US Dollar Gains Ahead of Heavy Event Risk

Source: Daily FX

The US dollar gained against most of the major currencies ahead of the market moving data scheduled for tomorrow, and pushed investors to lower their risk appetite as they raised bets of a 25bp rate cut. As a result, the greenback advanced against most of the commodity currencies expect for the Canadian dollar, which held up amid falling oil prices. The low yielding Yen also strengthened against the US dollar - sparked by a rise in risk aversion, while the Swiss franc inched lower to trade at 1.03. The European currencies continued to lose ground against the US dollar as negative sales data for the UK and Euro-Zone lowered the growth prospects for both countries and pulled back the British Pound and Euro to 1.96 and 1.55, respectively.

Fresh housing data lowered the growth prospects for the US economy as downside risks continued to surface, with more consumers voicing their concerns about the current economic situation. The S&P/CaseShiller Composite fell 12.7 percent, the sharpest decline since record keeping began in 2001. Financial instability paired with tightening credit conditions has made it increasingly difficult for the housing market to get back on its feet, with home prices persistently falling as the inventory of unsold homes reached record levels. Falling consumer confidence has also added damped the growth prospects for the economy as the Conference Board’s Consumer Confidence index fell for the fourth consecutive month to dip to a five year low of 62.3 from 64.5. Consumers continue to feel the economic strains as raging food and energy costs limit their spending capabilities, with growth prospects looking increasingly bleak as economic activity deteriorates.

Negative economic data sparked another round of bearish sentiment in the stock markets and dragged the markets into negative territory after early morning gains. As a result, the DJIA shaved 39.81 points to hold at 12,831.94 points, with pharmaceutical giant Merck taking the biggest loss. The broader S&P500 fell 5.43 points to 1,390.94 points, with 127 stocks falling to a new 52 week low.

The rise in risk aversion spurred increased demands for long-term US Treasuries, while demands for short-terms bonds wavered as the economic outlook for the US remains dreary. As a result, the benchmark 10-Year yield dropped to 3.823 percent from 3.831, while the 2-Year yield rose to 2.362 percent from 2.350.

Looking ahead, we expect heightened US Dollar volatility to follow early on in the morning as 1st quarter GDP figures are scheduled for release at 12:30 GMT, and expect annualized growth to inch lower to 0.4 percent from 0.6 percent. Following the release, our attention will be turned to the FOMC rate decision at 18:15 GMT, and forecast the central bank to lower key rates by 25bp to 2.00 percent.

Euro Mired Near Multi-Week Lows

Source: Forexnews.com

The euro continues to struggle against the dollar, falling to its lowest level in 3 ½ weeks at 1.5541 amid weakness in the earnings of Deutsche Bank. Economic data from the Eurozone will be closely analyzed, including Germany’s April labor report, Eurozone March labor report, Eurozone sentiment surveys and flash inflation. Germany’s unemployment rate is seen holding steady at 7.8%, while the unemployment change is estimated at minus 30k versus minus 55k. The March Eurozone unemployment rate is expected to remain unchanged at 7.1%.

Pound Slumps on Soft Housing Data

Source: Forexnews.com

The sterling slumped across the board, falling to 203.52 versus the yen at 1.9678 against the dollar. The catalyst for the decline in the pound was economic data reinforcing the continued weakness in the UK housing market. Mortgage approvals in March fell to its lowest levels since 1993 at 64k, exceeding the estimated decline to 65k from 73k in February. Mortgage lending fell to 6.93 billion sterling, versus 7.45 billion sterling a month earlier.

In the coming session, housing data will again garner the market’s attention with April nationwide housing prices due out at 2:00 AM. Home prices are seen posting a 0.5% decline versus a 0.6% fall in March, while posting a flat reading compared with a 1.1% increase in the previous year.

We continue to remain bearish on the sterling, with initial support against the dollar seen at 1.9650, followed by 1.96 and 1.9540. Additional support is seen at 1.95, backed by 1.9470 and 1.9430. On the upside, resistance is seen at 1.97, followed by 1.9750 and 1.98. Subsequent ceilings will emerge at 1.9840, followed by 1.9880 and 1.9940.

Dollar Mixed Ahead of Fed

Source: Forexnews.com

The greenback was mixed in the Tuesday session, advancing versus the euro while relinquishing gains against the sterling and the yen. The economic calendar saw the release of the April consumer confidence survey, which declined to 62.3, albeit less than expected, from 64.5 from March.

The major currency pairs will likely trade within range ahead of the FOMC policy decision tomorrow afternoon. We expect the Fed to ease policy by 25-basis points to 2.0% while maintaining a downbeat outlook on the economy similar to its previous statement. Nonetheless, we anticipate the Fed to leave policy unchanged for the remainder of the year after this week’s rate cut given the aggressive easing that has already materialized.

My EUR/USD Trade (29-04-2008) --- Update (Final)

*Attached chart (After). Click on it for the enlarged version.

Hello everyone,

This post is an update from my (previous trade update) >>> Click Here!

I just came home. Went out to meet my dad.

Now it is about 01:55am (Singapore Time) | 05:55pm (GMT).

My Protective Stop has been hit at 09:49pm (Singapore Time) | 01:49pm (GMT).

20pips profit for this trade :)

Peace and trade safely everyone...

My EUR/USD Trade (29-04-2008) --- Update (1)

Hi everyone,

This post is an update from my previous trade >>> Click Here!

Currently, 03:34pm (Singapore Time) | 07:34am (GMT), I am around 40pips in the money.

Shifted my Protective Stop deeper to 1.5590 (20pips in the money) and my Target Profit to 1. 5460 (150pips).

Will update as this trade goes by :)

Peace and trade safely everyone...

My EUR/USD Trade (29-04-2008)

*Attached chart (Before). Click on it for the enlarged version.

Hello everyone,

I am still on a downside bias on the EUR/USD. Shorted it at 1.5610 at 2:58pm (Singapore Time) | 6:58am (GMT).

