Forex rebates on every trade - win or lose!

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Stormie: Didn't you do well! Nice when a plan comes together.

Evening, Choccie :)

Thank you folks, having had many false dawns (and plain old screw-ups..:-( ) it is nice to get a couple actually run to plan...:-)

hilary,

It is most kind of you to give us the benefit of your input once again, I am quite prepared to admit I need all the help I can get..:-)

'ello MM ;)

Oh well - I'm back into shorts again from 17710. I just feel the 17700s are going to be a toughie to crack, having given strong support last year.

Please! Don't confuse me any more than I already am...:-)

Forex - Dollar falls as economic uncertainty, oil price weigh - UPDATE 4
AFX


CHICAGO (AFX) -- The U.S. dollar fell Monday as traders questioned whether strong domestic economic data would be enough to fuel a flagging greenback rally amid signs of revitalization outside the United States.

'Uncertainty over the state of the U.S. economy continues to weigh on the dollar,' said Nas Nijjar, senior foreign-exchange dealer in New York with London-based CMC Group.

'Consensus, however, seems to be that there's a correction underway and this could continue for some time as traders lock in the profits that have been picked up in recent months. The high price of oil and wide [U.S.] trade deficit continue to cause a degree of concern and these two factors could well keep a lid on any further dollar gains.'

In late U.S. trading, the dollar declined 0.5% against the euro compared to where it stood late Friday, with Europe's shared currency quoted at $1.2187.

The dollar fell 0.6% against the British pound, with one pound worth $1.7685. The greenback was down 0.8% to 1.2781 Swiss francs.

Against the yen, the dollar was down 0.2% at 112.21 yen.

The dollar had scaled multi-month highs last month as the U.S. economy has been outshining the other major industrialized nations. European economic data, while still far from spectacular, may be showing a bottom, analysts say.

The dollar had trouble gaining traction on upbeat reports issued last week, leading analysts to suggest that the yield advantage afforded the dollar because of higher U.S. interest rates may not matter as much to currency investors.

That theme carried over to Monday. The dollar remained lower across the board even as trade group Institute for Supply Management said its manufacturing index rose to 56.6% in July from 53.8% in June, a 26th month of expansion and the best reading of 2005.

The euro-area Purchasing Managers' Index, released Monday, showed that manufacturing activity had expanded in July for the first time since March 2005.

The headline measure rose to 50.8 in July from 49.9 in June.

'At face value, this stronger-than-expected report further reduces the likelihood of an interest-rate cut from the European Central Bank in the second half of the year,' said Guillaume Menuet, senior economist with Moody's Investors Service, in London.

The ECB's target stands at 2% compared to the Fed's 3.25%, widely expected to be lifted to 3.5% next week.

'Coming hard on the heels of a two-point rise in the European Commission measure of industry confidence, this report is another sign of a probable bottoming out of confidence in the second quarter of 2005,' said Menuet.

The dollar's lackluster performance has put added emphasis on Friday's U.S. jobs report for July, which is expected to show another month of steady employment growth.

The dollar also felt the sting of high oil prices rekindled with the death, early Monday, of Saudi Arabia's King Fahd. Saudi television reported that Abdullah bin Abdulaziz Al-Saud, the Saudi crown prince and Fahd's half-brother, will succeed him, as expected.

The uncertainty that can surround any leadership change proved enough to send crude futures above $62 a barrel, despite assurances from the Saudis of no changes in oil policy. Abdullah has effectively been in charge since King Fahd suffered a stroke in 1995.

Saudi Arabia is the world's largest oil exporter and the dollar is negatively impacted by the high cost of imported oil in the United States. Expensive oil can expand the current account deficit.

That deficit, which factors in both trade and investment flows, was at the center of a three-year U.S. dollar decline that had paused so far in 2005.

The International Monetary Fund said late Friday that the U.S. dollar is still too overvalued to boost exports and curb the U.S. financing imbalance.

