Forex Club Analysis
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18/04/2012
Technical Update - Stuck in RangesThe majors have settled in volatility with the lack of a crisis to focus on, and pairs such as the EUR/USD, AUD/USD and USD/CHF have given traders no trends to focus on. Instead they've seemingly chopped without any apparent order.
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13/04/2012
Large Traders Increase Bearish Bets on EUR/USDToday's Commitment of Traders report was released by the CFTC and shows that on April 10, 2012, hedge funds and CTAs raised their short position on EUR/USD futures to 101,364 contracts, or 12.67 billion Euros.Source: FX Club Research and Bloomberg. Click the chart for full size.
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05/04/2012
Stepping Back to the Long TermThe rally in USD after FOMC minutes caught many traders off guard and it was largely seen as a step back by the Fed from additional easing.
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30/03/2012
Clear Bearishness Emerging in USD/CHFOur view is that the Swiss Franc is one of the best currencies to strengthen against a weak US Dollar. One reason for this dynamic is a sort of hedge against global tail-risk in the form of Euro-Zone sovereign crises but the Franc is also similar to gold in that it is a safe-haven hedge, and the gold trade is not doing too bad despite a setback in March.Click for full size.
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30/03/2012
Quarter End Expected to Bring Some VolatilityToday brings the end to the month and the first quarter of 2012. Options expiries and managed money accounts are likely to square up large positions for technical reason and some volatility is always to be expected.The volume distribution below is clearer to us that the trend up in EUR/USD should culminate in 1.3455. On the downside stops are plentiful in the 1.3295 region.Click for full size.
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29/03/2012
Key Intraday Analysis - March 29, 2012Risk is recovering late in the US session as a pattern develops where risk sells off in while the European markets are still open, and then recovers when they close.
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13/03/2012
Technical Update - Daily Forex Charts with Volume ProfileWith the sea change in markets of stocks going up and risky currencies (such as Euro and Aussie) going down, we are refocusing our bias on a positive outlook for the US Dollar. Usually we see risky currencies correlate with stocks but now that the US economy is recovering and the Greek default is history, the Euro can resume it's downtrend on negative economic fundamentals in Europe.Daily EUR/USD chart with volume profile. Source: FX Club Research and Bloomberg
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06/03/2012
Technical Update - Intraday Forex Volume ProfileAfter the sell of in virtually all assets, our mentioned price targets have been acheived and we're re-entering familiar territory from the beggining of this year in January, when the Greek bailout headlines just began stoking the market higher.As the entire move up in Euro has been erased, it's hard to see now how a sustained rally can take place as investors re-evaluate the effects of a bailout, and hunker down for a default.30-minute intraday EUR/USD chart and volume profileSource: FX Club Research and Bloomberg
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22/02/2012
Euro and Stocks Aren't Historically CorrelatedTraders have almost gotten lazy these days when gauging the forex market because it is so highly correlated to global equity markets. In a typical day, we usually observe lock-step movement in the S&P 500 and EUR/USD. The corellation is even more exagerated when we're at the mercy of a news release or crisis event.The correlation doesn't just stop at equity markets, the US Treausury market is inversley correlated (in terms of prices of bonds, not yields), and so is the US Dollar. Commodities also exhibit positive correlation to stocks.Such close movements across markets haven't always been the norm. In fact, the cause of correlating markets is from a crisis-mentality among investors. When the US housing market was crashing, and Greek sovereign debt threw a wrench into the global recovery, investors switched into a mode of capital preservation (instead of looking for ways of appreciating their capital).
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16/02/2012
Another Weekend of TradingThe weekend is once again lined up to be a dramatic one as we sit on pins and needles for a bailout of Greece on February 20th. The expected gap in EUR/USD is likely to begin forming at some early part of Sunday, perhaps 15:00 EST or even earlier. Therefore, Friday is likely to be your typical winding down of risk day where traders dump anything that might be affected by a Eurogroup decision.The Aussie chart below shows our technical outlook on an intraday scale. Source: Bloomberg