I waited for price action, my resistance level at 1.5670, was not able to be broken. followed by a 1:00pm (Singapore Time) | 5:00am (GMT) downclose candle and a follow through movement the next hour. although there are candle patterns that are popping out, they are invalid patterns.

My analysis was supported by 4hour Stochs kissing on the downside. 1hour, Fast [Ash C Wave] kissing on the downside, MAs kissing down, [Ash Cross Over] cross below. [Ash Down Up], think red bar.

My Stop Loss was very conservative due to current market condition at 1.5625 (15pips) and Target Profit at 1.5560 (50pips). Risk : Reward = 15 : 50 = 1 : 3.3

Currently, market has moved in my favour, around 25pips in the money. Have shifted my Stop Loss to Protective Stop at 1.5609 (1pip in the money).

Will update as this trade goes by :)

Peace and trade safely everyone...

My EUR/JPY Trade (25-04-2008) --- Update (Final)

*Attached chart (After). Click on it for the enlarged version.

Hello :)

This an update from my previous trade >>> Click Here!

Protective Stop was hit at 2:01pm (Singapore Time) | 6:01am (GMT), while I was out buying my sandwich at Subway. :P

1pip profit :)

Peace and trade safely everyone...

My EUR/JPY Trade (25-04-2008)

*Attached chart (Before). Click on it for the enlarged version.

Hello everyone,

I shorted the EUR/JPY today (25-04-2008) at the price line of 163.54 at 11:46am (Singapore Time) | 3:46am (GMT).

Fundamental wise, EUR weakness. Technical wise, price action. Support by 1hr chart Slow [Ash C Wave] down, Fast [Ash C Wave] Kissing, [Ash Cross Over] down.

Stop Loss at 163.77 (23pips) and Target Profit 162.70 (84pips). Risk : Reward = 23 : 84 = 1 : 3.6

Currently, market has mover a bit in my favour at least enough room to shift my Stop Loss.

My Stop Loss has been shifted to Protective Stop at 163.53 (1pip in the money).

Will update as this trade goes by :)

Peace and trade safely everyone...

German Business Confidence Falls

Source: Daily FX

The IFO Institute's measurement of German business confidence fell for the first time in four months. Rising energy costs on the back of record oil prices and a strong Euro has dimed the outlook for Europe's biggest economy. The business climate index fell to 102.4 from 104.8; current assessment fell to 108.4 from 11.5 and expectations to 96.8 from 98.4. Despite their waning confidence, many believe that the economy remains robust and that it is headed for a period of moderation versus a significant slowdown. German companies are benefitting from strong demand from emerging markets Russia, China and Brazil. Although many feel that a slowdown in Europe will alleviate inflationary pressures, the ECB has remained staunch in its hawkish stance. However, after recent comments hinting that a future rate hike was in store, several committee members including Bonello have refuted those notions.

Can the Mortgage Bailout Revive Credit Markets and the British Pound?

Source: Daily FX

Over the past eight months, the global credit market has been roiled by the subprime meltdown in the US. However, until recently, many had considered the problem largely isolated to the US financial markets. This theory has been summarily disproved though as the contagion has clearly spread to the economies of both industrial powerhouses and emerging markets. And, in the wide-spread devastation, no economy seems to be as vulnerable to a sustained credit crunch as the UK.

The nation’s housing market is already suffering its worst downturn since the last recession and the financial sector has been riddled with massive write downs. With the consumer and general economic growth the next dominos to fall, policy officials have finally stepped in to unfreeze the credit market and avert a possible recession by offering to swap bank’s government bonds for their mortgage-linked securities. Will this plan thaw credit markets or is this move too little, too late? That likely depends on the details of the plan.

The Special Liquidity Scheme
Dubbed a ‘Special Liquidity Scheme’, the central bank’s planned liquidity injection is similar to recent policy operations in the US. In the plan, devised by the Bank of England and Treasury (and further backed by the Government), the central bank will temporarily swap high quality mortgage-backed assets for UK Treasury Bills (often referred to as Gilts). Theoretically, this would reassure the markets as to the solvency of both lenders and borrowers and encourage the regular movement of money once again.

However, the overall effectiveness of this plan and its burden on the taxpayers really relies on the proposed details. According to the BoE, there are three key features to this scheme:

1. Swaps are Long Term: The first element is that each asset swap will be for a relatively long term. Each swap will last for the period of one year and may be renewed (at the bank’s discretion) for each year for an additional two years. This point alone will be essential as the credit market crunch will not likely be worked through over the 28-day term that the Federal Reserve makes its TSLF loans for.

2. Banks Keep Losses: The second, highlighted point is that the risk of losses through the loans will remain with those banks that swap their securities for gilts. This aspect of the loan is specifically tailored to protecting the government and taxpayers’ money. The guarantee that the swap provides comes from the public coffers as the government will hold the far more risky mortgage-backed assets. In essence, this will ensure that the BoE is helping stabilize the financial markets without condoning the moral hazard of taking too much risk and encouraging a similar situation in the future.

3. Debt Only Up to 2007: The final point looks to boost the effectiveness of the scheme while simultaneously avoiding the unwanted effect of encouraging excessive risky lending. Policy officials will only allow swaps on assets that were existent at the end of 2007. No assets taken after that point can be used as collateral. This will ensure that banks won’t finance new lending with the lending facility; and instead, the scheme will be aimed specifically at helping unfreeze the credit market.

A Flawed Plan?
Every plan has its faults; and this one happens to have many. Perhaps the greatest shortfall to this proposal is its estimated size. While the Bank of England has not offered a definitive number on how much monetary relief they will offer liquidity-starved banks, they have forecasted a ball park figure of £50 billion. This is a meager figure considering the size of the UK credit market. Furthermore, since the discount window will be open for six months, this sum could be spread rather thin. What’s more, considering the credit market freeze is a global problem, policy makers will have to have an impact on global confidence to truly make a difference. The estimated limit will no doubt be hit relatively soon; and the BoE’s commitment to saving the market will depend on their willingness to expand their lending efforts.

