The GBP USD is trading better at the mid-session after areport showed the opposition Conservative Party’s lead over the Labor Partywidened, easing concerns that the May 6th election will produce a hung parliament.
The GBP USD is trading better at the mid-session after areport showed the opposition Conservative Party’s lead over the Labor Partywidened, easing concerns that the May 6th election will produce a hung parliament.Traders had been pressuring the British Pound lately because of concerns that ahung parliament would result in a government too weak to tackle the U.K.’s hugebudget deficit. Gains could be limited on speculation that bullish traders willbegin to liquidate their long positions ahead of the election.
Technically, this currency found support following an earlytest of an uptrending Gann angle support at 1.5397. Look for this market toremain firm unless it closes lower. In that case a reversal top will formindicating the start of a potential short-term correction.
The EUR USD is down but off its low. Following a sharplylower opening, the Euro is mounting a small comeback as reports surfaced thatthe International Monetary Fund will meet with Greece on Monday to discussfinancial aid options.
Market participants are feeling jittery again because ofconcerns over Greece.Investors are worried that the IMF/EU $61 billion financial aid plan will notbe enough to help the Greek economy and restore confidence in the Euro. At thistime, the Euro is facing serious credibility issues.
Last night Chinareported that its Gross Domestic Product grew 11.9 percent from a year ago.This was slightly better than the median guesses of 11.7 percent.The news, that China’s economy accelerated morethan expected in the first quarter, raised concerns that it may be overheating,prompting more talk of a possible interest rate like. Traders are alsoincreasing speculation that Chinamay revalue its currency as soon as next week. If this takes place, look forthe Japanese Yen to strengthen and the U.S. Dollar to weaken.
U.S.economic reports this morning helped weaken the Dollar after Weekly Initial JobClaims and Industrial Production were less than stellar. The job claims reportshowed more Americans filed for unemployment aid while factory production camein below expectations. Both reports signaled interest rates would remain low.
News that China’sGDP was up slightly more than expected during the first quarter is helping topressure the USD JPY at the mid-session. Technically, the charts indicate thatdownside momentum could take this market down to 92.26 over the near-term.Traders should also note that the general consensus suggests that the JapaneseYen is likely to gain when Chinadecides to revalue its currency.
Short-covering ahead of next week’s Bank of Canada meetingon April 20th may be helping to underpin the USD CAD at the mid-session. Thechart formation suggests the possibility of a short covering rally. Oversoldconditions are also helping this market recover after touching a new low forthe week on Wednesday.
For over a year, Bank of Canada Governor Mark Carney haspledged to keep interest rates at a record low of 0.25% through June. Canadianfinancial markets are indicating, however, that rates may rise as early as June1. This helped pressure the USD CAD below parity recently.The bigger picture suggests the CanadianDollar is likely to continue to rise because of the stronger-than-expectedeconomic recovery and expectations for interest rate increases.
The AUD USD rose overnight following China’s strongGDP report. Weaker demand for higher yielding assets, however, quickly broughtin sellers. The recent two day rally may be setting up the market for a break.This is possible due to the closing price reversal top at .9387 which is stillweighing on the markets. A trade through .9223 will turn the main trend down.
The NZD USD is feeling similar pressure but this marketcontinues to remain glued to a major 50% price level at .7124. The chartsindicate that downside pressure is likely as long as the Kiwi remains below.7200. A break through .7086 will turn the main trend down. Traders may beginto sell off both the New Zealandand Australian Dollars ahead of next week’s possible revaluing of the Yuan by China.
James A. Hyerczyk has been actively involved in the futures markets since 1982. He has worked in various capacities within the futures industry from technical analyst to
commodity trading advisor.
Using W. D. Gann Theory as his core methodology, Mr. Hyerczyk incorporates combinations of pattern, price and time to develop his daily, weekly and monthly analysis.
His firm, J.A.H. Research and Trading publishes The Forex
Pattern Price Time Report and The Futures Pattern Price Time Report, daily,
weekly, and monthly newsletters. He also manages an educational, research and consulting service.
James has provided technical analysis for Autochartist.com, The Hightower Report, eSignal, FutureSource, CQG and numerous financial market websites including ForexHound.com, FuturesHound.com, ForexTV.com, IBTimes.com, Investopedia.com, Traderslog.com, TradingMarkets.com and TraderPlanet.com.
Mr. Hyerczyk has presented seminars for Bloomberg, Reuters, Futures Magazine and the American Association of Individual Investors (AAII) in the United States, Malaysia, and Guatemala as well as private seminars in Budapest and Moscow. He also facilitated a technical analysis class at the Chicago Mercantile Exchange.
His published works include articles for Futures Magazine, Trader?s World, SFO Magazine, Forex Journal, and Commodity Perspectives (Commodity Research Bureau).
His book Pattern, Price & Time, published by John Wiley & Sons, Inc. in 1998, is available in English, Russian, German, Japanese and Chinese editions. The second edition of the book was published in April 2009.
Aside from his published works, Mr. Hyerczyk has appeared on the Financial News Network (FNN), Reuters Financial Television, Ask the Expert on WCIU-Chicago and FirstBusinessX.com. He was a weekly commentator on Money Radio.
Mr. Hyerczyk is a member of the Market Technicians Association and holds a Masters degree in Financial Markets and Trading from the Illinois Institute of Technology....More
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