Reviewed Forex Trading

USD Dollar (USD) – The US Dollar weakened against the major currencies as negative data was released. The ISM Manufacturing PMI came out at 54.1 vs. the expected 54.6 and the ADP Non-Farm Employment Change came out at 170K vs. the forecast 189K, decreasing demand for safer assets. Wall Street closed positive as the S&P increased by 0.89% and the Dow Jones by 0.66% respectively. Crude oil decreased by 0.90% to its lowest level in six weeks following Oil Inventories data which was higher than expected, closing at $97.61 a barrel. Gold (XAU) strengthened by 0.35%, reaching the highest price in seven weeks, finishing at $1734.55 an ounce. Today, the Fed Chairman, Bernanke, will speak. The Initial Jobless Claims are expected to be at 373K vs. 377K last week and the Prelim Nonfarm Productivity is expected to decrease from 2.3% to 1.0%.

Euro (EUR) – The Euro rose against the Dollar for the first time in three days as Final Manufacturing in the region came out better than estimated (48.8 vs. 48.7 forecast), indicating that Europe’s economy might be stabilizing. The EUR/USD’s momentum is positive above the 1.3080 level and as long as the pair is trading above this level the Euro may continue to rise and will probably break up at the next resistance level of 1.3250. Overall, the EUR/USD traded with a low of 1.3026 and with a high of 1.3218. No major economic data is expected to be published.

EUR/USD – Last: 1.3179

British Pound (GBP) – The Pound strengthened against the Dollar, closing to a two and a half month high as Manufacturing PMI in the UK came out better than expected at 52.1 vs. 50.1 and negative data was released in the USA, supporting a weaker Dollar. As long as the GBP\USD is trading above the 1.5750 level, the Pound’s momentum continues to be bullish and the next resistance level on the one hour chart is located at 1.5885. Overall, the GBP/USD traded with a low of 1.5706 and with a high of 1.5882. Today, the Construction PMI is expected to come out at 52.8 vs. 53.2 previously.

GBP/USD – Last: 1.5850

Japanese Yen (JPY) – The Yen strengthened against the Dollar for the fifth day as a weaker US Dollar led investors to stick with the Yen. The USD/JPY’s momentum is bearish as long as the pair is trading below the 76.50 level and only if the pair breaks this level, will the Dollar be attractive again. The next support level is located at the 76.00 level. Overall, the USD/JPY traded with a low of 76.02 and with a high of 76.35. No economic data is expected to be published.

USD/JPY-Last: 76.14

Canadian dollar (CAD) – The Canadian Dollar rose versus the US Dollar as stocks and risky currencies closed positive, causing higher yielding assets to be more attractive.  As long as the pair is trading below the 1.0070 level, the US Dollar’s momentum is negative. The next support level on the one hour chart is located at the 0.9960 level and breaking this level will probably cause the pair to decrease toward the 0.9900 level. Overall, the USD/CAD traded with a low of 0.9963 and with a high of 1.0048. No economic data is expected to be published.

USD/CAD – Last: 0.9974                                                 

USD Dollar (USD) – The US Dollar declined against the major currencies after Greek Prime Minister, Papademos, said that major progress has been made in debt-swap talks. The  Fed Bank of Philadelphia President, Plosser, said that the US Treasury may need to raise the main interest rate this year and that last week’s pledge to keep rates near zero through late 2014 is not a firm commitment. Wall Street closed negative as the S&P decreased by 0.25% and the Nasdaq declined by 0.16% respectively. Crude oil rose by 0.10% from a one week low, closing at $99.30 a barrel, as investors speculated that fuel demand may climb after industrial production in Japan rose by 4%. Gold (XAU) rose by 0.20%, finishing at $1736 an ounce. Today, the Chicago PMI is expected with 63.10 vs. 62.50 previously and the CB Consumer Confidence is expected with 68.20 vs. 64.50 previously.

Euro (EUR) – The Euro strengthened versus the US Dollar after the Greek Prime Minister said that major progress has been made in debt-swap talks. However, Euro leaders left a Brussels summit late yesterday with no accord over how to plug Greece’s widening budget hole. The EUR/USD’s momentum is positive above the 1.3080 level and as long as the pair is trading above this level the Euro may continue to rise and will probably break up at the next resistance level at 1.3300. Overall, the EUR/USD traded with a low of 1.3077 and with a high of 1.3210. Today, German Retail Sales are expected to grow by 0.90% vs. -1.00% previously and the Unemployment Rate is expected to be at 10.4% vs. 10.3 previously.

