http://www.traderslaboratory.com/forums/blogs/ Traders Laboratory (TL) is the leading online trading forum for day traders, swing traders, and active investors covering forex, stocks, futures, and options. en Fri, 03 Sep 2010 08:48:56 GMT vBulletin 30 http://traderslaboratory.com/forums/images/trad_lab/misc/rss.jpg http://www.traderslaboratory.com/forums/blogs/ http://www.traderslaboratory.com/forums/blogs/jehs/1110-another-day.html Thu, 02 Sep 2010 22:28:39 GMT I haven't had time to trade lately at all, but today I managed to fit a coupe in...

http://mydaytradingcharts.blogspot.c...2_archive.html ]]> JEHs http://www.traderslaboratory.com/forums/blogs/jehs/1110-another-day.html http://www.traderslaboratory.com/forums/blogs/fastbrokers/1109-s-p-futures-calm-following-surge.html Thu, 02 Sep 2010 20:19:16 GMT The S&P futures surged higher yesterday, posting a remarkable defense of our previously highlighted key long-term uptrend line and the psychological 1050 level. Buying in the S&P futures returned with avengeance after U.S. manufacturing PMI data came in at 56.3, topping analyst expectations of 53.2. Considering investors have only been receiving negative U.S. data recently, the encouraging PMI reading gave bulls ammo to take advantage of oversold conditions. Wednesday’s impressive rally has saved the S&P’s long-term uptrend for the time being after flirting with the concept of entering a more lasting contraction. The most encouraging part of yesterday’s manufacturing PMI reading is that the reading had been on a steady downtrend.

The reversal sets up the possibility of only a large step down in the U.S. economy and not a double dip. Analysts flooded the wires with estimates ranging from 25-33% chance of a double dip, meaning odds are the U.S. economy will continue to stabilize over the medium-term. The sudden shift in sentiment clearly had an immediate impact and we’ll have to see whether equities can post a confirmation rally before week’s end. Markets will have more than enough ammo to make game-changing movements with pending home sales on tap and headline employment data highlighting on Friday. Should employment data happen to surprise to the upside then there would likely be another large rally in equities and the S&P futures could have enough energy to drive past their highly psychological 1100 level. However, unemployment claims are still historically high and yesterday’s ADP figure was nothing to cheer about. Hence, should tomorrow’s employment data disappoint then sentiment could turn sour once again.

The ECB will also make its monthly monetary policy decision today, meaning investors will have a hefty amount of psychological and fundamental developments to digest over the next 24-48 hours. That being said, we expect an active end to the trading week.



Disclaimer: FastBrokers' market commentary is provided for information purposes only and under no circumstances should be regarded neither as investment advice nor as a solicitation or an offer to sell/buy any financial product. FastBrokers assumes no responsibility or liability from gains or losses incurred by the information herein contained. All materials are property of Fast Trading services, LLC and unless otherwise indicated, any unauthorized reproduction is prohibited. ]]> fastbrokers http://www.traderslaboratory.com/forums/blogs/fastbrokers/1109-s-p-futures-calm-following-surge.html http://www.traderslaboratory.com/forums/blogs/dailyfx/1108-u-s-dollar-continues-lose-ground.html Thu, 02 Sep 2010 12:59:52 GMT Euro showed little reaction to the European Central Bank interest rate decision as policy makers held the benchmark interest rate at 1.00% in... Euro showed little reaction to the European Central Bank interest rate decision as policy makers held the benchmark interest rate at 1.00% in September, but the slew of data scheduled for the U.S. trade is likely to stoke increased volatility in the exchange rate as investors weigh the outlook for future growth.

Talking Points

* Japanese Yen: Gains Ground Against Most Counterparts
* Pound: Manufacturing Expands at Slower Pace
* Euro: 2Q Growth Rate Expands 1.0%
* U.S. Dollar: Pending Home Sales, Factory Orders on Tap

At the same time, ECB President Jean-Claude Trichet will be holding a press conference at 12:30 GMT regarding the decision made by the Governing Council, and the central bank head is likely to talk down the risks for the region as he expects to see a moderate recovery going forward.