Another major stumbling block for the liquidity scheme is found in the effort to limit the central bank’s exposure to risk in the swap. The BoE’s insistence that only assets that were held in the bank’s book before the end of 2007 will do its part in preventing risky, speculative lending going into the future. On the other hand, banks can secure their old, hard to value loans and still take on additional risk going forward – essentially funding future speculation. And, looking more closely at the details of the plan, this may actually be the least oppressive clause. Another issue is that the BoE will swap for only high-quality assets including the AAA-rated UK and European residential mortgages. The true problem for the credit market are those assets that have lower ratings and are therefore more risky and harder to valuate. The most threatening issue through is the hair cuts (fees charged for the swap) banks will have to take on the lending. Lending rates will run between 12 and 22 percent. In addition, the bank’s will need to provide assets with significantly greater value than the Treasury Bills at all time and they will need to provide more when the value of their collateral falls. Not only will this be a great expense, it will carry a stigma with it that may discourage bank’s from seeking help as it could be a signal to the market that the firm is in trouble.

A Global Problem
Looking beyond the confines of UK financial markets, we need to remember that the credit crisis is a global issue. As suggested above, the liquidity scheme has to contend with unfavorable lending conditions the world over. As such, even if British banks find comfort in the swap, it may still be difficult to price risky assets and cross-boarder lending will still be essentially frozen. This point is characterized particularly well through the failure of other central bank’s efforts to revive lending through their own liquidity injections. The Federal Reserve has steadily increased its own auction facilities to the current $200 billion TSLF plan while adding the condition that mortgage-backed securities and other so-called ‘toxic’ structured debt could be used as collateral. The ECB has been even more accommodative by recently extending its loans to a six-month period; and they have always allowed mortgage-backed assets as a guarantee.

Conclusion
Moving forward, the Bank of England’s efforts to restore lending may only be a drop in a very big bucket; but the help is certainly needed. The United Kingdom’s economy has already been roiled by the credit crunch; but conditions could get much worse. While the housing market has already slumped and financial services have been brought to the edge, the consumer has been relatively resilient. However, considering Britian is the most indebted nation in the world with household debt totaling £1.19 billion and 84 percent of GDP (compared to 75 percent in the US), the economy and pound could be wracked be the next leg of the credit meltdown. On the other hand, a return to confidence could be just as contagious as the fear that froze the market; so traders need to keep aware of the appetite for risk and the health of the credit market.

Daily Market Update by Daily FX (24th April 2008)

Source: Daily FX

USD
After hitting a record low against the Euro on Tuesday, there has been little follow through selling in the US dollar, leaving many traders wondering whether this may be a pause before further losses or a potential bottom. Although we are long term dollar bears, the break of 1.60 is far from impressive. This indicates that there isn't much speculative interest in taking the Euro higher in the near term, especially as economic data and official comments start to turn against the Euro and in favor of the US dollar. Earlier this week we had better than expected US housing market numbers. We would not be surprised to also see a recovery in new home sales. Even though US durable goods will be pressured by the sales of furniture and electronics, Boeing's incredibly solid end of quarter earnings and their expectations of another strong year suggests that sales of non-defense aircraft could be firm. As for the Eurozone, we expect German business confidence to deteriorate materially (discussed in Euro section). Fed fund futures are currently pricing in an 82 percent chance of a quarter point rate cut next week with the remaining 18 percent probability in favor of no rate cut at all. This is a sharp departure from just a week ago when the market was pricing in a 76 percent chance of a 25bp cut and a 24 percent chance of a 50bp cut. The only reason for this dramatic shift in expectations is the increased inflationary pressures. A week ago, oil prices were trading at $113 a barrel and yesterday it hit an intraday high of $119.90 a barrel. The dollar should continue to recover for the rest of the week, but the party may end the following week when we have the Federal Reserve interest rate decision and non-farm payrolls due for release. We believe that the market may be under pricing the degree of Fed rate cuts because the problems in the US economy are far from over. Non-farm payrolls should continue to drop while consumer spending will probably slow, leaving the Federal Reserve with a lot of work ahead of them.

EUR
The Euro has failed to extend its gains beyond 1.60 and we believe that another day of losses may be in store for the single currency. More signs of weakness in the Eurozone economy are beginning to reveal themselves. Even though service sector PMI improved in the month of April, manufacturing sector PMI deteriorated. This suggests that German business confidence could have also decreased this month as indicated by the ZEW survey. A little watched report called the Belgium Business Sentiment Index also tends to have a strong correlation with German IFO (chart). The index fell to a 2.5 year low in the month of April with the drop being the steepest on record. A large decline in German business confidence would be exactly what the Euro needs for a more meaningful turn. Meanwhile ECB member Noyer backtracked the comments that he made yesterday, which drove the EUR/USD to a record high. He said that the market misinterpreted his words and that the ECB is not looking to hike interest rates. For the time being, don't expect them to lower rates either.

GBP
Over the next 2 trading days, the big action should be in the British pound. We are expecting retail sales tomorrow followed by the first quarter GDP report on Friday. The deterioration in the UK housing market and the UK economy in general will weigh on consumer spending, while the GDP numbers may be partially dependent upon how bad retail sales fared in March. Unfortunately the minutes from the latest monetary policy meeting failed to provide any clarity on how the central bank may vote at the next meeting because the committee was split 3 ways. Six of the nine members voted in favor of the 25bp rate cut, 2 members voted for no cut at all while 1 member voted for a 50bp cut. As a group, they were concerned about everything from growth to credit markets to inflation. Looking ahead, the only things that will shed more light on where the BoE stands would be tomorrow's retail sales report.

JPY
The Japanese Yen crosses were mixed today with USD/JPY rallying but many of the other yen crosses dipping despite a 42 point rally in the Dow. After breaking higher last Friday, there has not been much follow through in US equities, which leaves many traders nervous about whether risk appetite is really here to stay. The latest merchandise trade balance report was weaker than expected, but the surplus still increased last month. The strength of the Japanese Yen is beginning to take a toll on exports, particularly in the electronic components and machinery sector. Imports on the other hand rose 11 percent, mainly due to the rise in oil prices.

