FOREX NEWS | CURRENCY NEWS BY FOREXLIVE

GBP/USD Furthers Freefall to Hit Downside Target

5/24/2012 – Price action on GBP/USD (a daily chart of which is shown), as of 5/24/2012, has reached its downside target around the 1.5640 price region, which is also the 61.8% Fibonacci retracement of the latest uptrend run from mid-January to late-April. Therefore, price is currently at a critical juncture.

Having dropped down to hit the key 61.8% retracement level after having spent the entire month of May thus far in essentially a freefall that broke down below a large and significant wedge pattern, the pair currently continues to experience exceptionally bearish momentum.

In the event of continued bearish momentum, which would be confirmed by a further breakdown that breaches the current 1.5640 price region, the next major downside target resides around the important 1.5500 support region.

Upside resistance on any rebound currently resides around the 1.5750 price region.

(Chart courtesy of FXDD – Metatrader. Uptrend lines in green, downtrend lines in red, horizontal support/resistance lines in black, Fibonacci retracements in purple, 200-period simple moving average in blue, 100-period simple moving average in brown.)

Japan April Nationwide core CPI +0.2% YoY

EUR/CHF playing ‘silly buggers’ overnight

EUR/CHF gapped sharply higher overnight from 1.2010 to 1.2075, triggering large hedge fund stops above 1.2025 and again above 1.2050. There were 3 possible explanations:

• ‘Fresh’ news that the SNB was preparing to tax CHF deposits; but fresh news turned out to be only a regurgitation of old news
• Active SNB intervention; also complete rubbish. As we reported earlier in the week, a Dutch Prime Broker is bidding at 1.2010 during European and NY trade on behalf of the SNB and the SNB itself is sitting at 1.2000.
• ‘Fat fingers’; also no evidence whatsoever that some fat finger managed to buy EUR5 billion to move the pair!!

My advice has remained the same for the last 6 months, avoid this pair and look elsewhere for opportunities.

REBROADCAST. The Traders Course with Greg Michalowski

Topic: Anticipating the Trends
Traders (like athletes/like businesses) need to anticipate to be successful. Anticipating a trend is an even better. I will start a mini series today by looking at this idea and explain how you can start to anticipate more trend moves in your trading.

To watch the REBROADCAST, click on the following link: https://www1.gotomeeting.com/register/945707617

See you there.

Citibank Global Economic Outlook and Strategy

Greece will leave EMU on 1 January 2013. We believe the ECB will be willing to provide liquidity support for Greek banks (to replace lost deposits) until the June 17 election, either directly or via the expansion of Greece’s ELA. But, we assume that the election will not produce a viable government that can follow the Troika plan, leading to a stalemate between the Greek government and official creditors, and to the suspension of EFSF/IMF funding

These quotes weighed heavily on the EUR in overnight trade.

Italian PM Monti: Germany can be persuaded on Euro bonds

More from Bloomberg

EUR/USD: Barriers at 1.2500 should provide some support

On the plus side for the embattled EUR, there are the ubiquitous barriers to provide occasional breaks on the way down. Not sure on size but bigger barriers are reported at 1.2450.

EUR/NZD flows: Real money sellers over last 48 hours

This is not a pair that I pay much attention to, though perhaps I should change that after a 300 pip fall in the last 48 hours. Real money sellers are reportedly behind the move but the NZD did have a very ‘oversold’ feel to it anyway, and it’s perhaps just reverting to more median levels.

EUR/AUD: Big stop-loss orders reported below the market

EUR/AUD is currently sitting on a very solid trendline support, coming in around 1.2820 according to my line drawing. Little surprise then to hear that there are some big stop-loss sell orders lined up below 1.2800, 1.2770 and 1.2750.

Trade Idea Central, Friday May 25th

If you’d like to share your trading ideas with others, or update existing strategies, then please do so in this thread.