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Published at 19:21 (GMT) 30 Jul 3:20 EDT - USD/MXN is finishing weak, threatening a clean break from this week's bearish consolidation. An extension beneath 12.605 would confirm this potential scenario and target 12.526 or lower next week. MV

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Published at 14:48 (GMT) 30 Jul

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Published at 14:01 (GMT) 30 Jul US University of Michigan's final CSI has come at 67.8, just above the consensus of 67.00 and up from the initial levels of 66.5. The combination of surprising strength in the Chicago PMI and the stronger than expected University of Michigan CSI has set the market even further on edge in advance of this afternoon's 16:00 bst fixing where until today's drop in equities, the talk was that USD was vulnerable to large hedge related sales. M.B.

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Published at 13:42 (GMT) 30 Jul 30 Jul EUR/GBP Daily 14:35 - EUR has fallen steadily back from the .8394 area and a test right back to .8309 is in focus. This should hold at least near term, but if it does fail look next for .8242 and .8217. Resistance is now at .8365 then through congestion to .8394/95. [AW] R5: .8446 61.8% 20-28 Jul drop R4: .8438/44 hour highs, cong. R3: .8415 * 27 Jul high R2: .8394/5 hour, 29 Jul highs R1: .8365 hour high, congestion S1: .8327/22 current 30, 29 Jul lows

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Published at 13:21 (GMT) 30 Jul The month-end is upon us and the price action so far has failed to live up to expectations. The USD purge that was suppose to take place as a result of hedge adjustments is now in jeopardy due to the relatively dramatic equity decline. USD/JPY is playing according to script, equities down, risk appetite shrinks, JPY demand climbs, no matter what Japanese official say or do. The intraday low on USD/JPY of 85.95 is the lowest trade since 30 Nov 2009 when the low

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Published at 12:34 (GMT) 30 Jul The confusing relationship today is the CAD advance, without any news in advance of the GDP release, while equities were tumbling. An unusual breach of tendencies to say the least. Canada's release of May GDP showed growth at 0.1% m/m after seeing no growth in Apr. The May outcome was in line with the 4Cast and market estimates for growth of 0.1-0.2% m/m. So far the CAD reaction has been muted, but with US GDP data undershooting expectations, the markets are

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The appetite for risk waned across the financial markets, in line with expectations. Most of the European and commodity currencies turned down in Europe, while the yen remained in demand. Only the Swiss franc and the Canadian dollar are opening a tad higher in the US. The Asia/Pacific stock markets and the European bourses are down, while the gold/oil spread turned up. Therefore, the breakdown of the correlation between the European and commodity currencies and the stock markets was short

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Forex News and Events: FX markets continue with their choppy, noncommittal trading pattern. But as investors concerns ease and EU spreads tighten significantly, markets are leaning towards selling USD (interestingly not case with other safe-have FX trades like JPY and CHF) and buying of risky assets. But given that summer trading pattern is in full effect, we are seeing a variety of small time news events having a distortional effect on prices. Case in point, St Louis Fed President Bullard's

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Published at  09:03  (GMT) 30 Jul Eurozone Flash HICP for July was 1.7% y/y, up from the 1.4% y/y in June and in line with market estimate of 1.7% y/y. Eurozone employment data was also released and the June rate was 10%, unchanged with the prior month and as expected from a market perspective. This data does not tend to move markets and today is no exception. M.B.

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The yen strength continued into Asian trading today with the USD/JPY dropping to an eight month low at 86.25 as the dollar weakened. Earlier comments in New York from Federal Reserve St. Louis President Bullard spooked markets with his unusually dovish tone as he commented that, “the US is closer to a Japanese-style (deflationary) outcome today than any other time in recent history…� He added that although the need for further easing is unlikely, the FOMC must be prepared to face such a

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Headlines Crude gains ahead of today’s second quarter U.S. growth figures Weaker greenback adds to gold price Base metals rise ahead of reporting season for mining sector

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Today’s Comment CHF has appreciated considerably since its opening yesterday – due, among other things, to an article in the Wall Street Journal, claiming that the Swiss central bank (SNB) is in the process of dumping part of its large euro holdings which it hoarded during this year’s ill-fated intervention programme. The SNB’s sale of EUR should according to the article have taken place over the past 10 days. The article does not mention which currencies the SNB bought instead of EUR (i.e.

