12 hours ago | October 24th, 2014 20:37:49 GMT

ForexLive Americas wrap: Leaks sink ECB stress test drama


Forex news for October 24, 2014:

One of the reasons Europe is sinking is that it has so many leaks. Nothing is kept secret in Europe and there’s now very little drama left in the stress test results after the major newswires obtained draft copies. It looks like 25 banks were asked to raise money and only 10 of 190 are on the naughty list.

No great trading theme developed in the FX market in US trading although stocks remained bubbly and that helped the US dollar but only mildly.

Ebola fears greatly dissipated and until there are signs about a genuine uncontrolled outbreak, I don’t think the market will flinch too hard on headlines any longer.

USD/JPY took a quick trip down to 107.78 early in US trading as stops were run on jitters but it bounced back quickly and we finish midway through the daily range at 108.13.

The Australian dollar put a bit of a squeeze on shorts early in US trading as the broad commodity complex did better. But the shine came off later in the day and AUDUSD drifted to 0.8797 from 0.8824.

Canadian dollar sellers are clearly lurking in the weeds and for the fourth consecutive day and test of 1.1200 in USD/CAD was rejected and the pair climbed back to 1.1239.

FX ticker

Have a great weekend!


13 hours ago | October 24th, 2014 19:40:43 GMT

CFTC Commitments of Traders: Yen shorts squeezed


Forex futures market speculative positioning data from the CFTC Commitments of Traders report as of the close on Tuesday October 21, 2014:

  • EUR net short 159K vs short 155K prior
  • JPY net short 72K vs 101K short prior
  • GBP net short 4K vs short 3K prior
  • AUD net short 32K vs short  30K prior
  • CAD net short 22K vs short 16K prior
  • CHF net short 18K vs short 17K prior
  • NZD net short 2k vs short 2k prior

Not much change, right across the board except in yen crosses. Looks like USD/JPY longs rushed to the sidelines last week and early this week on the rout in risk. I think what we started to see on Thursday was them rushing back in. The -72K leaves plenty of room for fresh shorts to push USD/JPY back 1.10.

Yen positioning

Yen positioning

Yen net at the least extreme since July, when USD/JPY was at 101.50.

This is a good buying signal if you were already thinking about USD/JPY longs.


14 hours ago | October 24th, 2014 18:49:10 GMT

Look to sell the euro near 1.30 – JPMorgan


From JPMorgan:

No clarification yet in EUR/USD as key-support at 1.2605/1.2592 (pivot/minor 76.4 %) has not even been scratched yet, which however also applies for the now relevant resistance cluster at 1.2697/1.2706 (minor 38.2 %/pivot), notes JP Morgan.

“Only a breakout of this range would now provide an early indication whether we can expect another corrective leg up (wave c) towards the upper T-junction at 1.2959 (int. 38.2 %) or the straight resumption of the broader downtrend next,” JPM adds.

“Towards 1.2959 though, we’d see a very good risk reward given to re-establish a strategic short position,” JPM advises.

JPMorgan likes selling near here

JPMorgan likes selling near here

Same goes for cable, according to JPM, where the range trading affair goes on without giving us the final hint yet whether another up-swing might be missing or whether the broader downtrend has already been resumed.

“That said we need a range breakout between 1.5948/44 (minor 76.4 %/pivot) or a break above hourly neckline resistance (currently at 1.6170) to receive an early indication whether we are heading towards 1.6525/33 (pivot/int. 50 %) or for a test and possible break below key-pivotal support between 1.5852 and 1.5752 next,” JPM argues.

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15 hours ago | October 24th, 2014 17:59:17 GMT

For forex traders, this is the most confusing time of year


It’s that time of year again when clocks start to change.

Trying to keep track of what time it is in London, Paris, New York, Tokyo and Sydney is a head-scratcher at the best of times but it finally starts to feel a bit easier after 5 months of stability.

No more. The confusion has started already. Ryan posted about how Mike will get less light and less sleep in the morning but it’s actually the opposite but it means the trip home from work will be in the dark.

