Forex Technical And Fundamental Analysis For November 21, 2011

EUR/USD Technical Analysis for November 21, 2011

EUR/USDrose during the session on Friday as the pair continues to fight tooth and nail at the 1.35 mark. The resulting candle is a shooting star, so it does show just how much trouble the bulls are having at this point in time. With bond auctions going poorly in several European countries at the moment, this pair should remain under considerable pressure. However, the area just below has a ton of support, and we think any fall will more than likely be a slow grind. We do not buy the Euro rather sell rallies at this point as it is too toxic to keep on the books for any length of time.

EUR/USD Fundamental Analysis for November 21, 2011

The EUR/USD is about to start a new hectic week with the debt crisis still centre stage. Political developments will be a major focus and more auctions will add to the debt market strain as investors await the next action from European leadership. On Monday the market will open to reaction on the new government formed inSpainas they hold the General Election on Sunday November 20 and by the time the market opens the new face of the government will show. Expectations are for the opposition People’s Party to overtake majority and end the Socialist government’s rule, the market might still find support in the news as they also support further adjustment and austerity to bring the deficit down to 4.4% by next year! We still see the week focused on the euro area with the debate how to contain the crisis, especially as now the option of the ECB lending the IMF to lend troubled states reemerging and to see if there is more talk of it which might support the sentiment that some progress is being made. The euro zone will start this week at 09:00 GMT with the current account figures for September, where the previous non-seasonally adjusted deficit was 6.3 billion euros, while the previous seasonally adjusted deficit was 5.0 billion euros. TheUnited Stateswill join the session at 15:00 GMT with the existing home sales figures for October, with expectations that the existing homes sales could have retreated to 4.80 million houses from 4.91 millions. In addition, the monthly existing home sales index could show that sales dropped by 2.2% from the previous drop of 3.0%.

USD/JPY Technical Analysis for November 21, 2011

USD/JPY fell during the Friday session, but managed a bounce to form a hammer at support. The pair looks like it is ready to bounce a bit, but buying isn’t advised. The pair is decidedly bearish, and any rally that could come of this candle will more than likely be looked at as a chance to sell again by the trading community. Because of this, we are waiting for a bounce – and then selling.

USD/JPY Fundamental Analysis for November 21, 2011

The USD/JPY pair ended last week with more losses which increase pressure on the BOJ to intervene once again in the FX market to prevent the yen from recording more gains against the greenback which hurt the Japanese economy. The EU debt crisis still dominates investors’ sentiment and reflected negatively on other economies performance, which is drawing a pessimistic outlook for the global economy, pushing investors to abandon riskier assets. On Monday at 23:50 GMT (Sunday), Japan will issue Merchandise Trade Balance for October, where it’s expected to show surplus of 28.8 billion yen compare to the previous surplus of 300.4 billion yen. The Adjusted Merchandise Trade Balance for October is expected to show a deficit of 82.0 billion yen widening from 21.8 billion yen deficit. At 04:30 GMT, the Japanese economy will release the All Industry Activity Index for September, where it’s expected to fall by 1.0% from the previous reading of –0.5%. Coincident Index for September will be released at 05:00 GMT, where it had a prior reading of 88.9, while the Leading Index for the same month had a previous reading of 91.6. At 15:00 GMT, the U.S. economy will release the Existing Home Sales for October, where it’s expected to come at 4.80 million down by 2.2% from the previous reading of 4.91 million which is down by 3.0%.

GBP/USD Technical Analysis for November 21, 2011

GBP/USDfell during the session on Friday after an initial bounce to form a shooting star. The pair looks weak, and rightfully so as the Bank of England continues to hint of further quantitative easing to come. The meeting this coming week should give traders new direction in the value of the Pound, and it also looks like they are already deciding it as rallies continue to be sold off. The breaking of the Thursday and Friday lows would signal more selling to come, and send us down to the 1.55 level rather quickly in our opinion. The pair cannot be bought at this point as the fundamentals and technicals are both pointing to a lower exchange rate in the cable.

