1. This site uses cookies. By continuing to use this site, you are agreeing to our use of cookies. Learn More.

Forexpros.com Daily Analysis - 19/11/2008

Discussion in 'Fundamental Analysis' started by ForexAnalysis, Nov 19, 2008.

  1. ForexAnalysis

    ForexAnalysis Contributing Member

    Joined:
    Apr 13, 2008
    Messages:
    234
    Likes Received:
    0
    Free Webinar

    Control your Forex trading Risk...or Fail
    Stop trading now if you do not know your initial risk of loss compared with your potential reward AND how much to risk before EVERY forex trade.

    Tony Beckwith of the specialist risk control software firm MTPredictor Ltd. explains why you MUST follow the 4 Stage Process of trading with discipline and control to be profitable over the long run.
    Thursday Nov, 20th

    Click here to sign up!


    Forex Analysis - Daily


    Today’s US Dollar Trading

    • Two-way action due to equities
    • Traders note USD feels neutral
    • EURO makes lows late


    Overnight Preview

    • Look for more USD upside to start overnight
    • Two-way action likely to continue into US tomorrow


    Looking Ahead to Wednesday
    All times EASTERN (-5 GMT)
    • 8:30am USD Building Permits
    • 8:30am USD Core CPI m/m
    • 8:30am USD CPI m/m
    • 8:30am USD Housing Starts
    • 9:00am USD FOMC Member Kohn Speaks
    • 10:35am USD Crude Oil Inventories
    • 2:00pm USD FOMC Meeting Minutes


    Summary
    The USD continued in solid two-way trade today after earlier gains gave way to losses mid-day and then reversed yet again to finish better on the day against most pairs. Traders blame volatility in equities today for the whipsaw across the board as Wall Street was unable to hold gains into the end of the day. GBP rallied overnight into high prints at 1.5094 but those highs remained unchallenged in New York trade as sellers offered the rate lower more than a full handle to finish at the 1.4920 area; traders note pressure from EURO losses late in the day suggesting that the near-term lows still are under threat for additional attempts for new 2008 lows. EURO tracked equities for most of the day rallying to new US highs mid-day at 1.2701 before reversing to make new lows on the day at 1.2566 making for a slight reversal on the charts; traders in both pairs note that the same buyers seen the past few sessions were back on the dips but unable to hold gains suggests that stops will build overnight under current lows. USD/JPY had high prints on equities strength at 97.42 before reversing with stocks for a test of the lows at 96.01 but unable to trigger stops said to be resting in that area; the rate holding at 96.50 into the end of day. USD/CHF rallied in thin volume to find stops above the 1.2024 area for a new two-year high at 1.2049 and ends firm above the 1.2000 area at 1.2030; traders note that technical buying appears to be holding the rate firm as reversal signals evaporate in late trade. Weaker commodities pricing also cited for the better USD although usually that would be bearish in the rate making for difficult trade. Today’s US data was considered neutral for the Greenback and traders note that despite the volatility and two-way action today the USD feels neutral on the day suggesting that more two-way action is likely overnight. In my view, despite the late rally in the USD , the recent ranges are holding with the exception of Swissy suggesting that the majors will continue to sketch out wide trading ranges as we head into the end of the week and possibly the month. With a short week next week for the US Thanksgiving holiday expect book-squaring and liquidation of positions as traders finish the last full week of the month by Friday. Overnight the Yen crosses likely will remain in focus as lower equities have prompted Yen selling so expect more losses for the majors as they rotate back to the lows ahead of US trade.


    GBP/USD Daily

    Resistance 3: 1.5200/10
    Resistance 2: 1.5150
    Resistance 1: 1.5080
    Latest New York: 1.4926
    Support 1: 1.4650
    Support 2: 1.4580
    Support 3: 1.4480/1/4500


    Comments
    Overhead resistance around 1.5100 holds on first try today, tracking EURO and equities for the most part. Traders note stops above the 1.5100 handle likely building near-term. Resistance is expected to hold rate for a pullback and aggressive traders can buy that dip if it comes. Cross spreaders continue to hold interest near-term; profit-taking likely to result in a squeeze on the further strength. Thin conditions continue to exacerbate moves. Some stops noted on the break back over the 1.4850, 1.5000, and 1.5050 areas yesterday; the rate continues two-way on the move. Technical trade overnight as traders decide near-term action with little to go on but the charts. BOE rate cut next month increasingly likely but that is likely completely factored in at this point. Traders note liquidity is only moderate and still on the lower side. Aggressive traders can look to buy the next dip.
    Data due Wednesday: All times EASTERN (-5 GMT)
    4:30am GBP MPC Meeting Minutes
    6:00am GBP CBI Industrial Order Expectations
    1:40pm GBP MPC Member Gieve Speaks


    EURO/USD Daily

    Resistance 3: 1.2850
    Resistance 2: 1.2800
    Resistance 1: 1.2750
    Latest New York: 1.2621
    Support 1: 1.2520/1.2500
    Support 2: 1.2450/60
    Support 3: 1.2400


    Comments
    Rate reverses after highs at 1.2700 area attract profit-taking by the longs and selling by the shorts; rate dips to lows into the 1.2500 handle and a drop to support likely overnight. Two-way action still suggesting a point on indecision; traders note stops building above the market around the 1.2750 area or so suggesting short-term traders active. New weekly low rejected fairly hard suggesting a re-test is a solid buy if not already long on the dip. Traders report some semi-official interest the past 48 hours. Resistance is still formidable but large names on the dips traders say. On a rally, traders note large stops at the 1.2950 area with more over 1.3000 but offers likely to cap. Support also from cross-spreaders as they unwind Yen. Official interest noted traders say. Rate is an absolute screaming buy in my view—I can’t see further weakness being ignored by the buyers. Traders note the rate is finding profit-taking bids on dips so far despite the uncertainty in the market.
    Data due Wednesday: All times EASTERN (-5 GMT)
    NONE

    Join us for the Afternoon US Dollar Wrap-Up daily at 3:15 pm Central/Chicago time (GMT -6)

    Analysis Provided by: Forexpros - Written by Jason Alan Jankovsky


    DISCLAIMER:
    Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.
     
    #1 ForexAnalysis, Nov 19, 2008
    Last edited: Nov 19, 2008
Loading...

Share This Page