Forex Market Commentary
Currency markets are trading narrow channels as all eyes await friday's NFP.
EUR/USD slides back from the 1.13 as specs sit on the sidelines waiting for data releases that could send the currency pair either way. with the lack of any news in general the Dow as usual has a good day climbing 82 points to close at 17924. But everyone round the planet know that the Dow and globally, equities are inflated as are the bonds markets that have been on a 6 year wave of price growth as US yields fell with Ben Bernanke's tapering program. It's only a question of 'when'? when will the equities and bond bulls realise that really theyre floating on a bubble and that it's only a matter of time before Yellen will have to do something more dramatic than issue vague statements on interest rates. On the EUR/ USD the shorts are 10% lower than last week. currently the front end futures show 68% net shorts and we're way into over sold territory. There has to be more blood-letting before the next spurt will occur to carry the USD forwards. Could this friday's NFP be the clincher for large scale spec action? Noise and momentum traders thrive for that moment and will be watching with a keen eye for any tell-tale signs of large spec activity.
One curious note is happening in the Euro zone in the bonds markets. the last week has been a torrid time for bond investors in Us debt but also with the German Bund at the center of Europe. The 10-year German government note is saw it's yield rise dramatically from 0.17% to 0.77% in a single week! A sell off has occurred as investors have sold their Bunds and as a result of big selling the implied yield has risen which has added to EUR currency strength. How long will this sell-off occur? Are we at the point where investors are becoming nervous over bonds and equities since there's not much price growth left in the bond markets and earnings globally are starting to look rather shaky for equities.
Choice articles on Bloomberg today are - for equities read -
http://www.bloomberg.com/news/articles/2015-05-07/u-s-stock-index-futures-fall-amid-concerns-before-payrolls-data
and
http://www.bloomberg.com/news/articles/2015-05-07/here-s-what-to-look-for-in-friday-s-jobs-report
Gold has held it's sway for the moment in the face of a bond sell off and crude oil holds high ground due to the simple economics that the glut is over and trade flow is beginning to pick up to add a solid basis to the new benchmark price in the 60's.
EUR/USD slides back from the 1.13 as specs sit on the sidelines waiting for data releases that could send the currency pair either way. with the lack of any news in general the Dow as usual has a good day climbing 82 points to close at 17924. But everyone round the planet know that the Dow and globally, equities are inflated as are the bonds markets that have been on a 6 year wave of price growth as US yields fell with Ben Bernanke's tapering program. It's only a question of 'when'? when will the equities and bond bulls realise that really theyre floating on a bubble and that it's only a matter of time before Yellen will have to do something more dramatic than issue vague statements on interest rates. On the EUR/ USD the shorts are 10% lower than last week. currently the front end futures show 68% net shorts and we're way into over sold territory. There has to be more blood-letting before the next spurt will occur to carry the USD forwards. Could this friday's NFP be the clincher for large scale spec action? Noise and momentum traders thrive for that moment and will be watching with a keen eye for any tell-tale signs of large spec activity.
One curious note is happening in the Euro zone in the bonds markets. the last week has been a torrid time for bond investors in Us debt but also with the German Bund at the center of Europe. The 10-year German government note is saw it's yield rise dramatically from 0.17% to 0.77% in a single week! A sell off has occurred as investors have sold their Bunds and as a result of big selling the implied yield has risen which has added to EUR currency strength. How long will this sell-off occur? Are we at the point where investors are becoming nervous over bonds and equities since there's not much price growth left in the bond markets and earnings globally are starting to look rather shaky for equities.
Choice articles on Bloomberg today are - for equities read -
http://www.bloomberg.com/news/articles/2015-05-07/u-s-stock-index-futures-fall-amid-concerns-before-payrolls-data
and
http://www.bloomberg.com/news/articles/2015-05-07/here-s-what-to-look-for-in-friday-s-jobs-report
Gold has held it's sway for the moment in the face of a bond sell off and crude oil holds high ground due to the simple economics that the glut is over and trade flow is beginning to pick up to add a solid basis to the new benchmark price in the 60's.
Please note that technical data should only be used as a guide but be aware that it is the fundamental data which becomes the trigger that pushes prices into equilibrium of demand and supply.
Always look to support and resistance band lines as the key to understanding in the long and short term where prices are converging. Professional technical traders use 50 day and 200 day medium and slow moving averages as fundamental cornerstones for interpreting the direction of price action.
USDX
US Dollar
94.627 +0.007 +0.01%
94.627 +0.007 +0.01%
Support 93.590 Resistance 95.520
Forward 1 year - 95.767. Flat line.
Forward 1 year - 95.767. Flat line.
EUR
1.12710 -0.00673 -0.59%
Support 1.11500 Resistance 1.14600
Forward 1 year - 1.13710. Flat line.
Crude Oil
59.00 +0.06 +0.10%
Support 56.76 Resistance 62.40
Forward 1 year - 62.99. Low growth positive line.
Forward 1 year - 62.99. Low growth positive line.
Gold
1183.420 -5.220 -0.44%
Support 1,169.9 Resistance 1,198.1
Forward 1 year - 1,188.1. Low growth line.
Pieter Bergli - DeLoren Trust Holdings
A non-profit commitment to provide education on the properties of currency markets
Forex market commentaries and media reports for free
Disclaimer - U.S. Government Required Disclaimer - Commodity Futures Trading Commission
Futures and Options trading involves risks of losses. No representation is being made that any reader and account will or is likely to achieve profits or losses similar to those that are being discussed on this blog http://forexeducationperspective.blogspot.com/. The past performance of any trading system or methodology discussed is not necessarily indicative of future results.
CFTC RULE 4.41 - HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN.
All trades, patterns, charts, systems, etc., discussed in this blog http://forexeducationperspective.blogspot.com/ are for educative and illustrative purposes only and not to be construed as specific advisory recommendations for actual trades. Disclaimer - http://forexeducationperspective.blogspot.com/ bears no responsibility for the trading actions of its readers
Pieter Bergli - DeLoren Trust Holdings
A non-profit commitment to provide education on the properties of currency markets
Forex market commentaries and media reports for free
Disclaimer - U.S. Government Required Disclaimer - Commodity Futures Trading Commission
Futures and Options trading involves risks of losses. No representation is being made that any reader and account will or is likely to achieve profits or losses similar to those that are being discussed on this blog http://forexeducationperspective.blogspot.com/. The past performance of any trading system or methodology discussed is not necessarily indicative of future results.
CFTC RULE 4.41 - HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN.
All trades, patterns, charts, systems, etc., discussed in this blog http://forexeducationperspective.blogspot.com/ are for educative and illustrative purposes only and not to be construed as specific advisory recommendations for actual trades. Disclaimer - http://forexeducationperspective.blogspot.com/ bears no responsibility for the trading actions of its readers
