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The EUR rallied for the first day for the last 4 days, adding 45 points to $1.4149 following an uneventful ECB s interest rate decision and disappointments in US economic data. Yesterday, as was widely expected, the ECB has decided to keep it key interest rate stable at 4% mainly on the basis of the ongoing housing crash and an increasing European pressure to limit economic growth in the EUR area. For the moment the ECB is waiting to witness whether the global financial-market confusion will slow economic enlargement before decide on the future course of interest key rates. credit pacific service union

In addition, yesterday The Bank of England decided also to keep interest key rates on hold at a six-year high of 5.75%. The reason for making this act is derived from the same concern which occupies the ECB, and mainly in order waits to see how a global credit crisis will affect the U.K. economy in the mid-term. Speculation that the monetary policy authority would cut interest rates had previously left the currency lower, but the BOE s inaction gave hope that rates would remain stable through coming announcements. credit first service union

Although there is no news expected today from European markets, today is expected to be quite a volatile day for the EUR as traders attention will be focused on the U.S Nonfarm Employment Change news. card credit mobile service

= Technical News EUR/USD

The pair is now floating around 1.4120 which is the 61.8% Fibonacci. A break beyond the level of 1.4150 will continue bullish move to the next level of 1.4250. If the pair will be shy of the break than a correction move will be imminent. GBP/USD The pair is in the midst of a correction move to the 2.0400 zone, after peaking at a record level of 2.0380. If the pair will break through the 2.0300 support level, than the correction move might be deeper. The 4 Hour chart indicates an moderate upwards momentum and once the overbought situation will unwind, the pair will probably continue. card credit discover service

USD/JPY

The negative momentum continues for the second day, as the pair is floating at the 116.50 level. The daily chart has no trend while the 4 Hour chart is showing a moderate bullish trend. USD/CHF After several attempts to break through the very important support level of 1.1700, the pair was a bit shy of that move and is now consolidating around 1.17 level. The ongoing momentum is down, as traders should pay close attention to the 1.1730 level, as if it is breached than a much deeper move would be imminent. credit public service union

Weekly Trend Down Down Up Up Up Down Resistance 1.4265 2.0520 118.30 1.1890 0.9130 0.7026 1.4230 2.0480 118.00 1.1850 0.9080 0.7000 1.4200 2.0450 117.50 1.1800 0.9050 0.6971 Support 1.4150 2.0360 116.80 1.1750 0.8980 0.6900 1.4100 2.0300 116.50 1.1700 0.8950 0.6870 1.4070 2.0243 116.00 1.1680 0.8910 0.6840 = Economic News USD Last week s much anticipated U.S Jobs Report didn t bring much relief for the greenback. The USD rose sharply on last Friday, after the Nonfarm Payrolls data showed September U.S. jobs growth of 110K. However, the initially strong rally of better-than-forecasted NFP figures turned into a similarly sharp sell-off for the USD. Since then, the greenback has stabilized and has been trading around the 1.41 level against the EUR. Last Friday s Average Hourly Earnings index released at 0.4% beating expectations of 0.3%. In fact, the latest string of the better-then-expected U.S data is reducing the probability of further possible Federal Reserve interest rate cuts. Now speculators forecast that the Fed will only cut rates by 25 basis points throughout December. card credit processing service

Also released yesterday, Personal Income rose 0.5% MoM and Personal Spending rose 0.7% MoM, inline with consensus estimates. The PCE core index, an inflationary measure closely watched by the Federal Reserve, remained unchanged at 2.2% YoY in December, but the MoM 0.1% reading fell short of market s expectations of 0.2%. Despite the importance of the data, no significant price action was detected upon the release, mainly due to the fact that these readings merely confirmed the recent trend suggested by economic indicators ; consumer spending rebounds while core inflation is gearing down. center credit service union

The major economic release of the month, the one all market participants are waiting for, is due out at 13:30 GMT today. The Non Farm Payrolls report, which measures the number of new jobs created in the previous month, excluding the farming industry, is expected to come out at 146K after a 167K reading the previous month. It is already several months that the labor market shows signs of recovery, and analysts expect this month to be no different. Although we are expecting a strong figure as well, we see a greater probability for the figure to miss expectations for the downside, printing around 120K-130K. If indeed we see a reading around these figures, and probably even around market consensus, we might see a knee-jerk USD sell-off all across the board. card credit service wireless