Nevertheless, the preliminary 2Q GDP reading for the Euro-Zone showed economic activity expanded 1.0%, which was in-line with expectations, while the annualized rate increased 1.9% from the previous year amid an initial forecast for a 1.7% rise in the growth rate. The breakdown of the report showed household consumption increased 0.5% to top projections for a 0.2% rise, with government spending increasing 0.5%, while gross fixed capital formations advanced 1.8% from the first three-months of the year. At the same time, a separate report showed producer prices in the region increased at an annualized pace of 4.0% in July to mark the fastest pace of expansion since October 2008, and the data reinforces an improved outlook for growth and inflation as the recovery gathers pace. As a result, the ECB may look to revise its economic assessment and drop its dovish outlook for future policy as it maintains its one and only mandate to ensure price stability, and the Governing Council may see scope to reestablish its exit strategy going into 2011 as growth prospects improve.

The British Pound pared the previous day’s advance and slipped to a low of 1.5372 as the economic docket reinforced a weakened outlook for the region, and the GBP/USD may continue to trend lower over the near-term as it maintains the downward trending channel from the August high (1.5997). Meanwhile, the International Monetary Fund warned that the U.K. will need long-term reforms to manage its public finances as the group sees the region’s debt-to-GDP ratio more than doubling by 2015 from 44.1% in 2007, but went onto say that “current market indicators of default risk seem to reflect some market overreaction” as the government takes unprecedented steps to lower the budget deficit. At the same time, the economic docket showed home prices in the region fell more than expected in August as the Nationwide index tumbled 0.9% amid forecasts for a 0.3% decline, while prices increased 3.9% from the previous year, which marked the slowest pace of growth since November. As policy makers withdraw fiscal support despite the ongoing weakness in the real economy, the Bank of England is likely to maintain the expansion in monetary policy as it aims to encourage a sustainable recovery, and the central bank may hold a wait-and-see approach over the coming months as it aims to balance the risks for the region.

The greenback continue to lose ground against most of its major counterparts, with the USD/JPY retracing the previous day’s advance to reach a low of 83.99, and the dollar could face increased selling pressures throughout the day as the economic docket is expected to reinforce a weakened outlook for future growth. Pending home sales in the world’s largest economy is forecasted to fall 1.0% in July after contracting 2.6% in the previous month, while final 2Q reading for nonfarm productivity is projected to show a 1.9% decline amid an initial forecasts for a 0.9% drop. At the same time, factory orders are anticipated to rise 0.2% in July after falling 1.2% in the previous month, but the majors may hold its current range ahead of Friday’s Non-Farm Payrolls release as market participants forecast the U.S. economy to shed another 100K jobs in August. ]]> DailyFX http://www.traderslaboratory.com/forums/blogs/dailyfx/1108-u-s-dollar-continues-lose-ground.html http://www.traderslaboratory.com/forums/blogs/dailyfx/1107-australian-dollar-soars-q2-gdp-chinese.html Wed, 01 Sep 2010 13:30:34 GMT *Australian Dollar Soars as Q2 GDP, Chinese PMI Top Expectations* The Australian Dollar surged against all of its major counterparts after... Australian Dollar Soars as Q2 GDP, Chinese PMI Top Expectations

The Australian Dollar surged against all of its major counterparts after second-quarter Gross Domestic Product figures showed the economy added 1.2 percent in the three months through June, topping economists’ forecasts calling for a 0.9 percent increase and marking the largest increase in three years.

The currency was already on its way higher ahead of the GDP report after Chinese Manufacturing PMI figures showed growth in the East Asian giant’s industrial sector accelerated for the first time in three months in August. The outcome was interpreted as supportive for Australia via export demand considering China is the world’s largest consumer of the antipodean nation’s mining goods as well as for overall risk appetite given China’s central role as a driver of global growth in the aftermath of the 2008 Great Recession.

Australian Dollar Trade-Weighted Index Spot (1min chart)


Looking ahead however, overnight gains don’t seem to have much scope for longer-term follow-through. Indeed, the Chinese PMI gauge remains in a downtrend in place since the metric topped out in December 2009, with today’s result coming nowhere near violating that trajectory. Furthermore, the Australian GDP result has done nothing for RBA rate hike expectations, with a Credit Suisse index tracking priced-in policy changes still pointing to toward a static posture for the year ahead. Meanwhile, signs of a broad-based slowdown in global growth abound, with JPMorgan’s Global PMI down to a 5-month low in July while the Baltic Dry Index – a gauge of international trade activity – slid to the lowest since April 2009 over the same period. On balance, this hints that the path of least resistance points toward continued risk aversion, an outcome that bodes ill for the carry-linked Australian Dollar. We remain short AUDUSD. ]]> DailyFX http://www.traderslaboratory.com/forums/blogs/dailyfx/1107-australian-dollar-soars-q2-gdp-chinese.html http://www.traderslaboratory.com/forums/blogs/dailyfx/1105-weekly-trading-forecast-08-30-10.html Mon, 30 Aug 2010 12:54:24 GMT US Dollar Direction Could Be Decided on Nonfarm Payrolls Report...
US Dollar Direction Could Be Decided on Nonfarm Payrolls Report

