Asia Session – October 31, 2010 11:40 PM

October 31, 2010

Asia kicked off the trading week little changed from the New York close in part because of lack of news or weekend developments.  Traders seemed subdued and content to   sit on their hands and wait for the immense amount of data and information expected during this rather busy week.  However, these traders would soon be caught off guard as USDJPY screamed higher making the dollar bid across the board.  Within seconds USDJPY went from dealing in the tightest of ranges near 80.40 to put in highs around 81.50.  The first assumption was that the BOJ was making another attempt at intervention and it sent panic into the hearts of JPY longs.  In a matter of minutes it was over, and USDJPY traded firmly below the 81 handle once more.  After the smoke cleared and no confirmation of central bank action materialized, chatter began that the moves were due to system traders. Full text »

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U.S. Dollar Higher on Risk Aversion

October 29, 2010

Economic worries in the euro zone send the greenback higher

The U.S. dollar is moving higher in forex trading on the currency market today as risk aversion sets in. Indeed, economic concerns in the euro zone have forex traders and investors rather jittery about the state of economic recover.

In Germany, retail sales appear to have collapsed — unexpectedly considering recent readings that indicate higher economic and business confidence. This collapse, paired with high euro zone unemployment, has many wondering about the region’s economic recovery.

As a result, forex traders are fleeing to safety. The U.S. dollar is gaining against every major currency, except the yen, as safe haven is sought.

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Euro Zone Unemployment Persists

October 29, 2010

Euro lower in forex trading today

Euro zone employment persists, remaining at the highest level in more than a decade. Even though economic confidence is slowly returning to the region, high unemployment persists.

As a result, some are beginning to question the validity of assertions that things are improving so much in the euro zone. Indeed, it seems folly for consumer and business confidence to be so high when unemployment continues.

Today, the euro is lower in forex trading against the U.S. dollar, hampered by renewed economic concerns and uncertainty about what the Fed will decide next week during its policy meeting.

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London Session – October 29, 2010 6:47 AM

October 29, 2010

A pivotal week for FX Full text »

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Asia Session – October 29, 2010 1:52 AM

October 29, 2010

The week, as well as the month of October, looks to be ending in a decidedly risk adverse tone as both the dollar and yen firmed into the weekend and next week’s FOMC main attraction. Asia saw mixed early data out of Japan, with Industrial Production the big disappointment at -1.9% versus the 0.5% expected. Although the poor results could be attributed to a firming yen, the Nikkei took a hit and the meltdown of risk was under way, sending the crosses into a tailspin. Full text »

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New York Session – October 28, 2010 4:15 PM

October 28, 2010

The dollar traded softer on renewed speculation that Fed action may weaken the greenback. As the ‘QE2’ debate continues, it is likely that markets may be range bound ahead of next week’s FOMC meeting. The only significant economic data out today was weekly jobless claims. Initial claims were a positive surprise with a drop last week to a 3-month low of 434K better than the expected 450K. The prior week’s claims were revised slightly higher to 455K from 452K. The 4-week moving average fell to the lowest level since July as with a decline to 453.3K from the previous 458.8K. EUR/USD climbed higher from session lows around 1.3770 to current levels around 1.3930. USD/JPY declined from highs of around 81.75 to current levels of about 81.00 as the dollar declined. Full text »

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U.S. Dollar Slips in Forex Trading

October 28, 2010

Gold prices, optimism pressure greenback in currency trading

The U.S. dollar, after enjoying a bit of a rally recently, is now slipping again in forex trading on the currency market. Today’s developments are pressuring the greenback a bit in currency trading. 

Gold prices are moving higher, and that is putting some pressure on the dollar, which often moves inversely to the precious metal. Additionally, there is some optimism about earnings today, and the direction of the global economic recovery. This sort of optimism precludes the need for the dollar as a safe haven.

Developments in Japan have had little effect on the U.S. dollar. Japan makes its moves to weaken the yen against the greenback, but so far efforts at quantitative easing in Japan have failed to produce the desired results of yen weakness.

The next big market mover for the U.S. dollar in forex trading is likely to be next week’s Fed announcement. More quantitative easing is expected, but there is uncertainty about how big the Fed’s efforts will be.

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Japanese Yen Moves a Little Higher, Even After BOJ Keeps Rates at 0%

October 28, 2010

Yen in forex trading

The Japanese yen continues to maintain much of its strength in forex trading on the currency market, even though the Bank of Japan kept rates practically at 0%.

The move by the BOJ was expected, though. Japanese monetary officials are trying to keep the yen weak — to no avail. The currency continues to gain ground against the U.S. dollar, whose recent rally has fallen off.

Efforts by the BOJ to continue with monetary easing are likely to go forward; the Japanese like a weak yen, since it helps their exports. Indeed, this recent trend of strength from the yen is actually hindering the economic recovery in Japan.

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London Session – October 28, 2010 7:29 AM

October 28, 2010

Dollar takes a breather: Full text »

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Asia Session – October 28, 2010 1:52 AM

October 28, 2010

The US Dollar couldn’t keep the three day trend going as it weakened today for the first time this week in Asia. Solid performance of equities helped to diminish the demand for the safe haven currency amidst a backdrop of dollar bears waiting for next week’s FOMC meeting to see what they have in store for QEII. It seems that yesterday’s newspaper reports of asset purchases to the tune of a “few hundred billion dollars” seem understated compared to estimates of up to $2 Trillion dollars worth of QEII from well respected global bank estimates, thus dampening yesterday’s dollar positive environment. Full text »

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