Happy July 4th Holiday!

July 2, 2009

Outlook for Non-Farm Payrolls, How to trade it

July 1, 2009

I was on Bloomberg Television earlier today talking about the outlook for non-farm payrolls and how the dollar could react to it. For my full NFP and ECB Preview, make sure you read my special report What to Expect for ECB and Non-Farm Payrolls

Find more videos like this on www.truveo.com.

Read the rest of this entry »

Posted in Bloomberg, Forex Technicals, ecb rate cut, forex blog, forex seasonality, non-farm payrolls

1 Comment »

USD/JPY Could Rise in July

July 1, 2009

In 8 out of the past 10 years, the U.S. dollar appreciated against the Japanese Yen in the month of July. Based upon seasonality, we could expect further strength in USD/JPY.

July is a very unique month in the currency market because not only do we have strong cases of Seasonality, but it also happens to be the worst performing month for certain currencies. Take a look at Which Currency Pairs Perform the Worst in the Month of July?

USD/CAD and Energy Correlation

July 1, 2009

It is no secret that Canada owns one of the world’s largest oil reserves. There it is logical to assume that USD/CAD would be correlated to oil prices. We have shown the results of this study often and even showed a recent chart illustrating the correlation no FX30.com (Oil and USD/CAD chart).

However, here is another correlation that you may find interesting. USD/CAD has a nice positive relationship with the energy sector ETF which makes logical sense. So if you are trading USD/CAD, make sure you keep an eye on the ETF for any anomalies.

Read the rest of this entry »

GBP/JPY Could Break 160 on Fixing Flows

June 29, 2009

**Update on 6/30/09 at 1:30pm - GBP/JPY hit an intraday high of 160.27, hopefully you were able to bank some pips on this trade. The reversal candle that we have right now suggests that we could see a deeper pullback to 156.

We have a nice upside breakout in GBP/JPY this morning that has been driven by the strong rally in equities.

Tomorrow is also the end of the month, quarter and half year which means that fixing flows could lead erratic intraday activity over the next 24 hours. Typically fixing flows are partially based upon relative performance of stock markets over the past month, but because tomorrow is the month and quarter end, we could see divergent buying patterns by fund managers. This is because on a monthly basis, the S&P 500 outperformed the German DAX and U.K. FTSE but underperformed the Nikkei. On a quarterly basis however it underperformed the DAX and Nikkei but outperformed the FTSE. If the month and quarter to date performance were in line directionally, the fixing flows would be easier to predict.

However U.K. stock markets have dramatically underperformed Japanese equities which should pave for GBP/JPY buying over the next 24 hours. First quarter GDP revisions and the current account balance are also due for release tomorrow. The trade deficit narrowed in the first 3 months of the year, which means that the current account deficit should have narrowed.