My EUR/USD Trade (23-04-2008)

*Attached charts (Before) & (After). Click on it for the enlarged version.

Hello everyone,

Today [23-04-2008], I was looking forward to short the EUR/USD.

At 6:31pm (Singapore Time) | 10:31am (GMT), I shorted EUR/USD at the price line of 1.5965.

It was my price action, no candle stick criteria. Supported by 4hourly chart [Ash Cross Over] was down. 1hour chart was a little contradicting, [Ash Cross Over] was not pointing down, but the Fast [Ash C Wave] was down and Slow [Ash C Wave] was kissing and [Ash Down Up] was picking up momentum on the down side.

My Stop Loss was at 1.5987 (22pips) and Target Profit at 1.5880 (85pips). Risk : Reward = 22 : 85 = 1 : 3.8

After I opened my position and placed my Stop Loss and Target Profit. I basically didn't have time to look at it. Had something to do and then after, meeting my potential partners on a business we are setting up. Car polishing centre :P So, when it is up and running, maybe we can set something up like a special membership for drivers that are loyal readers of Forexnewspaper.blogspot.com :P Hahaha!!! With approval from my partners of course!

Anyway, I just got home. It is now like 1:27am (Singapore Time) | 5:27pm (GMT). My Target Profit was hit at 9:32pm (Singapore Time) | 1:32pm (GMT).

85pips profit for this trade :)

Peace and trade safely everyone...

US Dollar Plunges To New Low Against Euro...

Source: Daily FX

Fundamental data for the US economy pressed on the struggling dollar and led the Euro to hit an intraday high of 1.6018. The US dollar slid against all of the major currencies except for the Canadian dollar, and took the biggest loss against the British Pound as the pair retraced back to 1.99. The low yielding Swiss franc and Yen advanced against the US dollar as the pairs fell to 1.00 and 102.9, respectively, with the higher yielding Australian and New Zealand dollar following as oil prices hit a record high of $119.90 a barrel.

Current economic conditions continues to hamper growth prospects as additional downside growth risks surfaced from the housing market, with manufacturing activity taking a dip due to the weakness in the labor market. The Existing Home Sales index declined 2.0 percent from the month prior as banks continue to tighten lending practices, while the House Price index posting an unexpected gain as it rose to 0.6 percent from minus 1.1 percent. The Richmond Fed Manufacturing index also added to growth concerns as cost-cutting practices led to a fall in manufacturing employment, and lowered the index to 0.0 from 6.0.

Bearish sentiment took hold of the stock markets as DuPont and Texas Instruments lowered their second quarter earnings forecast, and dragged down Yahoo and Apple shares ahead of their first quarter earnings report. As a result, the DJIA dropped 104.79 points to 12,720.23 points, with 23 of the 30 components posting a decline. The broader S&P500 fell12.23 points to 1,375.94 points, with 228 stocks falling to a new 52 week low.

Mounting short-term downside risks moved risk adverse investors into the safe have of risk free bonds, and increased the demands for long-term bonds. As a result, the benchmark 10-Year yield fell to 3.695 percent from 3.720 percent, while the 2-Year yield surged to 2.193 percent from 2.172 percent.

Looking ahead, the Bank of England Minutes will kick off the eventful day at 8:30 GMT, with our focus turning to the Reserve Bank of New Zealand's rate decision at 21:00 GMT. The MBA Mortgage Applications index will be the only US data expected for tomorrow, and will be followed by the Canadian Retail Sales index at 12:30 GMT.

Daily Market Update by Daily FX (23rd April 2008)

Source: Daily FX

USD
It has been a record breaking day in the financial markets with the US dollar falling to a new all-time low and oil prices hitting a record high above $119 a barrel. When it comes to oil and the US dollar, it is difficult to determine which is the primary driver because the dollar's weakness pushes oil prices higher while oil prices hurts the outlook for the US economy. Although it can be argued that higher crude prices are inflationary, it is not that simple because the Federal Reserve cannot raise interest rates to combat inflation. With the market already pricing in only a quarter point rate cut, to forgo a rate cut completely would send a message to the markets that the Federal Reserve is not quite ready for. At this time, the Fed's bigger problem is the pressure that $5 gas prices may have on consumer spending and corporate profitability. The pocketbooks of US consumers are getting pinched by the day as prices rise globally. This morning, there have been reports that Mattel is raising toy prices and even the MTA (Metropolitan Transportation Authority) here in NY is planning to raise the price of alcohol, soda and snacks for the first the first time in 4 years; the price hike of 25 percent is by no means shallow. Housing market numbers were released this morning and they were not as bad as analysts had feared. The absolute number of existing homes sold was slightly more than expected even though the drop on a percentage basis was greater. House prices actually ticked higher which is a relief for the housing market even though that relief will probably be temporary. California just reported the highest level of mortgage defaults in 15 years, reflecting the severity of the problems in the US real estate market. Expect the US economy to get worse before it gets better.

EUR
The fourth time is the charm for the Euro as it finally pierces the 1.60 level against the US dollar. Despite slightly better than expected existing home sales in the US, a rebound in house prices, and news that the German Banking Association bailed out Duesseldorfer Hypothekenbank AG after a string of mortgage losses, the market refuses to give up its voracious appetite for Euros. This continual rise in inflationary pressures raises the risk of a rate hike from the European Central Bank. This morning, ECB member Noyer said that the central bank will do what is needed to control inflation, including raising interest rates. Although he tried to temper that comment by saying that rates are currently appropriate, the seed has been planted. Tomorrow's service and manufacturing PMI numbers will shed more light on how well the Eurozone economy is holding up given current market conditions. Interestingly enough, there are not as many option barriers according to the volatility smile at 1.60 as there was at 1.50. This suggests that extension may not be as high. When the Euro broke 1.50 it rallied another 144 pips on the very same day and then added 300 pips over the next few weeks with virtually no retracement. Therefore the power of the move above 1.60 will not be as strong as the move above 1.50. In fact, 1.60 could even be a near term top.

