Forex Crunch European trouble sends EUR/USD down |
- European trouble sends EUR/USD down
- You Wouldn’t Go To War Without A Plan… So Why Trade That Way?
- Forex Daily Outlook – July 30 2010
- Do YOU have have what it takes to make it to the Trade Leaderboard?
| European trouble sends EUR/USD down Posted: 30 Jul 2010 03:54 AM PDT
EUR/USD is under 1.30 once again, after bouncing at the resistance line, suffering from weak economic data, and with Spain causing worries once again. It now approaches the lower border of the steep uptrend channel. Here’s an update. I’ve discussed the EUR/USD uptrend channel in the article on Tuesday about Euro/Dollar at resistance. I wrote there that an upwards move could be seen on Thursday, when the only figure released comes from Germany – the locomotive of the Euro-zone. This indeed happened:
German unemployment change surprised with a drop of 20,000 people, slightly better than expected. EUR/USD went higher and peaked at 1.3107, extremely close to the 1.3114 line. This important line held the Euro before it collapsed in May, and also capped the pair when it attempted resistance. Moody’s: Spain could lose AAA rating After trading in the vicinity of 1.31 and failing to break, this morning’s bad figures sent the pair down. A disappointment came from Germany – retail sales fell by 0.9%, when an unchanged number was expected. The result was blamed on last month’s strong growth, but it doesn’t really matter – the strongest country in the Euro-zone isn’t perfect. Then came the figures for the whole Euro-zone: inflation, as reflected in the CPI Flash Estimate rose by an annual rate of 1.7%, short of 1.8% that was predicted – Trichet won’t be in a hurry to raise the rates next week. The second figure didn’t surprise anybody, but is still bad – the unemployment rate in the Euro-zone stands on 10% – still very high. The really bad news came from Moody’s – the famous credit rating agency warned that Spain may lose its AAA rating. Spain is the fourth largest economy in the Euro-zone. In mid June, there was fear that Spain would suffer a credit freeze that would hurt the whole Euro-zone. After 6 weeks of successful bond auctions, a world cup victory and quiet on the economic front, Spain hurts the Euro once again. The result – Euro falls. EUR/USD Falls and Approaches Uptrend Support EUR/USD fell below the psychological level of 1.30 and currently trades at 1.2983 – over 100 pips drop. The next support line is at 1.2880, which was a support line about a year ago. Further support lines can be seen in the Euro dollar forecast. But let’s look at the uptrend channel. EUR/USD is now approaching the bottom line of this channel – the uptrend support. The current level of this uptrend is 1.2966, quite close to the current price. The pair is supported by this line, and the fall stopped at the moment. Nevertheless, this uptrend support is getting closer, and the pair will need to rise quickly in order to escape it and remain in the uptrend channel. The Euro’s recent ride came on the back of US weakness. We’ll probably see more weakness in the upcoming release of the US Advance GDP for Q2. Still, we got reminder about the situation in Europe – and it isn’t far better. Want to see what other traders are doing in real accounts? Check out Currensee. It's free.. |
| You Wouldn’t Go To War Without A Plan… So Why Trade That Way? Posted: 29 Jul 2010 10:32 PM PDT
Guest post from visionsofaffluence.com When most of us start out in the trading business we view it as the path to quick riches. We think that all we have to do is find a indicator, slap it on a chart and then voila we will be transformed into expert traders. This couldn’t be further than the truth, as it takes more than simply using the right indicator to have success. It takes hard work and dedication, but most of all it takes a plan. You see the forex market is chaotic. At any given time you have a large number of participants all trying to do the same thing which is make a profit. All of these people are competing with each other to be on the winning side of a trade. The only way you will be able to compete with these traders is if you have a sound trading plan. You need to develop a method of trading that is consistent. This is done by setting rules for yourself. Rules that will guide your trading.
Trading rules can be things like the criteria that must be satisfied in order for you to take a trade. Or where you will place your stop and where you will take profit. These rules have to be adhered to strictly because the success of your trading will depend on it. Without these rules you will become a victim to your emotions. You will open and close trades not for any rational reason but rather because you feel like that’s what you should do. This emotion based trading has been the kiss of death for many trading careers and unless you have a plan then the same will happen to you. A trader is only as good as their plan. If your plan is weak then your trading will suffer. Before you ever take a trader you need to take the time to develop a solid trading plan and then stick to it as if your life depends on it. That is the only way that you will ever be successful in this business. Want to see what other traders are doing in real accounts? Check out Currensee. It's free.. |
| Forex Daily Outlook – July 30 2010 Posted: 29 Jul 2010 02:00 PM PDT
U.S. Advance GDP, US Employment Cost and Canada’s GDP are the major event at the end of another trading week. Here is an outlook on today’s events. In the US, Advance Gross Domestic Product, the main measure of economic activity and growth in the world's largest economy will bring the preliminary estimate of the U.S. GDP, which is forecasted to be in line with the market's expectations of slower 2.5% economic growth in Q2 2010, compared with 2.7% in the first quarter while Advance GDP Price Index is expected the same growth rate of 1.1% as in the previous quarter.
More in the US, Employment Cost Index measuring the change in the price businesses and the government pay for civilian labor is forecasted 0.5% rise following 0.6% rise in the previous month. Finally in the US, Chicago PMI predicted to drop 3 points from June to 56.1 points while Revised UoM Consumer Sentiment based on a survey of about 500 consumers which asks respondents to rate the relative level of current and future economic conditions is foreseen a 1 point rise from 66.5 points and Revised UoM Inflation Expectations expected to remain around 2.9% as in the previous month. In Canada, Gross Domestic Product, the main measure of economic activity and growth expected to pick up slightly by 0.1% in June from the flat reading of 0% in May. In Europe, Consumer Prices, the main measure of inflation in the Euro-zone and the European Union's equivalent expecting inflationary pressures following a brief pullback, estimated to rise by 1.8% y/y in July from 1.4% y/y in the previous month. Finally in Europe, Unemployment Rate in the Euro-Zone is expected to remain 10%. For more on the Euro, read the EUR/USD forecast and Casey Stubbs' latest analysis. In Switzerland, KOF Economic Barometer index based on 12 economic indicators expected to rise by additional 0.07 points to 2.32 points may have significant impact on the market. In Australia, Private Sector Credit forecasted a 0.4% rise following 0.5% rise in the previous month indicating consumer’s continue borrowing and spending. For more on the Aussie, read the AUD/USD forecast. In Japan, Housing Starts predicted a positive 1.7% increase following 4.6% dip in the previous month. That’s it for today. Happy forex trading! Want to see what other traders are doing in real accounts? Check out Currensee. It's free. |
| Do YOU have have what it takes to make it to the Trade Leaderboard? Posted: 29 Jul 2010 08:38 AM PDT
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