Forex Policy
Mid-Week USD Forex Outlook Negative sentiment
January 12 (Global-View) Heading in the mid-week period, the dollar is looking decidedly heavy. EURUSD seems that fund last week in the back of poor employment data than expected. Now, the USD / JPY has unexpectedly turned to the south, even after new finance minister, Khan seemed to signal that a 95.00 level in the pair is the official of Japan would like to see.
We the wishes of Japanese officials in forex seriously because they usually get what they want over time. They have considerable financial resources at their disposal to things happen. Japan also usually tends to favor a weak currency policy to help exporters, such as the automotive industry to do well. We heard that the foreign exchange industry target levels for the rate of the Japanese automakers are USDJPY 95-105. Current of Currency Trading conditions are difficult with the USDJPY down decisively, while our fundamental side expects the yen to weaken. In this environment, we like the idea of stepping down until technicians and comply with the foundations for this currency pair.
This is not a week marked by a lot of news fundamental side. This suggests two things: (1) technicians are in control and (2) traders tend to return to the capital to USD (dollar negative) trade, it works, not because it makes sense.
We have recently observed that the momentum traders had been moving in time EURUSD trade. With traders USD momentum now short, looking for news and / or price action to support their positions. The markets have been influenced by the softer than expected U.S. jobs January data released Friday, but the news is starting to get a bit stale now. The next block of key data this week seems to be sales retailers and weekly jobless figures on Thursday. St. Louis Fed Governor Bullard reinforced yesterday that U.S. rates could remain low for a long period of time. Thus, the USD has lost its interest rate support for now. The yield of two years, which is a useful predictor of Fed policy in the short term for the next 24 months, fell again today to 0.91%,-2bps. bond spreads to two years are good leading indicators of future developments in the exchange rate.
Today sees the key figure in trade data releases from U.S. and Canada. Check the forum for exchange for up to date market developments and business ideas. See also economic calendar for upcoming events in the currency market.
About the Author
John M. Bland has been involved in the Forex Market for more than 30 years . He is a co-founder of global-view.com, the leading forex discussion site and home of the original forex forum. global-view is a place where forex traders come for trading ideas, the latest rumor , breaking news and forex trading flows.
Forex Trading- Cowabunga System
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