GBP/USD Fundamental Analysis for November 21, 2011

On Monday, while the U.K. economy lacks fundamentals, as of 15:00 GMT, the U.S. will release existing home sales which are estimated to record 2.2% drop in Oct. compared with a prior of -3.0%. TheU.S.data will be carefully watched to follow the development in theU.S.economy especially as the latest data is showing the world’s no.1 economy is showing progress and may lead global economies to recovery in the fourth quarter. The better-than-forecastedU.S.data released last week managed to ease the tensions spreading in markets on the back of the rise in Spanish and French bond yields which renewed concerns the debt contagion is spreading among the euro region’s largest economies. However, the pair will probably be affected by the general sentiment which is focusing on the latest development from the euro zone. In fact, the outlook for the British economy is clouded with uncertainty.  Last week, the Bank of England (BoE) said in its quarterly inflation report raised concerns as it mentioned that growth outlook is now weaker and inflation will fall sharply over 2012, referring that the outlook for both growth and inflation is likely to depend on the latest developments in the euro zone. The dollar benefited last week from the turmoil in markets as it advanced as a favourite safe haven and may continue its advance if the tensions continued to haunt investor’s behaviour.

USD/CHF Technical Analysis for November 21, 2011

USD/CHFfell during the session on Friday, but managed a bounce later in the session to print a hammer. This candle is at the top of a run, and looks like it is showing pressure to the upside at this point. The breaking of the recent highs in the 0.93 level would be massively bullish for this pair, and it would also make sense as the Swiss National Bank is working against the value of the Franc presently. The Dollar remains the safe haven trade, and as long as there are headline of gloom and doom coming out frequently, this pair really should rise overall. We like buying dips at this point.

USD/CHF Fundamental Analysis for November 21, 2011

On Monday, the Swiss economy will start the day with the release money supply M3 for the year ending Oct. at 08:00 GMT. As of 15:00 GMT, the U.S. will release existing home sales which are estimated to record 2.2% drop in Oct. compared with a prior of -3.0%. TheU.S.data will be carefully watched to follow the development in theU.S.economy especially as the latest data is showing the world’s no.1 economy is showing progress and may lead global economies to recovery in the fourth quarter. The better-than-predictedU.S.data released last week managed to ease the tensions spreading in markets on the back of the rise in Spanish and French bond yields which renewed concerns the debt contagion is spreading among the euro region’s largest economies. However, the pair will probably be affected by the general sentiment which is focusing on the latest development from the euro zone. The dollar benefited last week from the turmoil in markets as it advanced as a favourite safe haven amid speculations the SNB may intervene again to raise the franc’s cap against the euro. This week, the main focus will be on Swiss trade data, amid speculations the SNB may intervene again to raise the franc’s cap against the euro, especially as the recent Swiss companies’ earnings reports showed the profits were negatively affected by the franc’s appreciation. In theU.S., the main highlight will be GDP 3q annualized second reading, minutes of FOMC meeting and other important data.

EUR/CHF Technical Analysis for November 21, 2011

EUR/CHFfell during the session on Friday as the pair continues to tread water just below the 1.25 level. The pair’s inability to rise even when the Euro rises against the Dollar is rather telling, and shows how much distrust of the Euro there really is at the moment. Because of this, we are not willing to buy this pair until we close above the 1.25 on a strong green candle. We can’t sell – the Swiss National Bank is working against a strong Franc.

EUR/CHF Fundamental Analysis for November 21, 2011

The EUR/CHF is about to start a new week on Monday with little in store for the pair as the trading range remains tight and confined. On Monday the market will open to reaction on the new government formed inSpainas they hold the General Election on Sunday November 20 and by the time the market opens the new face of the government will show. Expectations are for the opposition People’s Party to overtake majority and end the Socialist government’s rule, the market might still find support in the news as they also support further adjustment and austerity to bring the deficit down to 4.4% by next year! We still see the week focused on the euro area with the debate how to contain the crisis, especially as now the option of the ECB lending the IMF to lend troubled states reemerging and to see if there is more talk of it which might support the sentiment that some progress is being made. The data will start with the Swiss economy will start the day with the release money supply M3 for the year ending Oct. at 08:00 GMT. The euro zone will start this week at 09:00 GMT with the current account figures for September, where the previous non-seasonally adjusted deficit was 6.3 billion euros, while the previous seasonally adjusted deficit was 5.0 billion euros.

