| Forex Weekly Outlook – September 6-10 Posted: 04 Sep 2010 01:00 AM PDT 
The upcoming week features less US figures after the Non-Farm Payrolls. Rate decisions in Japan, Australia, Canada and Britain are the highlights. Here’s an outlook for the major market moving events. Monday is Labor Day in the US and Canada. The markets will be more quiet than usual, but Friday’s Non-Farm Payrolls will still echo in the markets. - Japanese rate decision: Published on Tuesday, early morning. The recent BOJ meeting, that was an emergency meeting, failed to bring a big change, especially no coordinated intervention. Also in this decision, intervention to weaken the yen will be closely watched. This already became a heated political issue in Japan, as Ozawa, a candidate for Japan’s No.1 position pressures Premier Kan to do something. There’s no chance of a rate hike of course.
- Australian rate decision: Published on Tuesday at 4:30 GMT. After six rate hikes, the RBA left the Cash Rate unchanged at 4.50% for many months after the higher rate managed to cool the housing sector. With the economy picking up strongly once again, there’s a small chance of a hike to 4.75%, but the consensus stands on another month of pause. It’s important to watch the accompanying rate statement for clues about the next decision.
- Canadian rate decision: Published on Wednesday at 13:00 GMT. In this case, it’s quite unclear whether Mark Carney and co. will hike the rate for a third time to 1% or leave it unchanged. The second rate hike was accompanied by lower expectations for Canada. It seems that the slowdown of the US, Canada’s main partner, has already cooled Canadian prices and the bank can pause now, but other figures point to a hike. So, any decision will rock the loonie.
- US Beige Book: Published on Wednesday at 18:00. This important collection of economic data is part of what the Federal Reserve sees before making its decision, that will be made two weeks later. Following the groundbreaking decision to renew the bond buying scheme and the statement that the economy slowed down more than expected, it will be interesting to see what awaits the Federal Reserve now.
- Australian employment data: Published on Thursday at 1:30 GMT. After many months of super strong figures, last month’s employment figures were somewhat mixed in Australia. Employment Change rose by 23.5K, slightly better than expected, but the unemployment rate rose to 5.3%, which was a disappointment. A similar gain in jobs, 25.3K is expected now. The unemployment is expected to fall back down to 5.2%.
- British rate decision: Published on Thursday at 11:00 GMT. There’s still only member of the British MPC that wants a rate hike – Andrew Sentance. This came in response to the rising inflation, which has weakened in the meantime, as Mervyn King had expected. So, the chances of a rate hike are lower now. The British Official Bank ate will probably stay at 0.50% once again. The wording of the MPC Rate Statement will be interesting to watch.
- US Unemployment Claims: Published on Thursday at 12:30 GMT. As always, this weekly release of sensitive job data always rocks the markets. It’s the first release after the Non-Farm Payrolls. Following last week’s slide to 472K, another small slide is expected now, to 470K.
- US and Canadian Trade Balance: Published on Thursday at 12:30 GMT. This double-feature release always rocks USD/CAD. Canada’s deficit unexpectedly grew to over 1 billion last month, getting further away from a surplus Canada enjoyed for quite some time. The US deficit also disappointed by growing to almost 50 billion. Both deficits are expected to squeeze.
- Canadian employment data: Published on Friday at 11:00 GMT. After three superb months of big gains in jobs, last month saw a correction with a loss of 9300 jobs and a rise of the unemployment rate back to the round number of 8%. While the rate isn’t expected to move, a nice gain of 17.6K will probably be seen now, helping the loonie.
That’s it for the major events this week. Stay tuned for coverages on specific currencies. Further reading: Want to see what other traders are doing in real accounts? Check out Currensee. It's free.. |
| Forex Articles for the Weekend – September 4 Posted: 03 Sep 2010 02:00 PM PDT 
As the dust from the Non-Farm Payrolls sets, it’s time to sit back and relax on some long-term forex-related articles for this long weekend. Here are my picks from the web. It was a very busy week indeed. Apart from a packed calendar and the Non-Farm Payrolls, the Bank of International Settlements officially released its triennial survey stating that forex trading reached a daily volume of 4 trillion dollars. I’ve reported this almost a month ago, and now it’s official. And if this wasn’t enough, the new 50:1 leverage CFTC rules were presented and created lots of discussions on the web. This is a significant change to the American (and also global) forex industry. Here are interesting reactions on both stories and more: - Katie Martin, on WSJ, doubts the notion of a “new brave world in currencies” following the news about the BIS triennial survey..
- Adam Kritzer analyzes this official release and sees an increase in emerging / exotic currencies.
- Michael Greenberg reports that FXCM is worried that the new CFTC rules will prevent US traders from having foreign accounts. Will they classify foreign brokers with the same code that is used for gambling?
- Bart Mallon looks at the next step regarding the new rules – the role of the NFA in registering brokers and placing requirements.
- Francesc Riverola reminds us that the “Forex Trader of the Year” contest of real accounts begins on Monday. You can still sign up.
- Kathy Lien provides “the best reason” to buy Euros.
- Andriy has an open poll asking where the Euro will end 2010.
- Macro Man summarizes the summer and sees that the collective wisdom of his readers was accurate about EUR/USD and most other indices.
- Sophia Todorova, on Casey’s site, deals with an issue that many traders fall upon – self sabotaging.
That’s it for now. Some of you have a really long Labor Day weekend. Have a great one! Want to see what other traders are doing in real accounts? Check out Currensee. It's free.. |
| Non-Farm Payrolls Finally Great – No Double Dip? Posted: 03 Sep 2010 05:32 AM PDT 
Non-Farm Payrolls exceeded expectations and fell by only 54K, nearly half of early expectations. The unemployment rate rose from 9.5% to 9.6% as expected. The initial reaction was a drop of EUR/USD but it immediately rose back up. USD/JPY is going in one direction – up. The important part of the release was the the private sector figure. Here, a gain of 67,00 was published, also significantly better than 40,000 that was predicted. And there was more good news: A revision of July’s figure showed that Non-Farm Payrolls fell by only 54K instead of 131K initially reported. Also the private sector’s number was revised in July from 71K to 107K. All the numbers are significantly better than expected. EUR/USD traded around 1.2840 before the release. It then fell to 1.2810, leaped to 1.2875 and fell back again. It’s currently looking for a direction. We could see a relief rally on EUR/USD and stocks. The Japanese yen, that has a low yield and is also a “safe haven” currency fell sharply. USD/JPY jumped from 84.40 to 85.20 after the release – no choppy trading – just one direction – up, according to scenario #2 in the Non-Farm Payrolls preview. As written in the preview, this publication of Non-Farm Payrolls is a test for the fears of a double-dip recession. Did this calm the markets? As always, analysts will debate over this for some time. A recovery in jobs is the key to recovery. Want to see what other traders are doing in real accounts? Check out Currensee. It's free.. |
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