The dollar's declines were narrower against the yen as the Japanese currency also typically feels some pressure from expensive oil. Japan is reliant on imports for all of its crude and its exporters are sensitive to significant cuts in global spending that can be a casualty of high energy bills.

The most recent Chicago Mercantile Exchange-issued International Monetary Market (IMM) data showed that on net, currency speculators cut their long, or generally bullish, dollar holdings by $2.5 billion to $9.5 billion. This is the lightest long dollar holdings since May 10.

Dollar holdings were reduced against the euro, yen and British pound, but increased against the Canadian dollar.

Meanwhile, Asian currency plays continue to factor into broader foreign-exchange dealings, particularly in the wake of the Chinese policy move. Deutsche Bank pointed to rumors from late last week of about $500 billion being shifted into both the euro and the yen to optimize Asian reserve portfolios.

The dollar slipped to 8.1046 yuan compared with a level of 8.11 yuan when the Chinese central bank revalued the currency earlier this month.



This story was supplied by MarketWatch. For further information see www.marketwatch.com.

Forex - Dollar in broad decline, led by tumble against yen - UPDATE 3
AFX


CHICAGO (AFX) -- The dollar again fell broadly Tuesday, its steepest loss coming against the yen after upbeat comments from a Japanese central bank official restored hope the world's second largest economy will break out of its deflationary doldrums.

A handful of positive U.S. economic reports since last week have not been enough to shake the greenback from a downward correction launched in the wake of China's currency revaluation late last month.

'The data suggest that ... enough job and income creation is occurring to keep the economy growing at an above-trend pace and this could keep upward pressure on U.S. Treasury yields this week,' said Mike Carey, New York-based analyst with French investment bank Calyon.

'The dollar, however, continues to show little reaction to positive data releases and with markets already pricing in 4% fed funds by year end, the dollar may find it difficult to make further gains over the short term.'

Bank of Japan Governor Toshihiko Fukui said Tuesday the consumer price index may turn positive by the end of 2005 or early 2006.

His projection allowed Tokyo stocks to hit a 13-month intraday high, also boosting demand for yen.

The dollar was changing hands at 111.45 yen in late U.S. trading, down 0.8% from where it stood late Monday.

The greenback was also weaker against its European counterparts as a U.S. report's inflation component proved softer than expected, perhaps cutting the odds of aggressive Federal Reserve interest-rate hikes in coming months. Higher rates make dollar-denominated assets more attractive to foreign investors.

The dollar slipped 0.2% against Europe's shared currency. The euro was changing hands at $1.2196, held below tough chart congestion around $1.22 but also well supported above $1.20, traders said.

The dollar eased 0.2% against its British equivalent; one pound was fetching $1.7705.

Further currency gains will have to be justified by extraordinary U.S. data and indications the Fed won't stop its tightening cycle in 2006. Calyon analysts see further Fed moves in the pipeline.

Dollar trading showed little reaction to U.S. data on incomes and spending, but the report's core measure of personal consumption expenditures, which strips out volatile items like food and energy, drew some attention to its unchanged reading in June from May.

Economists thought the measure, a known favorite of the Federal Reserve, would creep higher.

'Although the eurozone economy continues to underperform the U.S., the bearish view on the eurozone means that it has been easier to deliver positive surprises. This is giving markets further reason not to expect any monetary easing from the European Central Bank, also helping to underpin the euro,' the Calyon analysts said in a note.

June euro-zone unemployment held flat at 8.7%, 'which is in keeping with recent downward trends in unemployment,' said Charmaine Buskas, analyst with Economy.com.

The euro's gains come on the back of news that Russia will increase its euro weighting in its currency basket which is used to value the ruble. The weight will now be 35% as compared to 30%, according to the central bank of Russia in a statement issued Monday.

The yen may also have trouble if oil continues to factor into investing decisions.

'Despite this official optimism [from the Bank of Japan], higher oil prices could limit the expansion in Japan and keep a lid on further yen gains,' said Buskas.