GBP
Fresh from yesterday's trading loss, on the back of rising criticism about BoE's GBP50 billion swap, the British Pound regained posture against the US Dollar, rallying by 150 pips. In light of the Royal Bank of Scotland's $24 billion sell of shares and the BoE's attempt to increase liquidity in order to boost the ailing housing market, speculations run rampant that the worst is yet to come for the once resilient UK economy. Today, Finance Minister Alistair Darling is set to meet with key mortgage lenders, in hopes of convincing them to cut costs of home loans and find ways of helping people refinance their mortgages. Investors eagerly await this month's central bank minutes set to release on Wednesday, in hopes of finding a silver lining, in terms of a future rate cut. As the economy trudges along, it remains to be seen what sorts of surprises the government pulls out of its black hat, but it can be assumed that it will be awhile before the UK economy start chugging smoothly.

JPY
Fresh from yesterday's trading loss, on the back of rising criticism about BoE's The Japanese Yen continued its lead against the US Dollar, as investors ushered in positive economic release from the world's second largest economy. Supermarket sales figures rose for the second month in a row, due to rising food costs, causing investors to remain optimistic about future growth prospects. With Democratic Party Japan pushing for higher minimum wages, and the retention of the gasoline tax cut beyond April, expect consumer spending to recover, which could help Japan revive at a quicker pace than expected. Looking ahead, Merchandise Trade Balance and CPI figures should help the Yen gain against major currencies.

Last minute addition to the Global Events Calendar...

Hello everyone,

[21-04-2008], at 4:00pm (Singapore Time). This is a last minute addition to the Global Events Calendar.

GBP - [BOE Special Liquidity Announced]
*Description - The Bank of England (BOE) will issue a statement regarding their "Special Liquidity Scheme" designed to allow banks to swap temporarily their high quality mortgage-backed and other securities for UK Treasury Bills.

Peace and trade safely everyone...

Global Events Calendar [21-04-2008] - [25-04-2008]

*Time displayed is based on Singapore Time (GMT+8:00)

A few things to be a little careful of:

1) GBP [MPC Meeting Minutes] - On [23-04-2008] at 4:30pm.

2) USD [Unemployment Claims] - On [24-04-2008] at 08:30pm.

3) AUD [Holiday) - On [25-04-2008], it will be a whole day event, Anzac Day.

Peace and trade safely everyone...

----------------------------------------------------------------------------------
Global Events Calendar [21-04-2008] - [25-04-2008]
----------------------------------------------------------------------------------

Monday [21-04-2008]
7:01am---GBP Rightmove House Price Index m/m
7:50am---JPY Tertiary Industry Activity Index m/m
3:15pm---CHF PPI m/m
4:00pm---EUR IMF Press Conference
5:00pm---EUR ECB President Trichet Speaks

Tuesday [22-04-2008]
1:30am---USD Fed Governor Kroszner Speaks
2:15pm---CHF Trade Balance
7:00pm---GBP MPC Member Besley Speaks
10:00pm--USD Existing Home Sales
10:00pm--USD House Price Index q/q
10:00pm--USD Richmond Fed Index

Wednesday [23-04-2008]
7:50am---JPY Trade Balance
2:45pm---EUR French Consumer Spending m/m
3:30pm---EUR German Manufacturing PMI (p)
3:30pm---EUR German Services PMI (p)
4:00pm---EUR Manufacturing PMI (p)
4:00pm---EUR Italian Retail Sales m/m
4:00pm---EUR Services PMI (p)
4:30pm---GBP MPC Meeting Minutes
4:30pm---GBP BBA Mortgage Approvals
5:00pm---EUR Industrial New Orders m/m
10:30pm--USD Crude Oil Inventories

Thursday [24-04-2008]
1:00am---GBP MPC Member Sentance Speaks
7:50am---JPY All Industries Activity Index m/m
7:50am---JPY CSPI y/y
4:00pm---EUR German Ifo Business Climate Index
4:00pm---EUR German Ifo Business Expectations Index
4:00pm---EUR Current Account
4:30pm---GBP Retail Sales m/m
6:00pm---GBP CBI Industrial Trends Orders
8:30pm---EUR ECB President Trichet Speaks
8:30pm---USD Core Durable Goods Orders m/m
8:30pm---USD Durable Goods Orders m/m
8:30pm---USD Unemployment Claims
10:00pm--USD New Home Sales
10:00pm--USD Fed General Counsel Alvarez Speaks

Friday [25-04-2008]
[Whole Day Event]---AUD Holiday: Anzac Day
7:50am--------------JPY Core CPI y/y
7:50am--------------JPY Core Tokyo CPI y/y
2:00pm--------------EUR German Import Price Index m/m
4:00pm--------------CHF SNB Chairman Roth Speaks
4:00pm--------------EUR M3 Money Supply y/y
4:30pm--------------GBP GDP q/q (p)
4:30pm--------------GBP Index of Services 3m/3m
10:00pm-------------USD Consumer Sentiment (r)

----------------------------------------------------------------------------------

My EUR/USD Trade (17-04-2008) --- Update (Final)

*Attached chart (After). Click on it for the enlarged version.

Hello everyone,

An update from my previous trade >>> Click Here!

Guess I shift my Protective Stop a little too early :P What ever it is, this is part and parcel of trading :) Sometimes, you win and sometimes you don't and market still goes your way :P Hahaha!!!

For my case, late last night, after seeing the movements, I was on the conservative side and shifted my Protective Stop as mentioned early.

Was not around the whole day, had to attend an event. My Protective Stop was hit today (18-04-2008), at 2:34pm (Singapore Time) | 6:34am (GMT) before going my way.

1pip profit :P

Peace and trade safely everyone...

My EUR/USD Trade (17-04-2008)

*Attached chart (Before). Click on it for the enlarged version.