AUD/USD Technical Analysis for November 21, 2011

AUD/USDfell during the session on Friday after an initial bounce to form a shooting star. The pair looks weak, and the rallies are all being faded at this point. The parity level should offer some support, and we think that another bounce could be coming just under this area, perhaps at the 0.99 level. However, as long as the headline risks out there keep coming, the pair will continue to grind lower. This pair is very popular, so be aware of the fact that the move down will more than likely be a grind, not a sudden move. We sell rallies, and do not buy this pair.

AUD/USD Fundamental Analysis for November 21, 2011

The AUD/USD pair dropped last week to its lowest level in five weeks, as the greenback soared against most of its major counterparts due to risk aversion that controlled the financial market recently. Aussie lost momentum after the Reserve Bank of Australia lowered the interest rate and indicated that they will keep the rate at those levels till the end of the year, which reduced demand for the Australian currency. The Chinese economy also reduced demand on raw materials from Australia, as a result of their policy to cool down the economy in order to fight the current inflation pressure, which affected negatively on the Australian economy that is considered China’s biggest trade partner. On Monday at 15:00 GMT, the U.S. economy will release the Existing Home Sales for October, where it’s expected to come at 4.80 million down by 2.2% from the previous reading of 4.91 million which is down by 3.0%.

USD/CAD Technical Analysis for November 21, 2011

USD/CADrose during the session on Friday as the pair continues to grind higher just below the 1.03 level. The pair’s has been in consolidation recently, and the oil markets have been pushing it around. The 1.03 level does look vulnerable, and we are waiting for a daily close above it to send this pair to the 1.07 mark. The failure to do so would lead to more consolidation which has been very choppy. The easiest trade will be to buy at this point, if the market gives us this signal.

USD/CAD Fundamental Analysis for November 21, 2011

The USD/CAD pair rebounded to the downside on Friday, where the U.S. dollar weakened against major currencies after the ECB announced it bought bonds in the secondary market to ease mounting fears over the outlook of the euro zone debt crisis. Moreover, the U.S. leading indicators rose above projections, which provided investors with hope over the outlook for the world’s largest economy. Meanwhile, Canada released the CPI for October, where CPI eased in October but CPI inflation rose above expectations, which provided the Canadian dollar with bullish momentum that pushed the USD/CAD pair to the downside. Moreover, the leading indicators in Canada rose in October above median estimates, which also put negative pressure on the USD/CAD pair. Traders will continue to monitor the developments from Europe regarding the debt crisis, where anxiety remained high amid the high level of uncertainty over the outlook of the euro zone debt crisis. The USD/CAD pair should still be able to rise if concerns from Europe continue to dominate global markets, but we still expect volatility to continue to dominate trading, and that should also lead to high levels of fluctuations for the USD/CAD pair. Monday November 21: Canada will release the wholesale sales index for September at 13:30 GMT, which is expected to rise by 0.5% following the prior rise of 0.2% in August. The United States will join the session at 15:00 GMT with the existing home sales figures for October, with expectations that the existing homes sales could have retreated to 4.80 million houses from 4.91 millions. In addition, the monthly existing home sales index could show that sales dropped by 2.2% from the previous drop of 3.0%.

NZD/USD Technical Analysis for November 21, 2011

NZD/USDfell during the session on Friday after an initial bounce to form a shooting star. The candle shows just how hard of a time the bulls are having in this pair, and that the 0.75 seems almost to be a given at this point in time. The pair will face support there, but we think any rallies are to be sold at this point as the headline risks out there are too great to think the riskier currencies aren’t going to get hit.

NZD/USD Fundamental Analysis for November 21, 2011

The NZD/USD pair lost more ground last week where the Kiwi continued its downside movement against the US dollar due to risk aversion that controlled the financial market. The NZD/USD pair is to record more losses during the upcoming period, as the current market sentiment in addition to the slowdown in top economies are increasing fears between traders and driving them to safe assets. On the other hand, the EU debt crisis still has its negative effect on the financial market and on other economies, which fuels fears over the global economic outlook and driving investors to abandon higher-yielding currencies. On Monday at 15:00 GMT, the U.S. economy will release the Existing Home Sales for October, where it’s expected to come at 4.80 million down by 2.2% from the previous reading of 4.91 million which is down by 3.0%.

 

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