Risk aversion and the Fed’s announcement of further quantitative easing have pushed USD/JPY down through support to the lowest level in 15 years. Japanese officials expressed concerns in the Asia-Pacific session about the rising yen but that has done nothing to slow the rally. Japanese Finance Minister Noda told reporters in Tokyo that recent moves in the yen have been “a little bit one-sided.” Meanwhile, Japanese Trade Minister Masayuki Naoshima said that deciding on FX interventions is difficult in an interview with Jiji Press. USD/JPY fell as low as 84.73 but was most recently down 47 pips to 84.97. The pair fell as low as 84.83 in November 2009 during the height of the credit crisis but USD/JPY hasn’t traded below since 1995. If the pair can close below 84.83, it will be an extremely bearish signal.

A reason for the weakness in USD/JPY is that U.S. growth in the second quarter may have been far worse than the 2.4% pace that was initially estimated by the Bureau of Economic Analysis. Two surveys private economists show they are expecting more than a full point of revisions. Bloomberg has just released a survey suggesting growth will be revised to 1.2% but it’s based on just four responses. Similarly, Dow Jones has a listed consensus at +1.3% (it’s unclear how many were surveyed). After four quarters of contraction, the U.S. economy grew at a pace of 1.6% in Q4 2009 followed by quarterly readings of 5.0%, 3.7% and the most-recent 2.4% rate. It appears that growth is stalling as government stimulus fades. With momentum clearly slowing, more questions will arise about the possibility of negative growth and recession. Slower-than-expected inventory builds are a large part of the downgrade. Today’s unexpectedly large U.S. trade deficit for June will also hurt. One notable market watcher is saying today that growth could be revised to as low as +0.5%.

We expect a bounce in USD/JPY in the immediate term but will be looking to sell. We will also sell on a close below 84.83 with an eventual taget of the all-time low at 79.90.

The strongest trend in the forex market at the moment is a falling USD and rising JPY. USD/JPY has been declining for nearly 11 weeks. This will be a big week in terms of U.S. data and there is talk that Japanese officials may intervene in the market is USD/JPY falls to 85.00. Watch for U.S. data on consumer confidence, durable goods, the beige book, GDP and the Chicago PMI. If the outlook continues to darken for the U.S. economy, look for this pair to continue sliding.

U.S. Federal Reserve Chairman Ben Bernanke roiled markets last week when he uttered that “the economic outlook remains unusually uncertain.” Markets take their cues from the Fed. Remember it was Bernanke’s comment in April 2009 about “green shoots” that helped prompt a huge turnaround in financial sentiment. Many traders stand by the old adage “don’t fight the Fed.” What Bernanke’s comment meant was that they are in data-watch mode, unsure of which direction the U.S. economy is headed. “We will continue to carefully assess ongoing financial and economic developments,” he said. His comments have focused the market’s attention on incoming U.S. economic data. As a result, the U.S. dollar is moving more than usual after economic data releases. We are seeing solid rallies against the yen on stronger economic data and deep slumps on soft figures. An “unusually uncertain” market is prone to big moves whenever there is a hint of clarity. Keep an eye out for signs that make the outlook more certain, for better or for worse.

What a market we are experiencing today!!!  It spells money!!!

As we can see from the trading day yesterday the oil continued its movement in the direction of an uptrend reaching the price of $75.38 a barrel. This was a 10 month high for oil after the amazing summer of 2008 when oil reached $140 a barrel.  This direction continues to support the weakening of the USD, while supporting the CAD and AUD, the commodity driven currencies.

When will this trend stop??

Maybe a few traders have an idea when this will end, however when we look at technical analysis we continue to clearly see the trend.  The announcements we mentioned above coming from the US have already been published and both were positive for the USD. Will we see a market correction or will the trend continue? Question left unanswered will be answered by the traders during the end of the London session and into the US session. Make sure to always examine your support and resistance lines before entering your trades.

Let’s take a closer look at a few pairs:

USD/CAD

I’m not going to talk about the oil, but we can talk about this pair and how it is affected by the oil.  We can find that yesterday this pair made more moves supporting the price of oil, leading to a stronger CAD. Here are the Support and resistance lines for this pair today.

GBP/USD

Employment data in the UK today showed that the country lost 20.8K jobs, less than the 24.5K expected, helping the cable gain a bit against the buck. The gain put it above the 1.6000 level temporarily, though it has come off a little since then going back to the range it was trading in during the last few trading days.

Fundamentals:  We have a few announcements today that will affect the market.

Coming from US we have the “Core CPI M/M”.  The previous announcement was 0.1% and the forecast for today is 0.1%. Released at (12:30 GMT).

One more announcement coming from the US  “Unemployment Claims” which will be released at  12:30 GMT, the previous announcement was 521K and the forecast for today is 524K.

OK traders!! It is time to get some important and good education in order to become a better and more knowledgeable trader.  However to become a better trader one must know the 3 major trading sessions that control the forex market. Those 3 sessions being Tokyo, London and New York.