September crude was little changed at $61.55 a barrel in afternoon dealings as analysts turned their attention to Wednesday's U.S petroleum supply data from the Energy Department. Crude scaled uncharted territory above $62 a barrel on Monday.

Japan, a significant importer of oil, is also seen vulnerable to any impact higher energy prices may have in cutting global spending.

The dollar is also pressured by rising energy prices, which could aggravate the U.S. trade deficit.

Analysts from the Royal Bank of Scotland also noted that markets are keeping a close eye on whether Japan's upper house passes postal privatization bill on Friday.

'A failure to pass this legislation would be yen bearish,' the bank said.

A Russian central bank decision Monday to raise the weighting of euros in its dual currency basket has helped push the euro higher, said analysts from RBC Capital Markets.

As for the U.K., weak July manufacturing PMI data, which fell to 49.2 from June's 49.6, pretty much guarantees a rate cut on Thursday from the Bank of England, analysts from Anglo Irish Bank said.

Most central-bank watchers expect the benchmark interest rate to be lowered by a quarter of a percentage point from the current 4.75%, though a few say the bank could hold pat.

The pound soared last year as sharply higher U.K. interest rates relative to its industrial nation brethren put sterling in hot demand.



This story was supplied by MarketWatch. For further information see www.marketwatch.com.

Still trading cable short :)

chocolat,

I've been looking for a long entry all bloody evening, missed the one good opportunity, someone's got to get dinner..:-)
I am not good enough to short this, I feel.

Well there's only me to get dinner here Stormie - and there's 5 of us.

Makes a change...there are usually more :S

That may be so, but you know what you are doing, in both situations, makes a BIG difference....LOL

I was wrong, what a plonker :S
Long for now 17772

Forex - Euro surges to nearly two-month high against dollar - UPDATE 4
AFX


CHICAGO (AFX) - The euro was its richest against the dollar in nearly two months Wednesday as rosier European data have shifted focus to Continental growth and away from the solid U.S. performance.

Reports that Middle East oil proceeds are being redirected from U.S. dollars into euros, which follows Russia's announcement this week that it's shifting more of its central bank reserves to euros, fueled the sharp gains for the common currency, traders said.

But its ascent was also largely the result of the break of a key chart area. The euro had rammed $1.2250 several times this week only to be knocked back. That is, before Wednesday's successful charge took the shared currency as high as $1.2333.

The euro hasn't been above this level since it hit $1.2352 on June 7. It was more recently changing hands at $1.2329, a gain of more than 1% from where it stood late Tuesday.

The common currency did risk some pull back ahead of Friday's U.S. jobs report, which is seen showing a continued steady clip of payrolls additions.

For now, however, 'the latest batch of reports from Europe is confirming the market's view that the days of gloomy economic news from the Continent may be over,' said Boris Schlossberg, senior market analyst with Forex Capital Markets, New York.

The dollar's losses were aggravated by a softer-than-expected reading of the U.S. service economy, even though the report did little to sway expectations for continued dollar-supportive interest-rate increases from the Federal Reserve.

The Institute of Supply Management nonmanufacturing index slipped to 60.5% from 62.2% in June. The drop was more than expected.

The euro broke out of a trading range that had persisted for roughly the past three months.

'As the euro's 20-day moving average crosses above its 40-day moving average, traders witness this gradual but succinct change in trend, which could pave the way toward $1.25 by summer's end,' said Ashraf Laidi, chief currency analyst at MG Financial Group, New York.

'Although we see chances of $1.24 in the coming weeks, we expect the pair to end the month at $1.2350 as further Fed rate hikes will continue provide support for the greenback.'

Other currencies gained against the U.S. currency because of general dollar weakness.

The greenback was down 0.2% to 111.14 yen. The yen has fallen against a host of major currencies as political uncertainty persists.

Japanese Prime Minister Junichiro Koizumi's risks an interim election being called in the wake of his controversial postal reform bills, which will be voted on Friday.

The pound was up 0.5% to $1.7793 even as a growing number of central bank watchers think the Bank of England will trim its 4.75% target lending rate at Thursday's meeting.