Euro’s Attempt at a Recovery Rides on the Dollar, Investor Confidence

Japanese Yen at the Crossroads as the BoJ Discusses Intervention

British Pound Looks To Manufacturing Data For Support

Canadian Dollar Has Little to Look Forward to in GDP Release

Australian Dollar Outlook Weighed By Interest Rate Expectations

New Zealand Dollar at Clear Risk Ahead of US Labor Data

Gold May Extend Slow Ascent as Market Uncertainty Prevails

]]> DailyFX http://www.traderslaboratory.com/forums/blogs/dailyfx/1105-weekly-trading-forecast-08-30-10.html http://www.traderslaboratory.com/forums/blogs/jehs/1104-whatever.html Fri, 27 Aug 2010 21:41:14 GMT After all these years and I still apparently don't have a freaking clue what I am doing...

http://mydaytradingcharts.blogspot.c...day-today.html ]]> JEHs http://www.traderslaboratory.com/forums/blogs/jehs/1104-whatever.html http://www.traderslaboratory.com/forums/blogs/dailyfx/1103-month-end-flows-official-speak-encourages.html Fri, 27 Aug 2010 13:12:39 GMT Things could certainly heat up in the final sessions of trade for the week, with the market having consolidated over the past few days and now... Things could certainly heat up in the final sessions of trade for the week, with the market having consolidated over the past few days and now seemingly ready for some form of a breakout on the last trading day of the month.

FUNDYS

Things could certainly heat up in the final sessions of trade for the week, with the market having consolidated over the past few days and now seemingly ready for some form of a breakout on the last trading day of the month. The summer is nearly gone and traders are starting to filter back to their desks. Month end flows ahead of September therefore could take on a new meaning, as market participants gear up for the final stretch of 2010. For the time being however, there are two pressing issues that are waiting for more clarity in Friday trade that could ultimately dictate broader direction in the markets over the coming days. The first is the issue of the Yen, and what exactly if any measures will be taken by Japanese officials to counter the recent strength. The second is what type of outlook Fed Chair Bernanke will give at today’s highly anticipated symposium in Jackson Hole Wyoming.

Relative Performance Versus USD Friday (As of 7:20GMT)

1. KIWI+0.26%
2. AUSSIE+0.16%
3. EURO+0.09%
4. STERLING-0.01%
5. SWISSIE-0.03%
6. CAD-0.07%
7. YEN-0.25%

The announcement from PM Kan that he will be holding a press conference later today, specifically on the topic of fighting Yen strength has been enough to spark some form of Yen selling, and this selling could accelerate on any news of official measures to counteract the Yen appreciation. Japanese FinMin Noda has also reiterated Japan’s resolve to act on FX as needed. In our opinion, the Yen is at a high risk for some form of a material sell-off over the medium-term and although there has been no direct catalyst as of yet, it seems like we are inching closer to one. Technical studies also confirm a Yen bearish bias, with the single currency at multi-year highs against the USD and Euro.

The other hot topic of the day is the upcoming Jackson Hole symposium in which Fed Chair Bernanke will provide some added insights into the direction of monetary policy which should be quite interesting in light of the latest slowdown in the US economy following a slew of softer economic data. Bernanke’s remarks could have a major influence on the direction of the buck, but at this point it is unclear which direction the USD will head. Should the Fed Chair announce that the central bank now has a clear plan on how to counteract the latest slowdown through the implementation of new policies, we are likely to see a sell-off in the USD and rally in equities as market participants feel comforted by the Fed’s actions and look to buy back into risk. However, should the Fed Chair announce that the Fed will increase policy as needed and remain in a wait and see mode, the reaction is likely to be net USD bullish and equity negative as market participants grow increasingly concerned that not enough is being done to counteract the slowdown, resulting in some flight to safety trade.

There is one other possibility, and that is that Bernanke balances his statement and says that the Fed is in a wait and see right now but also concedes that things have been weaker than they had thought, and as such, the Fed is prepared to act if things persist. The market reaction in this scenario is likely to be net USD and equity neutral.

There are some major data releases out of the UK and US today that would otherwise dominate trade, but at present are taking a backseat to the broader global macro developments. UK GDP has already been released and was slightly better than forecast, while US GDP (1.4% expected) is due at 12:30GMT. Other noteworthy data includes University of Michigan confidence (70.0 expected) at 13:55GMT.

