The Advisor Weblog

Beginners Corner Webinar at 17:00 GMT
NFP mixed, dollar spikes down
USD/JPY may resume bearish trend
Canadian Payrolls
EUR/USD: Watch for 1.4400
Starting the day

Posted: 06 May 2011 08:50 AM PDT

Hey! today I'm going to be again with the Beginners Corner's Webinars and we are going to talk a bit about charts, what you may already know, with an extra surprise that I hope everyone will find pretty interesting.

Join me here:

http://www.fxstreet.com/webinars/sessions/session.aspx?id=59843881-2f1f-403b-8d28-2324dbe3ff82

NFP mixed, dollar spikes down

Posted: 06 May 2011 05:30 AM PDT

US NFP come out mixed as unemployment rate rose back to 9.0% yet the economy managed to add 244K new jobs, well above previous month and expectations. Stocks jumped strongly to the upside, commodities also start to gain some ground, and safe havens dollar, yen and swissy are down.

Euro and Pound are hovering around pre report levels with no much direction now: as usual, EUR/USD and GBP/USD doubt either to follow dollar or sentiment following this report.

Expect AUD/USD, USD/CHF and USD/JPY to continue rising if momentum holds after this first spike.

USD/JPY may resume bearish trend

Posted: 06 May 2011 04:57 AM PDT

USD/JPY seems willing to resume it's bearish trend according to the 4 hours chart:

You can take a look at the technical details here:

http://www.fxstreet.com/technical/forex-strategy/the-best-pair-to-trade-now/2011/05/06/

This posting includes an audio/video/photo media file: Download Now

Canadian Payrolls

Posted: 06 May 2011 04:05 AM PDT

Employment data in Canada come out much better than expected, with the economy creating over 58.3K new jobs against -1.5K lost previous month, while unemployment rate decreased from 7.7% to 7.6%. Positive news sent USD/CAD to test 0.9600 yet reaction has been pretty much limited.

US payrolls tend to come in line with Canadian ones, maybe the US will surprise with a positive number also.

EUR/USD: Watch for 1.4400

Posted: 06 May 2011 02:39 AM PDT

How we determinate if EUR/USD has already set an interim top at 1.4940, and is ready for a trend change, or this slide is just a deep correction? Never easy of course. Considering the fundamental side, the euro zone maybe slightly better than the US, but sovereign debt is still a pending matter. Rates differentials of course, favor Euro, while ruling risk aversion favors the greenback.

Looking at this daily chart, we see indicators easing extreme overbought readings, momentum heading lower yet still above 100, current candle finding resistance at the 20 SMA, all suggesting further downside pressure. A daily ascendant trend line, coming from January 10th low at 1.2874, lies today at 1.4400; so if the pair manages to break that level, 1.4250 comes at sight. Bounce at the line, needs to recover above 1.4580 area, to erase the bearish tone and may see the pair resume its bullish trend.

For today, short term supports are at 1.4490, 1.4445 and 1.4400 area, while resistances come at 1.4580, 1.4620 and 1.4660.

This posting includes an audio/video/photo media file: Download Now

Starting the day

Posted: 06 May 2011 02:00 AM PDT

Hi all and welcome back! Against major expectations, ECB President Trichet let markets know a new rate hike will have to wait at least till June. Given the strong slide in stocks and commodities seen since early week, Euro buyers gave up, and triggered a massive sell off, with EUR/USD down near 360 pips this Thursday. Dollar got buoyed across the board, with all major currencies giving up ground, even CHF.

Japanese yen on contrary, rose to 79.55 before pulling back above 80.00 against the greenback.
Indeed, I was not expecting a dovish Trichet, or better said a "non-hawkish" one. I guess no one was, that's why the reaction was so strong. As we always discuss, fundamentals can't affect market, unless they shock them.

Still, today the US will publish NFP; as per minor reports seen these last few weeks, number could come worse than the 185K expected, meaning also worse than previous one at 216K. Commodities slide continues, yet stocks are aiming for a recovery, so what would it be? If we have a bad number, will stocks fall and dollar and yen gain? Or will dollar extend yesterday's gain? And if positive? Could Euro regain the upside, and leave recent slide as a strong correction in the middle of its bullish trend? Honestly, I can´t tell. What I can tell, is that I will be looking for entry points either side of the market, and will wait till news are digested to take a trade.

Here is the link for today's calendar:

http://www.fxstreet.com/fundamental/economic-calendar/

Have a great day!