To all followers….

I wanted to let you all know, that I have been asked to join the crew at www.forexlive.com.  The contributors at Forexlive are top notch and I am excited to be bringing my daily analysis to their customers.  As of now, my daily commentary role will not change. I will continue to dedicate myself to you – the customer.

What has changed is I will be doing more educational seminars (www.fxddmasterslive.com) that will take me from the daily commentary from time to time. As a result, it made sense to combine forces so that when I am away, the continuity of the market moving news and analysis for our clients at FXDD is not compromised.  Jaime Coleman, Adam Button, Ed Craven, Gerry Davis, Joe Brown, etc., are all highly regarded and respected analysts with lots of contacts in the market.  We are all dedicated to the same goals, and look to make www.forexlive.com portal the go to site for forex news and analysis.

The transition is underway. It will take some time to get all the balls in total synch, but it makes a lot of sense for you, our customer.  Thanks for all your support!

JPY continues decline. NZDUSD and AUSUSD decline. GBPUSD stuck.

The USDJPY continued to move higher after breaking above key resistance at the 82.975 level. This is the 38.2% of the move down from the 2010 high and stalled the post Bernanke rally, but only briefly. In the asian session the price pushed higher and as NY enters it is trading near the highs. It is also pushing against channel trendline resistance on the hourly chart at the 83.577 level. There have been reports of earthquakes in Japan today which has helped contribute to the currencies weakness today.  In the EU, Spanish banks rose to the most on record as continued pressure in the region has forced central bank emergency borrowing. In other news out of the Eurozone, YoY CPI came in a touch lower a 1.5%, Industrial production increased by a less than expected 0.2% (vs 0.5%). The Switzerland ZEW Expectation survey improved to 0.0 from -21.2 last month. The moves higher in the USDCHF/EURCHF was slowed off the news. The SNB meets tomorrow and will likely once again comment on the value of the EURCHF. THe expectation is they reiterate their desire to keep the EURCHF above the 1.2000 level. In the UK the jobless claims change came out at +7.2K jobs vs 5.0K expected. THe ILO Unemployment rate (3 mo.) came in as expected at 8.4%. The GBPUSD has traded above and below the 38.2% retracement AND 100 day MA for the 2nd straight day (at 1.5700) level. This is saying to me the market is unsure of the direction for this pair at the moment. The 1.5700 level should continue to act as a pivot for the pair with the bias bullish above the 1.5700 area and bearish below the 1.5700 area. On the topside the 1.5745-55 area is resistance today. Below a break of 1.5790 targets 1.5673 – the midpoint of the weeks range. The NZDUSD and the AUDUSD fell and both are looking to test the 38.2% of their recent moves higher. The AUDUSD 38.2% comes in at 1.0472 (NY is opening at that level). The NZDUSD has the 38.2% and 200 hour MA at the 0.8084/88 area. Chinese Wen commented overnight that there are imbalances in the real estate market. Both Aust and NZ are influeces by what happens in China. The low for the day came in at the 0.8112 so far. Today in the US Mortgage applications fell 2.4%. Import prices are expected to show a 0.6%. The Current Account Balance is expected to show a -115.0 B deficit. Canada releases Cap Util for 4Q with 81.6% expected.

Shorter term traders trade….Keep EURUSD above the 1.3053 support

The selling has dominated in the EURUSD since the FOMC decision, but the traders continue to trade the levels. The proof is the bounce off support at the 1.3057 level – just above the key support at the 1.3053 level. The pair will now eye the 1.3081-88 level (see yellow area) as the traders resistance. If it holds resistance, there still is a chance for the key support to be broken. A move much above this level, would not be welcomed.

GBPUSD moves to support area as well

The dollar is improving on the better tone in the Fed statement

The FOMC notes a better economy with improved labor conditions cited.  They also removed a statement that business investment “has slowed” instead characterizing the business fixed investment as continuing to advance. They said that inflation may be effected by higher prices for oil and gas but the longer term inflation expectations remain stable. They said that the strains on the global financial markets have eased although they still pose risk.  So overall, a move toward a more favorable economic outlook. The Fed looks to keep the stimulus in place through late 2014.

The USDJPY has moved up to the 82.97 level. This is the 38.2% of the move down from the 2010 high. A break should trigger some stops.

The EURUSD has moved lower in choppy trading.  The pair is pushing the intraday support at the 1.3070 level. A break will next target the low at 1.3051. The 50% of the 2012 range comes in at 1.3053. This is a key support.

FOMC Decision awaited. Key levels to eye

A snapshot of the US Economic data

EURUSD sellers give up and the pair moves higher

As per the prior post, the EURUSD showed some signs of bottoming. The price held support at the 50% of the 2012 range. The price moved above some trendlines. The final straw was the break above the 38.2%-50% at the 1.3077/86 area.  Shorts covered and the price extended to the days midpoint.

When the market trends like it did for most of the London session, traders look for support in that move. When the momentum fades and the tide turns back higher, the trend thoughts disappear.  That is what happened today, so trend ended and the intraday sellers retreated and covered.

The FOMC decision is now awaited and the market traders will likely continue to use the technical levels to define the risk (support at 1.3077-86/Resistance initially at 1.31207 and then 1.3137 -see chart below). The Fed is expected to keep the policy the same.  The expectation is the Fed should soften somewhat but they may delay the positive for a further meeting.  Job growth has been averaged 244.7K over the last 2 months and the Unemployment rate remained steady at 8.3%, Retail Sales showed good sales today both from the headline and ex auto, Inflation remains in control, Auto sales for the current month was at the highest annualized rates since February 2008.  The Fed, however, remains concerned about the sustainability of the momentum.