EUR/USD – Last: 1.3185

British Pound (GBP) – The Pound gained against the US Dollar after the pair did not succeed in breaking the support level of 1.5660. As long as the GBP\USD is trading above the 1.5600 level, the Pound’s momentum continues to be bullish. The next resistance level on the daily chart is located at the 1.5770 level. Overall, the GBP/USD traded with a low of 1.5653 and with a high of 1.5725. Today, Net Lending to Individuals is expected with 1.2B vs. 1.0B previously.

GBP/USD – Last: 1.5730

Japanese Yen (JPY) – The Yen strengthened against the Dollar to a three-month high on speculation that the Euro area’s unemployment is worsening amid the region’s debt crisis, boosting demand for Japan’s currency as a refuge. At the same time, Japan’s industrial output increased the most in seven months. The USD/JPY’s momentum is negative as long as the pair is trading below the 77.20 level and only if the pair breaks this level will the US Dollar be attractive again. Overall, the USD/JPY traded with a low of 76.20 and with a high of 76.76. No economic data is expected to be published today.

USD/JPY-Last: 76.20

Canadian dollar (CAD) – The Canadian Dollar gained against the US Dollar on a rally in crude oil. As long as the pair is trading below the 1.0070 level, the US Dollar’s momentum remains negative. Overall, the USD/CAD traded with a low of 1.0010 and with a high of 1.0069. Today, the GDP is expected to grow by 0.2% vs. 0.0% previously.

USD/CAD – Last: 1.0005                                                 

USD Dollar (USD) – The US Dollar weakened versus most major currencies as investors became more optimistic regarding the Greek Credit Swap negotiations, following remarks by the French Finance Minister. Both the NASDAQ and the Dow Jones declined by -0.09% as investors eye key earning releases from bellwethers such as Apple, later this week. Crude Oil gained by 1.51% closing at $99.81, following sanctions on Iran. Gold (XAU) reached a 6 week high after gaining 0.82% following Iran sanctions, closing at $1,677.70 an ounce. No major economic data is expected today.

Euro (EUR) – The Euro rallied to a 3 week high versus the Dollar after French Finance Minister, Baroin, said that there is progress in the negotiations between Greece and its private creditors. Stock exchanges in Europe finished higher, the DAX30 gained by 0.50% and the CAC40 by 0.51%. The EUR/USD is currently considered bullish as long as it remains above the 1.30 mark. The pair still faces many resistance levels around the 1.31 level. Today, German and French Flash Services and the Manufacturing PMI will be released. Industrial New Orders are expected with a -2.1% decline versus 1.8% previously.

EUR/USD – Last: 1.3020

British Pound (GBP) – The British Pound gained slightly versus the Dollar and the Yen following optimism in Europe regarding the Greek default swap. The Pound is being affected by speculations regarding a broadening of the British Quantitative Easing program. The FTSE 100 declined by -0.22% to 5,728.55. The GBP/USD continues to be bullish as long as it remains above the 1.55 support level. The pair is facing strong resistance around the 1.57 and 1.5750 levels. Today, Public Sector Net Borrowing is expected with 12.4B versus 15.2B previously. Investors await Wednesday’s MPC Meeting Minutes release to assess the possibility of a wider QE program.

GBP/USD – Last: 1.5560        

Japanese Yen (JPY) – The Yen finished unchanged versus the Dollar and weaker versus the other majors as demand for the safe haven of the Yen kept declining following increased market optimism. The BOJ is expected to leave the interest rate unchanged at 0.10%. Technically, the USD/JPY has been trading in a channel between 76.60 and 77.30 and located near a strong support level according to the daily chart at 76.60. Today, the Trade Balance is expected with 0.36T versus 0.54T previously.

USD/JPY – Last: 77.00

Canadian Dollar (CAD) – The Canadian Dollar gained versus the US Dollar following market optimism regarding the European debt crisis and a rise in crude prices following the EU leaders’ decision to sanction Iranian oil. EU’s sanctions raise concerns of a disruption in oil supply from the Middle East that could push crude prices higher. The USD/CAD is on a downtrend with strong support around the 1.0075 level. Today, Core Retail Sales are expected with 0.2% versus 0.7% previously. Retail Sales are expected with 0.3% versus 1.0% previously.

USD/CAD – Last: 1.0085