EUR

Euro zone manufacturing PMI fell short of market expectations of 56.2 and came out at 55.5. The German Purchasing Mangers index also failed to meet expectations, and printed 0.5 pts below the 59.0 consensus. The slightly disappointing figures did not manage to weaken the EUR much against the USD, but some weakness has been spotted against other counterparts. That weakness did not last long, as markets were anticipating some more valuable economic data to release from the US. At 10:00GMT this morning the EZ PPI (Producer Price Index) is due out and is widely expected to remain unchanged MoM and to rise 4.1% on a yearly basis. No significant price action is expected before the US NFP release at 13:30 GMT, when EUR direction will be determined in correspondence to the USD value. credit security service union

JPY

In a time where Japan s economic indicators provide little support for the woeful JPY, the currency draws its strength from some hawkish comments provided elsewhere. The currency continued strengthening yesterday on the back of comments by the US Treasury Secretary Paulson who once again triggered speculations that Japan could be criticized for their currency s weakness. The USDJPY dropped as low as 120.17 on the back of these speculations, but later rebounded back to 120.70. credit report service

Today s JPY price action will probably derive from external events as well, as the Japanese markets are already closed for the weekend. A strong US NFP report might send the JPY to down further, while an inline or below expectations report might very well send the JPY higher. blogspot com christian

= Technical News EUR/USD

After a very quiet overnight session, the pair is consolidating on the 1.3015 zone. Daily charts are very bullish with plenty of room to run, as the hourlies are starting to unwind and support the bias. 1.3000 appears to be a solid support. GBP/USD The pair is floating at 1.9660 which is the 0.382 Fibonacci of the 1.9260/1.9900 move. The daily charts are slightly bullish, as the hourlies support. Target price for today s session might be 1.9830. christian counseling credit

By looking at the intraday charts we can see that more bearish signals are built up. However, the 1.3200 support was pretty firm yesterday giving hope for those of you believes the uptrend is still in play. But if you are in favor of the recent bear formation, you should pay attention to break under 1.3200 with next target of 1.3130 next supports. credit federal service union

GBP/USD

The pair was unable to move any higher than the 1.9730 established yesterday, making it hard to determine whether we are facing up or down. The hourly indicators are mixed with some signals hinting sell positions have room to expand. Dailies shows beyond a shadow of doubt that we are still in a bullish trend USD/JPY It seems like the pair is the only one among the majors with a clear trend. We started the week around the 114.70 levels - almost 300 pips from where we are now. To verify the upward pattern, the support at 1.1670 must be held. Any failure might take as back into the famous range trading which characterize the pair. credit monitoring service

USD/CHF

As mentioned yesterday, the 1.2100 support is extremely important in order to stay with the current bearish tone. Yesterdays high came at 1.2085, making it easy to sell the failure (40 pips drop since then). In order to verify the down trend, a break under 1.1985 is necessary. = The Wild Card USD/CAD New high has established yesterday at 1.1572. Since September, we can see a nice clear, by the book, ascending pattern with constant highs and lows. Next minor test for the pair lies at 1.1615 with major one at 1.1750. credit division service

= Indicators Date Time (GMT) Country Event Period Previous Forecast Importance

14/12/06 09:30 GBP Retail Sales (MoM) Nov 0.9% 0.0% ** 14/12/06 09:30 GBP Retail Sales (YoY) Nov 3.9% 3.0% ** 14/12/06 13:30 USD Import Price Index (MoM) Nov -2.0% 0.0% *** 14/12/06 13:30 USD Import Price Index (YoY) Nov -0.2% N/A *** 14/12/06 23:50 JPY Tankan Large Manufacturers Index 4Q 24 25 ** card credit online service

Yesterday the JPY crosses continued to range trade as a result of high volatility in the Dow Jones Industrial Average thereby limiting trading activity. As a result of the strong relationship between carry trades and the Dow, traders completely ignored the Japanese Machinery Orders figure which released in negative territory at -4.5% and was much lower than the expected figure of 1.6%. This weak machinery orders figure was supposed to extend recent gains of the yen crosses yesterday but it had little effect as a result of Dow volatility and caution by traders ahead of the Bank of Japan interest rate announcement tomorrow. No rate hike is expected but since the current account surplus hit a record high and the CGPI inflation index rose 2.0% to 2.2% year-on-year we could see a strong GDP figure and hawkish comments from the BoJ Governor Fukui at the upcoming monetary policy meeting. consumer counseling credit inc

Today the JPY should trade in a tight range ahead of tomorrow s interest rate and GDP release which are expected to cause high volatility in the yen crosses. = Technical News EUR/USD Hourly charts on the rebound as the MACD crosses up back above the zero line and the target is set for the resistance at 1.3625. The RSI is scraping the overbought area and the Bollinger bands have widened significantly, 2 indicators pointing the way to further gains on the pair. card credit fleet service

