as a peak before USD/CAD entered the current range. Even higher, 1.1130 was a stubborn resistance line a few times during 2009. Below, 1.04 continues to provide strong support, being the bottom line of a wider range that accompanies us for quite some time. Even lower, 1.02 was the lowest level in 2009, and the pair also got close to it in 2010. Parity is far below – it won’t be reached soon. I remain bearish on USD/CAD. Canada’s strong economy, as seen once again in the employment figures, is moving the currency higher, and there’s more room for gains. Further reading: Want to see what other traders are doing in real accounts? Check out Currensee. It’s free. |
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