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Quote: ‘Beauty is the battlefield where God and the Devil war for the soul of man.’ Fyodor Dostoyevsky (1821-1881) The News: Fed officials Bullard and Fisher clash over policy to stimulate the economy. The Numbers: British Summer Time, with expectations and previous figures in brackets. 00:01 GB July GfK Consumer Confidence –22, lowest in 1 year, vs –19 June on worries over government spending cuts. 00:30 JP June Jobless 5.3%, Job-to-Applicant 0.52, versus 5.2% and 0.50 May. 00:30 JP June

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Published at 06:01 (GMT) 30 J ul 30 Jul USD/CHF Daily 06:50 - The mkt. has stabilised over the last several hours after it made a new reaction low yesterday at 1.0372. This is first sup. now followed by 1.0363 then 1.0340. Close res. is at 1.0430 while the stronger area should be 1.0450/60. Further modest recovery looks possible over the next few hours.N.I. R5: 1.0579 Thurs high R4: 1.0535 * intraday level R3: 1.0500/10 intraday level R2: 1.0480 intraday level R1: 1.0450/60 intraday level S1:

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Published at 05:52 (GMT) 30 Jul 30 Jul AUD/USD Daily Settled back from the .9044 high to consolidate strong rally from the .8906/08 low. Scope is seen for further extension to target the .9069 high, clearance will target the .9100 level then .9135. Support is at .8975 and .8945/50, failure here expose the .8906/08 lows to retest. [P.L] R5: .9118 5 May high R4: .9095 6 May high R3: .9078 * 10 May high R2: .9069 * 27 Jul high  R1: .9044 29 Jul high S1: .8975 hourly low S2: .8945/50 intraday

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USD Under Pressure, Euro Tests 1.3100 U.S. Dollar Trading (USD) risk aversion helped the USD off lows but for most of the day the world’s reserve currency was under pressure with EUR/USD leading the market higher. Q2 Company results were a little weaker than expected but Weekly Jobless Claims fell to 457k vs. 464k previously. In US stocks, DJIA -39 points closing at 10497, S&P -7 points closing at 1107 and NASDAQ -23 points closing at 2264. Looking ahead, Weekly Jobless Claims are forecast

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With the equity market under pressure, the UltraShort Real Estate ProShares (NYSE: SRS) is rallying off of its three-day support plateau at 22.75, which has propelled the ETF above near-term resistance at 23.80, towards a possible confrontation with its July down trendline, now at 25.15. Moving over to the emini S&P 500, my 4-hour chart work continues to warn me not to trust the intraday recovery rally from 1088.75 to 1100.00, and to be prepared for yet another loop to the downside that

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Euro Rallies as Economic Confidence Tops forecast, German Unemployment Declines British Pound Continues to Trend Higher Ahead of GfK Consumer Confidence Survey  Australian Dollar Regains Footing as Swan Talks Down Recent Inflation Report  Japanese Yen Rallies Extends Yesterday’s Advance On the Back of Risk Aversion  New Zealand Dollar Pushes Lower Following Dovish Comments Subsequent to RBNZ Rate Hike Dollar Struggles Ahead of 2Q GDP – Fed Maintains Dovish Outlook U.S. Dollar

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Published at 02:32 (GMT) 30 Jul Steady dollar index in pre-lunch Asian and negative open on HSI -0.34% saw USD/HKD churn within 7.7655-7.7670 with dollar shorts also clipped on corporate bids at retreats. Test below 7.7650 looks beyond reach in the near-term on underlying caution on sluggish US economic indicators, with US GDP numbers due later today likely to reflect Wed's Fed beige book's bearish outlook. USD/HKD 12-month forwards seen inching right, trading at discounts of -195 to -210bps -

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The foreign currencies futures consolidated quietly in the Far East on the last business day of July after closing up across the board on Thursday. The Asia/Pacific stock markets, gold and oil are down. I don’t like this (probably short-lived) breakdown of the correlation between the European and commodity currencies and the stock markets. If and the European bourses follow the US markets down, the European and commodity currencies should turn down as well.  On this fragmented

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GOOD MORNING! EQUITIES The US Equities closed down in a volatile session yesterday. The investors are confused between upbeat Corporate earnings and disappointing Economic Data release in the past few days. The markets will closely look at the first reading of the April-June US GDP, scheduled later today. The Dow (10467.16) was down 0.29% and the S&P 500 (1101.53) was down 0.42%. We continue to hold our view of an immediate Resistance on the Dow near 10500-25 region, a break above which

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Published at 00:32 (GMT) 30 Jul USD/JPY, Cross/JPY lower as DPJ official says strong JPY should dealt not with intervention, but monetary easing - thus taking risks of intervention off the table, at least for now. DPJ official says up to BoJ to decide policy, but buying more JGBs an option -Reuters. Risk aversion also weighing on Cross/JPY after series of weaker data, with Nikkei -1.02%, focus on US Q2 GDP today for signs of slowdown and China PMI on Sunday. USD/JPY at 86.50-55, eye 8-m

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Market Review - 29/07/2010 22:56 GMT Euro surges above $1.3100 on upbeat European economic data The single currency broke above the $1.31 level for the first time since May as German unemployment decreased while European confidence in the economic outlook rose to the highest level in more than two years this month.       Despite euro's initial brief dip to an intra-day low of 1.2977 in Thursday's Asian morning, the pair then rebounded from there and ratcheted higher on

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The U.S Dollar opened this morning lower across the board based on a Moody’s report which stated “If U.S. government budget projections are realized in coming years, the country's triple A rating would come under scrutiny�, and went on to say the United States appears to have "no plan" to deal with its fiscal outlook. Keep in mind less than 24 hours ago California Governor Schwarzenegger declared a state of emergency over the state's finances (current budget is more than a month overdue and