If we could all switch clocks together (or not) it would be an easy exercise but there’s a one-week lag between Europe and North America.

Europeans turn their clocks back early Sunday morning and then  North America does the same on Nov 2 (except Arizona and Saskatchewan).

Meanwhile, most of Australia doesn’t change the clocks but our beloved Eamonn is in Melborne where they do. Thankfully that was already dealt with early in the month (New Zealand as well). Of course, they move the clocks in the opposite direction.

For traders in the UK or New York, the bottom line is that the difference will be 4 hours — for a week. It means all the economic releases will feel like they’re coming out at odd times. For the next week, lots of eyes will be on our clocks at the top of the page.


15 hours ago | October 24th, 2014 17:24:21 GMT

USD/JPY slips back below 108.00 on pre-weekend profit taking


The correlation is tight with stocks late in the week.

Some profit taking is hitting the S&P 500 after a banner week that included at 3.7% rally anyone who was long risk trades will be taking some off the table for some weekend champagne.

The earlier session low in USD/JPY was a spike down to 107.78, I don’t expect that to break.

Global stock market changes

Global stock market changes


16 hours ago | October 24th, 2014 17:04:32 GMT

New York Ebola patient had no temperature elevation before Thursday morning


The New York ebola patient didn’t have an elevated temperature before 10-11 am ET on Thursday, according to the NYC health commissioner.

The patient (who is a doctor) is being roasted because he went out bowling and took the subway on Wednesday night. If he didn’t have symptoms the viral load would have been extremely low when he was out and it’s highly unlikely the disease will be transmitted.

Then again, he could be lying about the fever to save face.

The NYC health commissioner is also saying there’s no reason to close off his apartment building except his residence. How would everyone feel about living in that building right now?


16 hours ago | October 24th, 2014 16:33:55 GMT

AUD/JPY was the best performing trade this week


The Australian dollar was the top-performing currency in the past week while the yen lagged.

FX changes versus USD percentage changes

The Australian dollar has gained against the yen for six consecutive days and technically, there isn’t much in the way over the October highs near 96.00.

The weekly chart looks like it could be in the midst of a massive turnaround, similar to many of the main stock indexes.

AUDJPY weekly chart

AUDJPY weekly chart


17 hours ago | October 24th, 2014 16:11:34 GMT

Forex Trading: GBPUSD neutral week but found support at 1.6000


UK GDP came in as expected today. The news was a relief to GBPUSD after more dovish BOE Meeting Minutes and weaker Retail Sale on Wednesday and Thursday. The data release created a volatile period in the first hour after the report, but since then the price has rebounded and is trading by a cluster of technical levels as London traders exit for the weekend.

For the week,

  • The price closed last week at 1.6085.
  • The high reached 1.61829
  • The low reached 1.59916
  • The midpoint is at 1.6088
  • The 100 hour MA is at 1.6085

The current price is within 5 or so pips of the 100 hour MA, the close from last week the 50% of the weeks trading range.  Right in the middle. If you look at the weekly chart, the 100 week MA is at 1.6093 .  So that too is around the current level.  It’s like kissing your sister in that respect but there is one more bullish signal.  That comes from the weekly chart.

GBPUSD ending London week near the close from last week, the week midpoint and the 100 hour MA.

GBPUSD ending London week near the close from last week, the week midpoint and the 100 hour MA.

The low for the week fell below the 50% of the GBPUSD move up from the 2013 low to the 2014 high at the 1.6000. Although the price fell below the 1.6000 level, there were no closes below the level.  The price of the GBPUSD has traded above and below these levels in the last 4 trading weeks.The fact the price just barely made it below might be a little more bullish bias.  Buyers held that line.

Of course, the pair was only a 0.6% reading in GDP today from the pair ending the week on a more bearish technical bias, and next week the bulls will still have to prove that the price can sustain a rally, but for now and from what happened today, the action is more positive in what has been a “kiss your sister” type of week.

GBPUSD traded above and below the 50% and 200 week moving average for the 4th week in a row.

GBPUSD traded above and below the 50% and 200 week moving average for the 4th week in a row.


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