Hello everyone,

My trade on the EUR/USD today (17-04-2008).

I shorted this pair at the price line of 1.5940 at 6:32pm (Singapore Time) | 10:32am (GMT).

What I saw was my price action, candle pattern and chart pattern. "Double-Top" at my resistance (1.5968-1.5970) and a "Reverse Hanging Man". To support my analysis, Fast [Ash C Wave] down, MAs down, [Ash Cross Over] down. Double checked with 4hourly, the [Ash Cross Over] are also down. Further price action wise, I waited for market to break below my 6ma and then I waited for the price that I want, which is 1.5940.

My Stop Loss was at 1.5975 (35pips) and Target Profit at 1.5800 (140pips). Risk : Reward = 35 : 140 = 1 : 4

From the time I placed my trade, I went out. I just got home and now it is like 1:04am (Singapore Time) | 5:04pm (GMT).

Currently, I am around 20-25pips in the money but I saw how price has reacted, I wish to be more conservative. I have shifted my Stop Loss to Protective Stop at 1.5939 (1pip in the money).

Will update as this trade goes by :)

Peace and trade safely everyone...

My GBP/USD Trade (15-04-2008) --- Update (Final)

*Attached chart (After). Click on it for the enlarged version.

Hello everyone,

An update from my previous trade >>> Click here!

My Protective Stop was hit today (16-04-2008) at 2:14pm (Singapore Time) | 6:14am (GMT).

20pips profit for this trade :)

Peace and trade safely everyone...

My GBP/USD Trade (15-04-2008)

*Attached chart (Before). Click on it for the enlarged version.

Hello everyone,

My trade today on the GBP/USD.

I shorted this pair at 2:33pm (Singapore Time) | 6:33 am (GMT) at the price line of 1.9700.

What I saw was that, own analysis and price action and how market has reacted on Monday. To support my analysis, price has broken the [Ash Weekly Pivot]. Fast [Ash C Wave] already down, Slow [Ash C Wave] Kissing, MA already down and [Ash Cross Over] has crossed down. To ice the thing, [Ash Down Up] thick red bar. Double-checked on the 4hourly, the [Ash Cross Over] is down as well.

Waited for price to go back to 1.9700 and I shorted it.

My Stop Loss at 1.9740 (40pips) and Target Profit at 1.9535 (165pips). Risk : Reward = 40 : 165 = 1 : 4.125

Currently, market has moved in my favour and I am in around 70pips in the money. Shifted my Stop Loss to Protective Stop at 1.9680 (20pips in the money).

Will update as this trade goes by :)

Peace and trade safely everyone...

Osamex FX Market Video Review and Analysis [13-04-2008]

Hi guys,

Finally! Thank god! Finally! Osamex has got down to do his first video on Forex Market Review and Analysis. This is his first video analysis for us. He has done a quick analysis and we hope he will improve on his works :)

Enjoy the video analysis!!!

Warmest Regards,
ForexNewsPaper.blogspot.com


[Part 1 of 3]



[Part 2 of 3]



[Part 3 of 3]

Global Events Calendar [14-04-2008] - [18-04-2008]

*Time displayed for the Global Events Calendar is based on Singapore Time (GMT+8:00)

----------------------------------------------------------------------------------
Global Events Calendar [14-04-2008] - [18-04-2008]
----------------------------------------------------------------------------------

Monday [14-04-2008]
7:50am---JPY Monetary Policy Meeting Minutes
4:30pm---GBP PPI Input m/m
4:30pm---GBP PPI Output m/m
5:00pm---EUR Industrial Production m/m
8:30pm---USD Core Retail Sales m/m
8:30pm---USD Retail Sales m/m
10:00pm--USD Business Inventories m/m

Tuesday [15-04-2008]
3:15am---USD Fed Governor Warsh Speaks
5:30am---EUR ECB President Trichet Speaks
7:01am---GBP RICS House Price Balance
7:01am---GBP BRC Retail Sales Monitor y/y
2:45pm---EUR French CPI m/m
4:30pm---GBP CPI y/y
4:30pm---GBP Core CPI y/y
4:30pm---GBP DCLG House Price Index y/y
4:30pm---GBP RPI y/y
5:00pm---EUR German ZEW Economic Sentiment
5:00pm---EUR ZEW Economic Sentiment
8:30pm---USD Empire State Business Conditions Index
8:30pm---USD PPI m/m
8:30pm---USD Core PPI m/m
9:00pm---USD TIC Net Long-Term Transactions

Wednesday [16-08-2008]
1:00am---USD NAHB Housing Market Index
2:00pm---EUR German CPI m/m (r)
4:00pm---EUR Italian Trade Balance
4:30pm---GBP Average Earnings Index +Bonus q/y
4:30pm---GBP Claimant Count Change
4:30pm---GBP Unemployment Rate
5:00pm---EUR CPI y/y (r)
8:30pm---USD Core CPI m/m
8:30pm---USD Building Permits
8:30pm---USD CPI m/m
8:30pm---USD Housing Starts
9:15pm---USD Capacity Utilization Rate
9:15pm---USD Industrial Production m/m
10:30pm--USD Crude Oil Inventories

Thursday [17-04-2008]
12:30am----------USD Philadelphia Fed President Plosser Speaks
2:00am-----------USD Beige Book
12:30pm----------JPY Industrial Production m/m (r)
3:15pm-----------CHF Retail Sales y/y
4:00pm-----------EUR ECB Monthly Bulletin
5:00pm-----------CHF ZEW Expectations
5:00pm-----------EUR Trade Balance
8:30pm-----------USD Unemployment Claims
9:45pm-----------USD Fed Vice Chairman Kohn Speaks
10:00pm----------USD Philadelphia Fed Manufacturing Index
10:00pm----------USD Leading Index m/m
[Time Unknown]---CHF SNB Chairman Roth Speaks

Friday [18-04-2008]
2:00am---USD Dallas Fed President Fisher Speaks
1:00pm---JPY Household Confidence
2:00pm---EUR German PPI m/m
4:30pm---GBP M4 Money Supply m/m
4:30pm---GBP Public Sector Net Borrowing
----------------------------------------------------------------------------------

My EUR/USD Trade (10-04-2008) --- Update (Final)

*Attached chart (After). Click on it for the enlarged version.

