Will Durable Goods Slow the Risk Rally in Forex Trading?
July 28, 2010
Currency trading on the FX market
The risk rally got a good boost earlier today, with the sterling moving through the 1.56 level in currency trading. On top of that, the euro has gained in forex trading, reaching the 1.30 level.
However, the forex trading forecast question right now is whether or not the risk rally will continue. The latest durable goods news out of the U.S. has been disappointing, and it underscores the glacial speed of economic recovery.
With the pace of economic recovery in doubt, there are concerns that things may not continue as they are, and that the risk rally may slow. We will have to wait and see, though, how forex traders and investors respond to the latest interplay of economic data, policy leader testimony and company earnings reports.
See Also
- Looking for Currency Trading Trends
Forex trading forecast
Sterling Moves through 1.56 Level in Forex Trading
July 28, 2010
Risk rally on the currency market
The U.K. pound has moved on to the 1.56 level in currency trading on the FX market. As a result of help from the risk rally on the currency market, sterling has hit a 5-month high.
Bank of England officials have appeared before Parliament, and have assumed a more hawkish stance on the British economy. Committee members were mostly upbeat in their testimony, expressing cautious optimism, and forex traders responded by sending the sterling higher in forex trading.
The good news might be overruled, though, with concerns about durable goods orders in the U.S. So far the risk rally remains mostly intact, but concerns about the sluggish economic growth could result in its coming to an end.
See Also
- Sterling in Forex Trading
Currency trading on the FX market
London Session – July 28, 2010 7:05 AM
July 28, 2010
The inability of European stock market indices to hold their opening gains this morning suggest that underlying doubts about the global economic backdrop are proving difficult to shrug off. In line with the easing in stocks, the yen and the Swiss franc have won back a little ground today. In recent sessions, there were a number of signs of confidence ebbing back into the markets. The softer tone in both the JPY and the CHF earlier this week signalled improved risk appetite. In addition, the sell-off in gold, the upward creep in treasury yields yesterday and the tightening in the yield spread in peripheral European bond spread have all pointed to a more optimistic mood this week. The perception that the brunt of fears surrounding a European sovereign debt crisis may now be in the past is also detectable in the policy position of the ECB. Last week the ECB bought the lowest amount of bonds since its bond buying support program was launched in May. Euribor has also been ticking higher and ECB President Trichet has been vocal in his support for budgetary repair. The ability of EUR/USD to push back to the 1.3000 level this week is also a function of this more confident tone. While sterling’s recent gains have been built around stronger than expected UK data, the better tone of the pound this week was no doubt been fuelled by the more relaxed attitude with respect to risk. This morning cable’s upside bias appears to be stalling. Full text »
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Asia Session – July 28, 2010 3:37 AM
July 28, 2010
Earlier New York highs near 1.3040 were eroded heading into Asian trade as the EUR/USD remained mostly under the pivotal 1.3000 level for today’s trading session. The European currency fell victim to waves of profit taking as traders looked to lock in gains at recent 11 week highs. EUR/JPY slid from 114.40 to lows near 113.75, but eventually looked to end the day pretty much unchanged along with other cross yen pairs. The next question will be if the Euro has the continued momentum to test the next resistance levels in the 1.3090 ballpark. Full text »
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New York Session – July 27, 2010 5:51 PM
July 27, 2010
Today saw correlations breakdown across the board. US Equities were essentially flat (-0.1%), Precious Metals got hammered (Gold -1.8% and Silver -2.9%), the USD was stronger across the board since 8am EDT this morning; EUR/USD -40 pips, USD/CHF +35 pips, USD/JPY +55 pips, USD/CAD +90 pips, AUD/USD -45 pips and NZD/USD -60 pips (except vs. GBP/USD +50 pips), and there was notable weakness in two particular currencies; the Japanese Yen and Swiss Franc – we believe predominantly due to extreme risk averse positioning being unwound. Full text »
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Euro Higher in Forex Trading, But Can’t Get Through 1.30 Level
July 27, 2010
U.K. pound rally slows as well
The euro is higher in forex trading against the U.S. dollar, but still has trouble getting through the 1.30 level. Indeed, recent attempts following good economic data in the euro zone have been rebuffed.
GFT’s Boris Schlossberg reports in FX360 on the situation for the euro in forex trading:
The euro however, continues to struggle with the 1.3000 barrier with all attempts to break out higher being capped at 1.3020 for the time being. There was some speculation in the market that M&A flow (a German company buying a US asset ) may have been responsible for the slowdown in price action and perhaps when that order clears, the pair could make another run at the 1.3050 level.
Risk appetite in general is a little bit higher today, and the euro is being helped along by that. However, like the U.K. pound, the euro forex trading rally has slowed down. Getting through different resistance levels is proving difficult, since uncertainty about the economic picture still remains.
See Also
- Looking for Euro Help in Forex Trading
Currency trading on the FX market
Aussie Heads Higher in Forex Trading
July 27, 2010
Currency trading with AUD/USD
Risk appetite is putting in an appearance on the currency market today, and AUD/USD is benefitting. Asian stocks ended mixed today, but the Australian market was one of those showing gains. As a result, there is some momentum behind the Aussie in forex trading.
Indeed, matters are progressing reasonably well for the Aussie this morning as forex traders look for high yields, rather than for safe haven investments. With U.S. stock futures pointing to a higher open, and bullishness prevailing in general, it is little surprise that the Australian dollar is doing well.
Also helping to support the Aussie in forex trading is the fact that there is support from China. Even though China’s growth is moderating, there is still plenty of it to help the Australian economy — and the Aussie in forex trading on the currency market.
See Also
- Aussie in Forex Trading
Currency market news for forex traders
London Session – July 27, 2010 7:09 AM
July 27, 2010
Despite holding above the 1.3000 level for some hours this morning, the EUR is lacking the momentum to push above USD1.3020. The EUR has fared well vs the CHF and for the most part vs both the JPY and the GBP. Cable is meeting solid resistance at the USD1.5530 level despite the strong reading in the CBI retail survey. Full text »
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Asia Session – July 27, 2010 3:24 AM
July 27, 2010
The Euro remained elevated just off of two month highs after strong gains earlier in New York due in part to solid home sales data and positive earnings that propelled equities and risk higher. New York trading saw new home sales and better than expected earnings from Fed Ex add to the demand for risk, moving the EUR/USD to current levels just over 1.3000 from yesterday’s levels closer to 1.2900. However, after the dynamic moves witnessed earlier, the Asian session was light on excitement. Full text »
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New York Session – July 26, 2010 5:19 PM
July 26, 2010
Today’s price action was very typical of a Monday during the Mid-Summer; mostly range-bound outside of any major news announcements. Traders took the +23.6% headline U.S. June New Home Sales Number (MoM) and ran. EUR/USD rallied from 1.2940 to test the psychological 1.3000 level, EUR/JPY went from 112.70 to a high of 113.30, 10yr Treasury Yields moved from 2.99% to 3.03% and Gold traded nearly lower (89 to 80) on the back of this news. By the end of the day the S&P500 finished 1.12% higher and interestingly, the USD fell the most percent versus the NZD and AUD (commodity currencies), even though Gold finished the day .54% lower. Full text »