GRAPHIC REWIND



TECHS

EUR/USD: (See below).
USD/JPY: The market has not been able to hold onto to its fresh multi-year lows set in Tuesday trade below 84.00, with the price rallying since and threatening a break back above initial resistance by the 10-Day SMA just over 85.00. However, while the market trades below the 20-Day SMAs on a close basis, the downtrend remains intact and deeper setbacks below 83.60 can not be ruled out. A close above the 20-Day SMA will be required at a minimum to offer some form of relief to downside pressures. The market has not closed above the 20-Day SMA since mid-June when the pair was trading over 90.00.

GBP/USD: Although the inter-day structure looks quite bearish at present following the latest break below 1.5500, there is a shorter-term risk for additional upside to allow for recently oversold technical studies to unwind. However, we expect any rallies to be well capped ahead of 1.5700 in favor of the next downside extension towards the 100-Day SMA by 1.5100. Setbacks have been supported for now by the 50-Day SMA. Ultimately, only a break back above 1.5700 would negate outlook and give reason for pause. Back under 1.5370 accelerates declines.

USD/CHF: Has managed to break to yet another multi-week low below 1.0300 to open a fresh downside extension towards the yearly lows from January by 1.0130 over the coming sessions. However, any additional declines below 1.0130 are seen limited, with medium-term studies looking stretched. As such, we would be more inclined to be looking for opportunities to buy at current levels. For now, a break and close back above 1.0320 will be required to relieve immediate downside pressures.

FLOWS

Japanese exporter offers; importer bids in Usd/Jpy. Stops cited above 108.05 in Eur/Jpy. Eur/Usd well offered ahead of 1.2800. Corporate bids in Usd/Cad. End of month flow demand for Aussie and Kiwi. Some buy-side interest in Eur/Chf by 1.3000.

TRADE OF THE DAY



Eur/Usd: The market seems to have found some form of a base for now by 1.2585 ahead of the latest bounce and while the overriding structure remains bearish, shorter-term technical studies do not rule out the possibility of additional upside before we see a bearish resumption below 1.2585. Given end of month flows and some fundamental risk, volatility could be running quite high for the remainder of the day and this could result in a meaningful intraday rally for the pair. At the moment, our daily ATR analysis projects a potential high on Friday in the 1.2820 area, while the 78.6% fib retracement off of the latest 1.2920-1.2585 move comes in slightly higher by 1.2850. As such, we will look to take advantage of any intraday rallies towards these levels, with the market still confined to a broader downtrend. STRATEGY: SELL @1.2845 FOR AN OPEN OBJECTIVE; STOP 1.2945. RECOMMENDATION TO BE REMOVED IF NOT TRIGGERED BY NY CLOSE ON FRIDAY. ]]> DailyFX http://www.traderslaboratory.com/forums/blogs/dailyfx/1103-month-end-flows-official-speak-encourages.html http://www.traderslaboratory.com/forums/blogs/jehs/1102-8-26-2010.html Thu, 26 Aug 2010 22:36:56 GMT http://mydaytradingcharts.blogspot.com/2010/08/good-trade.html http://mydaytradingcharts.blogspot.c...ood-trade.html ]]> JEHs http://www.traderslaboratory.com/forums/blogs/jehs/1102-8-26-2010.html http://www.traderslaboratory.com/forums/blogs/dailyfx/1101-rebound-risk-sentiment-weighs-u-s.html Thu, 26 Aug 2010 13:32:00 GMT A rebound in risk sentiment pushed the euro higher for the second day, with the exchange rate advancing to a high of 1.2745 during the overnight... A rebound in risk sentiment pushed the euro higher for the second day, with the exchange rate advancing to a high of 1.2745 during the overnight trade, but the lack of momentum to retrace the decline from the previous week is likely to keep the EUR/USD within a narrow range throughout the day as price action continues to hold below the 50-Day SMA at 1.2757.

Talking Points

* Japanese Yen: Weakens Against Most of the Majors
* Pound: Retail Spending Improves
* Euro: Ireland’s Borrowing Costs Fall Despite S&P Downgrade
* U.S. Dollar: Jobless Claims, Mortgage Delinquencies on Tap

Meanwhile, Ireland’s National Treasury Management Agency sold EUR 200M of debt due on February 14, 2001, with an average yield of 1.978%, which is 48bp lower than the rate offered at the August 12th auction, along with another EUR 400M bonds due on April 18, 2011, yielding 2.348%.

