Forex Update 11 November 2011

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Forex Trading: 11 November 2011

The euro has managed to find a little bit of support around these levels and is at $1.3640 at the time of writing. Traders are still very wary of the single currency following the sharp sell off recently and increased volatility in the forex markets.

Clients have actually been sticking with a bearish view of the euro, which is not what they usually do when a market is trending lower as they often oppose the trend.

This time they clearly feel EUR/USD has further lower to go following the recent small bounce. Support and resistance for the pair is seen at $1.3500/1.3460 and $1.3700/50 respectively.

The recent euro weakness has given GBP/EUR a boost taking it up above €1.1700 where once again it has run out of momentum.

The little bounce in the euro has brought us back down to €1.1670 at the time of writing so will history repeat itself and bring this pair back lower again?



Forex Trading: 10 November 2011

The Euro has remained the whipping boy on the forex markets, trading down at $1.3540, as the Eurozone debt crisis continues.

Economic data today comes in the form of the Bank of England's interest rate decision where things are expected to remain on hold after having extended quantitative easing last month.

After their claims that the first round of QE helped to boost GDP, the pressure will be on them this time for their actions to have a material effect on UK growth and job creation.

For people on the street the real worry is rising prices and unfortunately whilst QE might give a boost to GDP, we've seen that it is only short term and it also puts pressure on underlying inflation.



Forex Trading: 09 November 2011

The euro received a bit of a boost on the back of Berlusconi announcing he'll step down and the news of the formation of a "caretaker" Greek government which is to take them into the next election.

Traders can expect EUR/JPY to see a continuation of the recent volatility as the yen has crept higher again causing the Bank of Japan to mention they will intervene further to make their currency weaker.

The euro is trading lower this morning against the yen at ¥106.95, breaking below its previous support level, which could signal heading towards ¥106.50 where it finds its next support level.



Forex Trading: 08 November 2011

Economic data is thin on the ground today although there's manufacturing and industrial production from the UK.

A rise is expected for the month of September, following the relatively decent PMI figures released back then, but we know this probably won't last as the PMI data for October was poor, coming in below 50.

Forex traders fled the riskier currencies and piled into safe havens such as the dollar and yen. Having said that, we could see a hefty jump in the euro if Berlusconi does step down.

The euro has been trading sideways in a tight range against the dollar, and it seems traders are just waiting to see what the next moves are. EUR/USD is trading at $1.3760 with support at $1.3650 and resistance at $1.3820.



Forex Trading: 07 November 2011

FX markets are seeing a bit of risk aversion in line with equity markets this morning as the euro gets bashed up a little bit in early trade. The dollar is proving a bit of a favourite, just as it did throughout last week.

EUR/USD is just heading back below $1.3700 at the time of writing as the government bond yields for the PIIGS edge higher.

Interestingly the battle between the euro and sterling is seeing the balance of power just tip in favour of the pound.

GBP/EUR is attempting to have another go at the €1.1700 level, just as it did last week, with the rate at €1.1665 at the time of writing. This could attract some sellers of the pound as we've seen sterling fail at this level a couple of times before.



Forex Trading: 04 November 2011

The euro climbed against the dollar yesterday, back up to $1.3855, but has been trading in a very tight range since yesterday evening.

NFP figures today are almost certainly the factor that is keeping traders cautious about showing their hand until the release later this afternoon.

The euro - dollar forex pair is trading at $1.3803 inside a bullish channel that could signal further gains but as we all know, on NFP day anything can happen.



Forex Trading: 03 November 2011

Today, we'll initially see the UK services PMI number, which is expected to remain above 50.0 in expansion mode.

However, considering the manufacturing number dipped below 50.0 earlier in the week there maybe pressure to the downside. Services make up a huge part of our economy and are critical to GDP so these will be closely watched.

Then the ECB makes there interest rate decision, the first for new President Mario Draghi, and expectations are for him not to reverse Trichet's hikes just yet. Having said that, he may bring in the first cut next month but don't be surprised if we see a cut today considering all the turmoil in Europe.

The dollar fell on the currency markets yesterday as economic growth was revised and there was expectation that another lot of quantitative easing could be introduced.

The euro took advantage against its counterpart and had around a 50 pip jump, although that was slightly short-lived.

This morning the pair is trading down as traders are feeling the heat after EU leaders stated that they will suspend the next tranche of aid to Greece until the referendum is decided.

The EUR/USD is trading at $1.3701 and until there is a positive statement from somebody significant, we could see further downside over the short term.



Forex Trading: 02 November 2011

The euro, which suffered substantial losses in the last couple of sessions, is turning higher in line with European equity markets.

An emergency meeting between European leaders is getting underway today ahead of tomorrow and Friday's G20 photograph opportunity.

The markets are hoping to hear the announcement of a referendum date sooner rather than later and hopefully to be held next month.

EUR/USD is at $1.3775 at the time of writing having found support around $1.3630 and the bulls will be targeting $1.3860.

Just as investors were starting to see the silver lining around the cloud, turmoil hit the financial markets.



Forex Trading: 01 November 2011

Yesterday Greek PM Papandreou shocked the FX markets by saying that he is going to hold a referendum on whether they should accept the bailout or go bankrupt.

As a result, the euro reversed almost half of a month long rally against the dollar, tumbling 440 pips, and is now trading at $1.3699.



Forex Trading: 31 October 2011

Major news on the forex markets this morning, with Japan intervening to make their currency weaker and therefore encourage trade.

The yen fell nearly 4% early doors this morning to ¥79.529 per dollar and in turn, created a hike in Japanese exporters.

We could see a trigger here in other Asian countries in order to protect their own exports, so forex traders should watch closely here. USD/JPY is currently trading at ¥78.741 and we could see the potential to move higher throughout the day based on fundamental news.


By Simon Denham, 11 November 2011


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