Hello everyone,

An update from my previous trade >>> Click Here!

Seems like market is crazy.

My Protective Stop was hit (11-04-2008) at 10:47am (Singapore Time) | 2:47am (GMT).

20pips profit for this trade :)

Peace and trade safely everyone...

My EUR/USD Trade (10-04-2008)

*Attached chart (Before). Click on it for the enlarged version.

Hello everyone,

I shorted the EUR/USD at 11:03pm (Singapore Time) | 3:03pm (GMT) at the price line of 1.5795.

It broke my support at 1.5810 - 1.5800. Fast [Ash C Wave] down, MAs kissing, [Ash Cross Over] long down and [Ash Down Up] thick red bar. Making sure I wasn't chasing price, I double check with 4 hourly chart.

My method of "Ambush" is being applied again. Forseeing a break out before it happens with good money management.

My stop loss at 1.5820 (25pips) and target profit at 1.5685 (110pips), last week's [Ash Weekly Pivot]. Risk : Reward = 25 : 110 = 1 : 4.4

Currently, I am 60pips in the money. Have shifted my stop loss to protective stop at 1.5775 (20pips in the money).

Will update as this trade goes by :)

Peace and trade safely everyone...

Euro Jumps Higher

Source: Forexnews.com

The euro continued to climb higher against the sterling and dollar, rallying past the 0.80-level against the sterling and rising to 1.5863 versus the greenback. Economic data from the Eurozone released overnight saw Q4 GDP revised lower as expected to 0.4% q/q and 2.2% y/y. Meanwhile, Germany’s trade surplus improved in February to 16.4 billion euros, up from 16.1 billion euros a month earlier. Germany’s trade surplus beat out estimates for a decline to 15.8 billion euros and comes despite the recent strength in the single currency.

The ECB policy decision will be announced at 7:45 AM, with the Bank expected to leave rates unchanged at 4.0%. The subsequent press conference by ECB President Trichet will be closely analyzed for further hawkish comments highlighting the Bank’s focus on inflation. We expect the ECB to remain on hold until Q4 of this year, at which point we look for a 25-basis point rate cut. Nevertheless, with the FOMC and BoE both likely to cut rates, the ECB’s hawkish rhetoric will continue to provide a floor for the euro as it maintains its buoyant tone against the sterling and dollar.

Sterling Mired Near Record Lows vs Euro

Source: Forexnews.com

The pound continues to struggle versus the euro, slumping to fresh all-time low past the 0.80-figure at 0.8012. The sterling fared better against the greenback, recovering from its 6-week lows and recuperating above the 1.97-level to 1.9750. Although UK economic reports released overnight were better than expectations, markets continue look for the Bank of England to cut rates on Thursday morning.

The February industrial production edged out expectations, improving by 0.3% versus a 0.1% decline in the previous month and up by 1.3% compared with a 0.4% increase a year earlier. Meanwhile, the manufacturing output also beat out consensus forecasts, holding steady at 0.4% on a monthly basis and rising to 1.9% compared with a 0.6% a year earlier. Recall the sterling fell sharply following yesterday’s disappointing Halifax housing price survey, reaffirming sentiment that the BoE will soon ease policy to stimulate the economy.

In the session ahead, traders will look ahead to the February trade deficit, which is seen unchanged at 7.5 billion pounds. The non-EU deficit is expected to edge up to 4.3 billion pounds, from 4.29 billion pounds. Nonetheless, the key highlight will be the Bank of England’s monetary policy announcement at 7:00 AM. The Bank is largely expected to ease by at least 25-basis points to 5.0%. In addition to close focus on the magnitude of the rate move, traders will also closely scrutinize the accompanying Bank statement for clues on whether additional rate moves in the coming months can be expected.

We look for the sterling to remain softer against the euro and dollar heading into the meeting. Further, the BoE is likely to issue a more dovish assessment on the economy in light of housing and credit conditions in the UK, thereby pressuring the pound following the meeting.

USD Weighed Ahead of ECB, BoE

Source: Forexnews.com

The greenback was weaker across the board on Wednesday, falling to 1.5863 against the euro and 1.9790 versus the sterling. Commodities and energy rebounded with spot gold firming to $933 per ounce and crude oil rallying to a new high above $111 per barrel at $111.83.

The dollar continues to trade lower amid heightened expectations that the FOMC will cut by 50-basis points at the end of the month to 1.75%. Interest rate differentials will largely dictate currency movements in the coming session, with policy announcements by the ECB and BoE due out early Thursday.

My USD/JPY Trade (09-04-2008) --- Update (Final)

*Attached chart (After). Click on it for the enlarged version.

Hi everyone,

An update from my previous trade > Click Here!

My Target Profit was hit today (10-04-2008) at 10:22am (Singapore Time) | 2:22am (GMT).

70pips profit for this trade :)

Peace and trade safely everyone...

My USD/JPY Trade (09-04-2008)

*Attached chart (Before). Click on it for the enlarged version.

Hello everyone,

This is my first trade for the week. I was like "KO" the whole of Monday and Tuesday due to the painkillers that SGH (Singapore General Hospital) gave me for my lower back pain.

Anyway, I initiated a short position on the USD/JPY at the price line of 102.15 at 11:26pm (Singapore Time) | 3:26pm (GMT).

From the hourly, it looks as if I am chasing the market due to the [Ash Cross Over] has long cross below but I was double checking this point of entry with the 4hourly and weekly and I see that it is alright to enter :)

Also my method of "Ambush" is being applied again. To get in before breaking out of the closing wedge or market consolidation.