GBP/USD

The MACD provided a buy signal on the 4H chart yesterday and now we see a contraction of the Bollinger bands. It could mean another breakout is looming - we suggest being aware of the upside potential. USD/JPY With all intraday indicators neutral and a 3 month high posing as a resistance, looks like we care heading into a day of consolidation. Look for more tests of the highs near 120.50 but for now, we don t see any room for extension. card consolidation credit

USD/CHF

The pair looks stable at current levels of 1.2144 but risk is toward the downside as opposed to other USD based currencies. Intraday indicators are neutral and volatility is low. Stay on the sidelines here. = The Wild Card CAD/CHF The pair is still close to its local high near 1.1100, trading near 1.1065 now. Forex traders will look for buying opportunities due to the RSI facing upwards and this despite the slight RSI divergence between the preceding high and now. Still, the market seems ripe for another high. credit free online report

= Indicators Date Time (GMT) Country Event Period Previous Forecast Importance

05/16/07 7:45 EUR French Non-Farm Payrolls q/q 0.2% 0.3% * 05/16/07 9:30 GBP Claimant Count Change m/m -9.2k -5.5k * 05/16/07 9:30 GBP Avg Earning q/y 4.6% 4.8% * 05/16/07 9:30 GBP Unemployment Rate m/m 4.6% 4.8% *** 05/16/07 10:00 EUR EURO CPI m/m 0.7% 0.5% **** 05/16/07 10:30 GBP BOE Inflation Report **** credit federal first service

However, the beleaguered dollar found no reprieve in the overnight session, dropping to fresh 18-year lows versus the Aussie at 0.8847 and falling to a new 26-year low against the sterling at 2.0640. Traders will closely assess this week s US economic reports to determine the trend direction for the greenback over the coming months - with overwhelming sentiment biased toward further declines as a result of expectations for global interest rate differentials. consumer credit service

The economic calendar for the USD today is light, consisting of only the July Richmond Fed manufacturing survey - seen improving to 5, up from 4 in the previous month. Traders will also continue to analyze earnings releases and monitor US equity performance. There are also Fed officials scheduled to speak, including Mishkin and Poole. center credit family service

Equities, bond yields, and the US dollar all recovered yesterday amidst the lack of any US economic data. However, none of these assets managed to regain all of Friday s losses, which suggests that the selling may not be over. This week s major event risks do not come until Wednesday at which time we will learn more about how much the situation in the housing market has worsened (major affect on the US economy). If existing and new home sales continue to fall, then Fed Chairman Bernanke might claim that things will worsen before they will get better. However if they rebound the market will continue to downplay the risks of a collapse in the housing market. credit reporting service

We don t expect the US government to stand in the way of further dollar weakness, however it seems that they are still feeling comfortable with the low greenback especially when it s supporting the wide export sector which will try to leverage the recovery to other territories. In actuality, the manufacturing sector is recovering strongly thanks to booming exports. This is one of the primary reasons why the housing market has not collapsed yet and why the stock market remains not far from its record highs; all due to the widespread benefits of a weak dollar. cca credit division service

The question that will be continuously asked is when the USD recovery will take place Well, optimism is increasing which has translated into stronger capital spending and productivity shall offer that the recovery is in sight . credit free report service

We think that EUR/USD is more likely to reach 1.3900 in the upcoming weeks as opposed to a significant reversal. EUR This morning, the EUR trades just beneath its all-time high against the dollar, hovering near 1.3820. Today, economic data from the Eurozone includes the May current account balance, July service and manufacturing PMI, and May industrial orders. The May current account deficit is forecasted to weaken to 1.2 billion euros in May compared to the 4.0 billion euros a month earlier. The July services PMI is estimated to slip to 58 from 58.3, while manufacturing PMI is seen falling to 55.5 versus 55.6. Lastly, industrial orders for May are forecasted to reverse the previous month s 0.4% decline, rising by 1.1%, but slip to 7.8% versus 12.2% from a year prior. card credit customer discover

Yesterday, the Euro climbed to a new record high in the early Asian trading session, but failed to hold onto its gains. This type of price action should be worrisome for EUR bulls, however we would need to see a close below 1.3780 to turn bearish which is unlikely. credit repair report service

This is the last chance that we will hear from ECB officials before they go on their summer holidays and the lack of concern over the past few weeks implies that they fully intend to raise interest rates to 4.25% over the next few months. credit legal repair service

Yesterday, the ECB member Papademos pointed out that some EZ countries have raised their growth rates while Stark talked about how the current level of the EUR reflects the strength of the Euro zone economy. cic credit monitoring service

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