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EURUSD closed @ 12880 which was BELOW the open and was within prior day’s trading range. The High was 15 pips from Precise Trader’s Res Tgt 1 and the Low was 10 pips from Precise Trader’s Sup Tgt 2.   The Hourly Oscillators are Bearish but Weak and the Price is Within the MA, so CAUTIOUS  approach is needed for the Bears. Hourly Trend is Limited Down while 13025 holds and Daily Trend is Limited Up while 12645 holds, so expect the Price to have a Minimum Downside and the Bears have to be Cautious.  The Daily Trend breached the Prior  Day’s High  marginally but  the Bears  gained aggressively towards the Close . The  Hourly Trend  has been in a Range Trading with a Limited Downside Bias, 12915-13025 are the Critical  levels to watch to maintain the Bearish Outlook . On the 5 min is along the Horizontal Channel and the Patterns are suggesting Choppy Session until there is a Clear Break. The Opening Price Principles  are Mixed , so  Cautious approach is needed until the price breaks out of Zone 1 levels.

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By: Barbara Zigah

With currency investors trimming their long term holdings in the U.S. Dollar, the greenback slipped in Asian trading, closing in on the 2-month trough struck last week against the common currency Euro. As reported at 2:43 p.m. (JST) in Asia, the Euro traded at $1.2963, an increase of .15% and approaching the 2-month peak of $1.3008 struck last Friday. Disappointing economic data from the United States is triggering the exodus from the greenback which did manage to gain slightly versus the safe-haven Japanese Yen, but it nonetheless remains close to multi-month lows. The U.S. Dollar rose nearly .4% against the Japanese Yen, trading at 87.01 Yen, holding close to the 7-month low hit on the EBS trading platform last week when it struck 86.27 Yen. Some market players are keen to see what, if any, currency intervention the Japanese government may take should the Yen continue to climb.

Yesterday, housing data from the United States showed that new home sales lowered this month to a level not seen since April 2009; analysts attribute the expiration of the new home buyers’ tax credit for the reduction. This weak data has put on hold speculation that the Federal Reserve might consider a hike in interest rates sometime in the near future, and analysts suggest that Ben Bernanke’s testimony to the U.S. Congress

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At the June G-20 summit in Toronto, it was decided that countries would pursue necessary budget cuts to reduce sovereign debt.  The U.S. insisted that the member nations continue to pursue growth as part of a successful formula to end the recession.  The growth-trim controversy was the key discussion at the Toronto summit.

While the participants agreed to the concept, they returned home to unleash austerity cuts with little concern for growth.  The avoidance of a strategy to grow alongside the debt reduction has spread beyond the euro zone as Britain, Brazil and India have joined the parade.

On Tuesday, China expressed concern that the euro zone cuts would greatly affect the country’s export balance.  The U.S. has expressed the same concern ever since Greece needed assistance to meet its obligations.

In Monday’s after trade quarterly reports, IBM and Texas Instruments announced lower than expected results.  The surprise announcements sent tremors thought European markers and sent the Nikkei to a 1.2 percent loss as European equities fell for a fifth straight day.

Earlier in the day, the euro had crossed the $1.30 mark and was holding at $1.3029.  Nervous investors seemed to doubt the currency’s ability to handle the results of the stress tests to be revealed on Friday.  The euro was trading at $1.2851 when U.S. markets open

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In less than three months, and not even counting the past few days, the Dow has had six big swings averaging more than 1,000 points each — one of them occurred in a single day.

Altogether, like a cross-country caravan, the Dow traversed more than 7,000 points within a 1,600-point range. And you thought the ocean was choppy!

In trademark fashion, the media blamed the bad days on everything from the Gulf oil spill to Greek debt to a “fat-finger” trader glitch to a double-dip recession to lackluster earnings. And they credited the good days to the same list of items “not looking as bad”!

On the other hand, a small group of investors were prepared for this very environment. They positioned themselves for safety and insulated themselves from risk.

You can now get up to speed with this group of independent-minded investors — for free — by reading the same unique brand of analysis they’re reading: Robert Prechter’s Elliott Wave Theorist.

Prechter’s firm, Elliott Wave International, has put together a short — albeit very powerful — summary of his latest market analysis and forecasts. If you’re looki

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Seven weeks ago, the euro was staggering.  After creating a $100 billion safety fund, the euro zone has implemented a series of austerity cuts while countries that seemed pitted against each other have pulled together in a common cause to save their troubled currency. 

The originally divisive financial plan, which includes stress testing of the zone’s 100 largest banks, has buoyed the euro.  In overnight trading, the euro reached a two-month high at $1.2970 and seems certain to cross the $1.30 threshold soon. 

On June 7^th, the euro had fallen to $1.1875.  Based upon strong showings at debt auctions in Greece, Portugal and Spain, the euro has stabilized and has moved ahead.  Greece, Spain and Portugal have suffered credit rating reductions by all major credit agencies. 

The European Central Bank’s strong cash position has eased intra-bank trading.  The euro has gained 9 percent since early June and unless the Federal Reserve raises its rates, the dollar may continue to slide against other currencies.  Thus far, the Federal Reserve has hesitated to raise rates because another round of quantitative easing may well be in the offing.