The bond auction suggests investors are turning increasingly optimistic towards the region as the government takes unprecedented steps to manage its public finances, but the ongoing weakness in the banking system may continue to drag on the economic outlook as policy makers expect to see an “uneven” recovery going forward. As a result, the European Central Bank is likely to maintain a dovish tone over the coming months and is widely expected to keep the benchmark interest rate at 1.00% over the coming months as President Jean-Claude Trichet sees subdued price growth over the near-term, but the Governing Council may see scope to raise its growth forecast as the recovery gathers pace. Nevertheless, the economic docket the M3 money supply grew 0.1% during the three-months through July, which was largely in-line with expectations, while the annualized rate increased 0.2% from the previous year amid forecasts for a 0.3% expansion.

The British Pound rallied for the second-day and pushed above the 200-Day SMA (1.5462) to reach a high of 1.5588, and the GBP/USD may continue to pare the decline from the previous week as it remains supported by the 50-Day SMA at 1.5380. Meanwhile, a report by the Confederation of British Industry showed its retail spending in the U.K. unexpectedly expanded at a faster pace in August, with its gauge for sales advancing to 35 from 33 in the previous month, and the data encourages an improved outlook for the region as private sector spending remains one of the leading drivers of growth. As the recovery gathers pace, the Bank of England may drop its dovish tone and see scope to start normalizing monetary policy towards the end of the year, and we are likely to see board member Andrew Sentance continue to push for a 25bp rate hike as the central bank expects inflation to hold above the 2% in 2011.

The greenback weakened across the board on Thursday, with the USD/JPY paring the overnight advance to reach a low of 84.47, and the rebound in market sentiment may continue to weigh on the dollar throughout the day as risk trends dictate price action in the currency market. Nevertheless, the economic docket is expected to show initial jobless claims slip to 490K in the week ending August 21 from 500K in the week prior, while continuing claims is forecasted to increase to 4495K in the week ending August 14 from 4478K in the previous month. At the same time, the gauge for 2Q mortgage delinquencies is scheduled to cross the wires at 14:00 GMT, along with the MBA’s index of mortgage foreclosures, and the event risks scheduled for later today could stoke increased volatility in the foreign exchange market as investors weigh the outlook for future growth. ]]> DailyFX http://www.traderslaboratory.com/forums/blogs/dailyfx/1101-rebound-risk-sentiment-weighs-u-s.html http://www.traderslaboratory.com/forums/blogs/dailyfx/1100-germany-confirms-breathtaking-growth-can-maintained.html Tue, 24 Aug 2010 13:14:13 GMT Second quarter growth in Germany was confirmed at 2.2% this morning as exports and investment fueled Germany’s record breaking economic growth. A... Second quarter growth in Germany was confirmed at 2.2% this morning as exports and investment fueled Germany’s record breaking economic growth.

A breakdown of the data showed that exports rose 8.2% from the first quarter, however this record growth may be hard to maintain when so reliant on exports as slowdowns in China and US economies are likely to weigh on demand for foreign products.

Growth should remain strong in the second half of 2010 but we are unlikely to see a similar pace as dark clouds gather on the horizon. Also worthy of note was the weaker than expected domestic demand release, indicating that Germany cannot rely on its own people to continue to buy its products as they continue to be uber-conservative and save greater portions of their income. While private consumption in the second quarter reported its first gain since Q2 2009, we believe that domestic demand still remains tepid and needs to be boosted over the medium-term. As such Germany leaves itself vulnerable to global fluctuations rather than having solid domestic demand which can help the economy weather volatile periods in the global economy.

Still, the central bank last week raised its growth forecast for Germany this year from 1.9% to 3% calling growth in the second quarter “extraordinarily dynamic”. Bundesbank President Weber also added that “an upward revision of the forecast of 2011 is not excluded”.

On balance Germany’s second quarter growth is very impressive and should propel EMU figures for the period higher and we expect Germany to continue to grow throughout the rest of the year, albeit at a slower pace. Our concerns are based on possible double-dip scenarios in the US and further slowing in Chinese growth which could seriously affect German exports, and growth. Other concerns for German growth come closer to home; the EMU, Germany’s biggest trade partner, has many countries who are slashing budgets to tackle deficits and are likely to trim their demand for German produced goods which is likely to affect German growth in H2 2010. ]]> DailyFX http://www.traderslaboratory.com/forums/blogs/dailyfx/1100-germany-confirms-breathtaking-growth-can-maintained.html