My Stop Loss at 102.35 (20pips) and Target Profit at 101.45 (70pips) close to this week's pivot. Risk : Reward = 20 : 70 = 1 : 3.5

Now I am around 60pips in the money. Have shifted my stop loss to protective stop at 101.95 (20pips in the money)

Will update as this trade goes by :)

Peace and trade safely everyone...

Can EUR/USD hold its 1.5750?

Source: Daily FX

It was a very quiet range bound night of trade as currency markets awaited the dual central bank decisions tomorrow from both the ECB and the BoE. In the meantime the EUR/USD firmed on slightly better than expected German Trade Balance data which showed a 16.9 Billion Euro surplus versus 15.7 Billion projected. Germany continues to do the yeoman's work for the region maintaining its level of exports despite the obstacle of higher exchange rates and remains the primary reason for EUR/USD strength.

News out of the broader region was not as friendly as the final reading of EZ GDP printed exactly in line with expectations showing that growth slowed in Q4 of last year. Most notable in the GDP report was the fact that consumption declined by -0.1% - its worst performance since 1995. With demand only slowing further in Q1 of 2008, the forecast for EZ GDP does not look promising and it is likely that the region will record another below trend number going forward.

Meanwhile news out of the UK was slightly more positive as both Industrial and Manufacturing production results improved this month. IP rose 0.3% vs. 0.1% expected while MP gained 0.4% vs. forecast of flat growth. The report helped boost the Pound above the 1.9700 level and pushed EUR/GBP lower by about 10 points in its immediate aftermath. The cross had scaled the record high 0.8000 level earlier in the night, but failed to hold it.

The positive surprise from the manufacturing sector was a welcome sign of relief to beaten up pound bulls and suggests that BoE will lower rates by maximum of 25bp at tomorrow's MPC meeting. Cable has been battered on assumption that the BoE will be the next major central bank to begin lowering rates in earnest, but tonight's data suggests that Mr. King and company may continue to follow their cautious policy path for a while longer. In any case with cable woefully oversold against the Euro at the 0.8000 level, the cross may be in for a correction as traders re-adjust their expectations.

With only Wholesale inventories on tap in the North American session trading may continue to be quiet ahead of tomorrow. The EUR/USD has had a difficult time clearing the 1.5750 level in the past several sessions and it will interesting to see if today's mildly positive tone will finally push it through that zone of congestion.

M I A...

Hello everyone,

I am sorry for being MIA for awhile.

Currently, I am in an episode of a very bad lower back pain.

Full story >>> Click Here!

Hopefully, I will be up and running soon :)

Warmest Regards,
Ash Ariffin

My EUR/USD Trade (03-04-2008) --- Update (Final)

*Attached chart (After). Click on it for the enlarged version.

Hello everyone,

Update from the previous post >>> Click Here!

My protective stop got hit at 8:36pm (Singapore Time) | 12:36pm (GMT).

30pips profit for this trade :)

Peace and trade safely everyone...

My EUR/USD Trade (03-04-2008) --- Update (1)

Hi everyone,

Update of my previous trade >>> Click Here!

Currently, I am around 70pips in the money. Have shifted my Protective Stop further to 1.5590 (30pips in the money)

Will update as this trade goes by :)

Peace and trade safely everyone...

My EUR/USD Trade (03-04-2008)

*Attached chart (Before). Click on it for the enlarged version.

Hello everyone,

My trade today on the EUR/USD. Shorted at the price line of 1.5620 at 4:30pm (Singapore Time) | 8:30am (GMT).

The reason being. 4hourly chart, Slow and Fast [Ash C Wave] down and [Ash Cross Over] down. I have decide to be on the seller side on EUR/USD for today on my trade plan.

Next, looking for an entry to sell on the hourly. Price action wise, cannot break above [Ash Weekly Pivot], crossed down my 200ma, it doesn't have strength cannot go up. Next, supported by Fast [Ash C Wave] down, Slow [Ash C Wave] Kissing, MAs down. More than enough story for me.

Actually, I am applying my "Ambush" method again. Using my proprietary probability calculation to get in before market break out of my closing wedge.

My Stop Loss at 1.5640(20pips) and Target Profit at 1.5475 (145pips). Risk : Reward = 20 : 145 = 1 : 7.25.

Currently, I am around 36pips in the money. Have shifted my Stop Loss to Protective Stop at 1.5619 (1pip in the money).

Will update as this trade goes by :)

Peace and trade safely everyone...

My GBP/USD Trade (31-03-2008) --- Update (Final)

*Attached chart (After). Click on it for the enlarged version.

Hello everyone,

An update on the GBP/USD Trade (31-03-2008) from the previous update --- Click Here!

This trade has just been closed. My Target Proft has been hit at [01-04-2008], 2:54pm (Singapore Time) | 6:54am (GMT).

105pips profit for this trade :)

Peace and trade safely everyone...

My GBP/USD Trade (31-03-2008) --- Update (1)

Hello everyone,

An update from my previous trade > Click Here!

Have shift my Protective Stop to 1.9820 (45pips in the money).

Will update as this trade goes by :)

Peace and trade safely everyone...

My GBP/USD Trade (31-03-2008)

*Attached chart (Before). Click on it for the enlarged version.

Hello everybody,

Last night, I initiated a short position on the GBP/USD at the price line of 1.9865 at 11:53pm (Singapore Time) | 3:53pm (GMT).

What I saw was a price action movements. Lower high followed by another lower high plus the the long rejection tail and it cannot clear above [Ash Weekly Pivot] and 200ma. This was supported by Slow [Ash C Wave] is still down, [Ash Down Up] thick red bar and [Ash Cross Over] is crossing down. To further enhance this analysis, under the 4hourly chart, [Ash Cross Over] is also crossing down.

My Stop Loss was at 1.9900(35pips) and Target Profit at 1.9760(105pips). Risk : Reward = 35 : 105 = 1 : 3

This morning, [01-04-2008], at around 10:30am (Singapore Time) | 2:30pm (GMT), I have shifted my Stop Loss to Protective Stop at 1.9863 (2pips in the money).

Will update as this trade goes by :)

Peace and trade safely everyone...