On July 1^st, the dollar fell to 89.96 yen, the lowest rate since December.  The dollar’s 14-year low against the yen is 84.82, struck in November 2009.  After that fall, the Bank of Japan invested 10 trillion yen in the dollar.  Analysts had projected a 90.18 dollar/yen gain by March 2011.

Euro Zone Progress

Following a solid Spanish bond auction, successfully renegotiated wages in Greece and a vote of confidence in Italy, French Prime Minister Francois Fillion addressed the media on Friday.  The Prime Minister stressed that recent weakness in the euro was the result of poor national fiscal policies and not weakness in the euro currency system.

The prime minister allayed fears by asserting that the euro was on the mend.  Fillion pushed Japan to maintain faith in the currency.

“Greece has endangered the credibility of its budgets, but public finances in the EU are no worse than the situation in the U.S/ and Japan,” said Fillion.

In early Friday trading, the dollar continued its 1 percent slide against the euro, the yen and sterling.  Poor economic news and political infighting have caused weakening of the dollar.

A report showing that producer prices fell for the third successive month was released on Thursday.  On top of the Empire State Survey, conducted by the New York Federal Reserve, which shows that New York’s production fell to its lowest rates since December, and a similar report in Pennsylvania, projections for growth have been trimmed.

Goldman Sachs released projections that the euro would rise to $1.35 in the next six to 12 months.  As bond auctions in the U.S. continue weak performances,

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Another day and another impressive session for the currency markets, with the Euro once again leading the way to close back above the 100-Day SMA for the first time since December of 2009.

 MORNING SLICES

FUNDYS
 
The Greenback has fallen way out of favor of late and we have been hearing that the latest price action has been attributed to longer-term accounts booking profit on long USD positions, and model funds establishing fresh Euro longs.
 
Relative Performance Versus USD on Thursday (As of 9:00GMT) –

1) YEN        +0.38%
2) EURO -0.01%
3) SWISSIE         -0.16%
4) STERLING -0.26%
5) CAD         -0.53%
6) AUSSIE -0.90%
7) KIWI -1.90%
 
Fundamentally, the cooling off of sovereign debt concerns in Europe has also played a large role in the Euro’s rebound, while a downbeat Fed, weaker empire state manufacturing, disappointing Philly Fed, and softer headline PPI have all take away from any appeal the USD might have. It appears that so long as the Read more…

The U.K. pound is rallying today in forex trading on the currency market. An improving picture in the British economy is helping give the sterling a boost in currency trading.

Britain saw a lower claimant count than expected, indicating that the jobs situation could be improving. Indeed, employment for the three months leading up through May saw a good pace.

GFT’s Boris Schlossberg reports in FX360 on the possibilities for the sterling in currency trading:

While we believe any expectations of monetary tightening by the BOE are much too premature, today’s positive labor market results should prove constructive to sterling longs and the pair will likely target 1.5300 later in the day if risk appetite remains supportive into the North American session.

The euro is not seeing the same success today, though, as it struggles against the return of some risk aversion to the currency market.

By: Barbara Zigah

A weakened equity market in Tokyo helped to push the common currency Euro and the U.S. Dollar down versus the safe-haven Japanese Yen. Early on in the Asian trading session, investors with a long-term outlook and pension fund operators from Japan bought into the Euro and greenback on speculation that overseas currencies would offer a better return than the safe-haven Yen, but choppy trading caused investors to reverse direction and buy back their Yen. As a result, at 2:30 p.m. (JST) in Tokyo, the U.S. Dollar was trading against the Japanese Yen at 88.53 Yen, compared to an earlier higher trade of 88.87 Yen. It was the same story against the Euro, with the Yen slipping to 111.50 Yen from the earlier high of 112.07 Yen.

Some investors see the U.S. Dollar falling against the safe-haven Japanese currency later today, perhaps even to 88.20 Yen, dependent upon the release of key economic data from the U.S. and the Euro-zone. Corporate earnings from U.S. com

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In the broadcast today: Is the GBP Ready for Further Gains vs. USD & EUR? In light of the renewed strength of the British Pound, we explore the potential for further gains of the GBP against the USD and the EUR, we analyze the latest trend developments with the GBP/USD and EUR\/GBP currency pairs, we continue to monitor the bullish breakout in the EUR/USD pair, we follow up on the anticipated strengthening of the commodity currencies: CAD, AUD and NZD, we highlight the market’s reaction to the Australian Consumer Confidence, the New Zealand Retail Sales, the U.K. Jobless Claims, the Euro-zone HICP and Industrial Production, and the U.S. Retail Sales, we discuss new forecasts from Royal Bank of Scotland and UBS, and prepare for the trading session ahead.

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In the broadcast today: USD and EUR New Trading Week Outlook. As the markets fluctuate in anticipation of the start of earnings season, we list the Top 10 economic events that will drive the trends for the major currencies in the week ahead and explore what next week may have in store for the USD, EUR and other currency majors, we analyze the latest trend developments with the EUR/USD and USD\/JPY currency pairs, we follow up on the anticipated strengthening of the CAD as a result of the better-than-expected jobs creation in Canada, we continue to monitor the weakening of the GBP vs. USD and EUR, we examine some of the consensus forecasts for the upcoming economic data, we highlight the market’s reaction to the U.K. Producers Price Index and the Canadian Employment Situation report, we discuss new forecasts from Bank of New York-Mellon and Credit Suisse, and prepare for the busy trading week ahead.

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