We all know, this market is a 24 hour a day market revolving around those 3 sessions.  As a trader it is vital to decide which session I want to trade in and follow the trend that is presented in the specific session one enters.  If you look at the chart I have enclosed you will clearly see the London session to carry more pip movement than any other session. As a trader I can find this information prudent for my success.

One more thing I want to share with you guys is this, its money time!!

Over the last few weeks many of the traders I talk to are opening positions selling the USD.  In this case many of these traders are simply following the trend and making money while doing simply that. Follow the trend and know the session you are entering to join those successful traders.

USD/CAD

Over the last few weeks and days we have continued to watch the CAD strengthen against the USD. This is happening due to 2 real reasons. The first is the overall weakness of the USD. The second is the fact that the CAD is a commodity driven currency and with the price of oil continuing to increase the CAD continues to follow that same trend. Make sure to continue searching for support and resistance lines and make sure you know those before entering the position here.

Have a great day of trading…

Today, I would like to continue to address the unprecedented weakening of the USD and the effect it has on major currencies. One of the most exciting things happening in the market over the last few weeks, days and hours are simply the record breaking increase of the Gold and silver. More so we are seeing the commodity related currencies also increase in value to a point of which few have gone and recovered from.The CAD and AUD are both approaching all time highs and continue on a strong uptrend against the USD. Is the USD done??

No, allow me to explain, many analysts across the world agree the recession is over however many believe the road to complete recovery is going to slow and painful, especially in the area of job growth. Fundamental analysis continues to show us higher unemployment rates from the US, the weakness of consumer spending continues to decline or remain flat. However with so much of the world wealth tied into the USD, it is hard to imagine a complete crash, for us traders right now the trend is clear!! We are seeing a weak USD and stronger everything else. In this market we say, “The trend is your friend”

Let’s talk on one of the most popular pair in the world

EUR/USD

The EUR has been moving in a clear uptrend. Today it reached and broke the resistance level of 1.4812. The expectation by many analysts in this market and the next resistance line for the EUR is at the 1.5000 line. Today we have seen the gold piggy back ride on the increase of the EUR with the gold reaching the level of $1065 an oz today!! The trend for this pair is clear, the fundamental and technical analysis is there to support our findings. Continue to look for the entry opportunity for this exciting and volatile pair now!!!

Here are the S&R line for Today:

Support: 1.4850-1.4780-1.4740

Resistance: 1.4890-1.4960-1.5010

Yes, Barack Obama winning the Nobel Peace Prize was the highlight of the weekend, but let’s be honest the Dollar isn’t on the same position as Mr. Obama in terms of popularity. Lets look over the last few weeks and we will find something even more interesting then the Nobel peace prize in terms of a trend.

It keeps on being positive for us as forex traders, the trends are clearly there.  Over the last few months we will see a very clear trend on most of the currencies traded in the Forex market, especially the majors. We can also see the same trend applying to the commodities.

What continues to push the commodities in the market forward appears to be the weaker dollar. So know the Nobel peace prize doesn’t look so relevant for the dollar and we will need to wait and see what will be the upcoming announcement for the US economy this week and the effect they have on the USD. So lets break it down and see how it will affect the Forex market.

This week, I am sure we will get some more movement and excitement from the market!!  However we are starting the week with Monday which happens to have 2 of the 3 largest markets closed because of a holiday. The US, CAD and JPY are all closed because of the holiday. When the biggest session is closed the market is expected to be quite and not a lot movement is expected.

Fundamentals:  We have a few announcements today that will affect the market.

Coming from New Zealand we have the “Retail Sales M/M”.  The previous announcement was -0.5%and the forecast for today is 0.6%. Released at (21:45 GMT).

One more “Core Retail Sales M/M” which will be released at  21:45 GMT, the previous announcement was -0.5% and the forecast for today is 0.5%.we have a Bank Holiday in Japan, US, and Canada so will not expected to see a strong activity from there.

NZD/USD

Let’s start analyzing this fascinating pair, earlier this week, the New Zealand dollar continued strengthening, you can clearly see it on our daily chart.

After rising by about 178 pips the New Zealand dollar moved to its highest point since the 21st of august 2008.NZD/USD has bounced from 0.1737 to previous levels close to 0.7281. Currently the pair is trading in the uptrend range between 0.7185 to 0.7281over a daily chart, it is important to note that there is a strong resistance point at 0.7310.
This pair is a wonderful pair for trend traders, we can find some opportunities by continuing to trade with this pair. Let’s convert yesterday’s movements to profits.

Resistances-0.7270-0.7310

Supports-0.7230-0.7200

Fundamentals:  We have a few announcements/meetings today which will affect the market.

Coming from U.K we have the “MPC Meeting Minutes”. (09:30 GMT) One more announcement coming in from The US “Federal Open Market Committee” which will be released at 19:15 GMT. At the same time we have Federal Open Market Committee Statement.