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EURO The euro appreciated vis-à-vis the U.S. dollar today as the single currency tested offers around the US$ 1.3105 level and was supported around the $1.2975 level. The common currency traded above the $1.3100 figure today for the first time since 4 May 2010 as improving risk appetite continued to support higher-yielding currencies.  Data released in the U.S. today saw weekly initial jobless claims decline to 457,000 from a revised 468,000 print last week while continuing jobless claims

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Te foreign currencies futures rallied across the board on Thursday, squashing expectations for a medium-term top. However, the US stock indexes spiked down after St. Louis Fed President Bullard said he thinks that the Fed may have to take the more severe measure of buying government debt if the current economic weakness becomes a more serious, prolonged problem. Bullard’s comments added to Fed’s Beige book’s findings of a faltering US economic recovery. The foreign currencies futures closed

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Published at 19:03 (GMT) 29 Jul 3:00 EDT - USD/MXN is still in a bearish consolidation, unable to extend the Jul decline. Sustained trade below 12.712 (NY closing basis) will keep it primed for a new drop and only a move back above the extended TL (12.784, rising roughly .145/day) can reverse the S/T posture. MV

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Published at 19:44 (GMT) 29 Jul 3:40 EDT - USD/JPY has worked its way back above the 86.73/80 zone in late NY trade. If the mkt can remain north of 86.73 its S/T posture will remain neutral, but another dip below it will bring the Jul lows into focus. MV R5: 88.12 * 28 Jul high R4: 87.75 intraday level R3: 87.51 current high R2: 87.2 intraday level R1: 86.73/80 * 23, 29 Jul lows S1: 86.34 22Jul low S2: 86.27 * 16 Jul low S3: 86 figure S4: 85.83 30 Nov low S5: 85.24 * 100% ext 12-16 Jul

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Eur/$ has indeed continued higher, breaking above the July 20th high at 1.3030 and on way toward the long held 1.3120/35 resistance area next (38% retracement from the Nov high at 1.5140). However, the market is nearing overbought after the gains from the Nov low at 1.1880, is potentially within the final upleg from that low (wave 5, see numbering on daily chart below), lots of other currencies are reaching longer term $ support areas (cable at 1.5630/50, 50% retracement from the Aug 2009 high

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The FXCM Speculative Sentiment Index is an excellent tool to gauge trader positioning and sentiment in the FX market. Unlike major equities or futures markets, there is no single centralized exchange for forex trading. Such decentralized activity makes finding uniform volume or open interest data impossible. DailyFX fills the gap by offering access to FXCM’s proprietary volume and positioning information—giving an unparalleled view of forex market sentiment. Learn How to Use the SSI.

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Published at 12:38 (GMT) 29 Jul BRL marginally up 0.2% despite strong 0.6% gain in EUR and 0.5% surge in S&P futures. The moderate gain underlines market concern that the BCB may intervene and also the more dovish BCB outlook on monetary policy. Locals still looking at what will be the final decision from BCB regarding the reverse swaps but with the Cupom Cambial there should be already some impact on the Banks desire to extend long BRL positions using the carry trade. Di curve gains are

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Most indicators are suggesting that risk appetite rose further this morning. European equities indices have performed well, EUR/USD is pushing higher as is AUD/USD and cable. However, the trends exhibited by the JPY and gold have been less certain. US data is patchy at best and this will likely ensure that optimism is kept in check. The recent slow crawl upwards in EUR/JPY reflects improved risk appetite but the reluctance to break above 114.20 this morning reflects doubts as to direction.

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The foreign currencies futures rallied across the board in Europe, squashing expectations for a medium-term top. The move owes to a deadly cocktail of concern over the health of the US economy vis-à-vis the apparent steady economic recovery in the Eurozone. The unexpected rise in the appetite for risk was backed by the rising European bourses. Yet, the gold/oil spread is still slightly up. The US stock indexes are up in pre-open market.  The short-term outlook turned bullish the foreign

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Forex News and Events: Markets are trading in a lethargic manner as participants continue to nervously take on risk-correlated trades. The move toward risk is logical because without the massive sovereign crisis fear hovering over the market like the Sword of Damocles, one needs to consider the fundamentals - particularly monetary policy, as the core driver. Overall, the rate at which central banks are mopping up excess liquidity has been slower-than-expected with the BoE and Fed still

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Published at 10:16 (GMT) 29 Jul Lots of stories for the next few days. On top and imminent is the story that there will be a major USD selling program on Friday related to international investor hedge adjustments. The sovereigns are back on both sides of the market and combine their bids with some good sized buying from US money center and investment banks recently and it is easy to see why options defence of the 1.3050 failed to hold. Finally, and probably the most compelling, is the ongoing

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Headlines Unexpected rise in U.S. crude inventories eases WTI price  Weak U.S. statistics bring gold into investor’s focus  Copper price increases on global economic prospects Brent and Distillates U.S. crude declines on Wednesday after Department of Energy data showed an unexpected rise in U.S. crude inventories as imports rose and U.S. consumer confidence and durables plunged, prompting investors to sell off riskier assets including oil. But the report showed also some gains in