The euro rally comes amid concern that recent positive data from the U.S. have failed to provide a further boost for the greenback.

But the economic landscape for the euro may be changing as well.

June retail sales in the euro zone rose 0.4% and a measure of the service-sector economy there, the PMI index, rose to 53.5 points in July from 53.1 in June.

Both figures came in above what had been forecast.

'A lower euro, which helped spur demand for the region's crucial export sector, along with recent political calm and stability after the early summer upheaval of the European Union constitution ratification process, have all served to change market sentiment toward the currency in the past few weeks,' Schlossberg said.

'But the other, perhaps more telling note, is that the foreign exchange market may have already started to discount the possibility of U.S. economic slowdown,' he said.

A report in London's Daily Telegraph said oil revenue is increasingly being spent in Europe, and rumors circulated of Saudi Arabian and Kuwaiti buying of euros.

That news follows an announcement earlier this week that the Russian central bank was moving to a 65%-35% dollar-euro mix for its reserves from 70%-30% previously.



This story was supplied by MarketWatch. For further information see www.marketwatch.com.

A bit of complacency set in today with the old shorting game - a quick rundown before I murder the dinner..

The next cable short target after yesterday's 1.7740/50s was 1.7780s, and if I hadn't been on the phone to someone when it shot up I'd have ploughed in, so when it pulled back briefly from 1.7784 I went long. The move up was too swift for it not to go through 1.78. Instead of applying the usual logic and shorting it once it ran out of steam because the MACDs said so, I took some off at 1.7825 and let the rest run with a view to adding if it could stay above 1.78. I gave up on that tack this afternoon and reversed at 1.7810 and closed it before I left work at 1.7773.

That's it then...back to shorting mode. I'm just not comfortable with longs at the moment :S

Choccy,

It's not a criticism ......... just an observation, so please don't take offence.

Why the fcuk are you trying to short something that wants to go up?

chocolat,

Thank you for the storyboard, it is good to see another's thinking...:-)
(Mind you, I get told off for thinking too much...lol )

ps, left work at 1.7773 eh......sneaking out early then, I'll tell the boss..:-)

Subtlety rules eh, Hils.
I traded cable long from below 1.73 until changing stance on Monday afternoon, since when I traded 5 shorts up to early this morning for 200 points, plus 80 odd from today. If I'd stayed long on Monday at 1.7710 I'd be about 80 points up as I write.

I like the way you qualify your observation, but I'm not sure what you're getting at?

Stormie - I was spotted :)
No worries though, I won't confuse anyone any more.

Choccie,

It was just an observation that cable has been well supported of late and is still rising. Every pip made on the short tack could probably have been 2 or 3 on the long tack. Maybe I'm too old for the stress, but I just don't see the point in trading against the trend.

Well done on your 200 pips.

Hils - I think the point I was trying to make on Monday was that I felt cable would struggle to break up out of the 1.77 level, and I wasn't afraid to say I was wrong yesterday, but when it failed to maintain 1.78 my conviction was renewed for now. All I've done is follow the chart to whatever level it takes me before I feel comfortable - so there's really no stress involved :)
My support line isn't as steep as the one you described the other day (although I can't find your post now) and I closed today's second short earlier as it bounced from 1.7741. It could be that my support line is still too steep, otherwise it looks like it was breached in the early hours yesterday and earlier this morning, looking at it in a candlesticky way.

Choccy,

I too have revised my rising support line. I now have a line connecting the 10am low from 29th July with the other more recent lows. Generally speaking, trends do not turn during Asian trade as appeared to be the case early yesterday morning.

I also agree that this current level is an obstacle as it provided support last autumn which turned into resistance last month. The hourlies are overbought and a retracement from here might well be on the cards. The daily oscillators, however, show it rising from an oversold position and bouncing from support on the multi-year uptrend. The bulls don't look ready to give up the fight just yet.

I'll be surprised if we don't see another 10 cents from here over the next few weeks.