Submitted Apr 16, 2012|From forexblog.oanda.com

At the Boao Forum for Asia held earlier this month on the island of Hainan in the South China Sea, the topic of the U.S. Federal Reserve’s monetary policy came up for discussion. More correctly, the topic of how the Federal Reserve monetary policy ...

Submitted Apr 16, 2012|From forexblog.oanda.com

1.29 and 1.28 are the near term ‘big’ picture support levels that this market is hoping to take out for the long suffering bear positions. Interestingly, theses overall short positions have been greatly reduced and technically, the market is ...

Submitted Apr 15, 2012|From forexblog.oanda.com

Recent economic data is beginning to support this global shift toward pessimism for risky assets. The plethora of global PMI releases of late has printed lower. Last month we witnessed weaker trade numbers for Korea and China, a disappointing US ...

Submitted Apr 14, 2012|From forexblog.oanda.com|2 comments

There was a ‘small’ percentage of a chance that the BoJ was to continue along the easing path earlier this week after last month’s surprise announcement. However, Governor Shirakawa refrained from expanding monetary easing to counter deflation, ...

Submitted Apr 13, 2012|From forexblog.oanda.com

“Freaky Friday” or Friday the 13th did not disappoint. The week has ended very much in risk-off mode; with macro risk sentiment taking another step backwards. The “highly accommodative rhetoric” from Fed Yellen and the BoJ’s Shirakawa pursuit of ...

Submitted Apr 13, 2012|From forexblog.oanda.com|6 comments

For the past two days this market was willing to apply risk. Investors were encouraged by the “highly accommodative rhetoric” from Fed Yellen and the BoJ’s Shirakawa pursuit of “powerful easing” to overcome deflation. Throw into the mix stronger ...

Submitted Apr 11, 2012|From forexblog.oanda.com|5 comments

If it cannot go up surely its got to go down. How long can the 17-member single currency trade in this consolidated range with so much negativity piling up against it? Now that the quarter-end window dressing has come and gone, investors are back to ...

Submitted Apr 10, 2012|From forexblog.oanda.com|1 comment

One gets the feeling that there is less ‘straight line’ risk being applied, especially with the hedge fund community caught still quite long risky assets. Until now, the risky asset trading strategy approach has been reasonably resilient, with a ...

Submitted Apr 8, 2012|From forexblog.oanda.com

Canadian and US employment reports could not be so different. Canada produced a whopping +82k new jobs last month, beating all expectations and now has futures dealers pricing in a year end rate hike, while the US could only manage an anemic +120k ...

Submitted Apr 8, 2012|From forexblog.oanda.com

Asian FX remains hostage to the “big dollars” continuing attempt to turn stronger on the one hand and continuing resistance to currency appreciation from Asian central banks on the other. Next week is starting to feel like a big week for the BoJ. It ...

Submitted Apr 5, 2012|From forexblog.oanda.com|1 comment

It was too good to be true. Until now, the lure of “almost free” liquidity has been too hard to turn down. To constantly have upbeat expectations for global growth, given the slew of data pointing to further slowing, including China, has been an ...

Submitted Apr 4, 2012|From forexblog.oanda.com

For the month of February, China suffered its largest trade deficit in more than a decade. A decline in demand for China’s exports has resulted in a sharp decline in sales. Meanwhile, Chinese consumers are ratcheting up their own spending levels ...

Submitted Apr 4, 2012|From forexblog.oanda.com

The difference in a word here and there by the Fed has again dragged many EUR bear position back on side. Yesterday’s minutes of the FOMC March meeting were viewed as generally hawkish. The replacing of ‘a few’ by ‘a couple’ of members does not show ...

Submitted Apr 3, 2012|From forexblog.oanda.com

This is day three of a new quarter and the EUR price action is already boring. The forex asset class is being left behind by both equities and fixed income in excitement. Bond dealers are beginning to believe that the worst may be over for US ...

Submitted Apr 2, 2012|From forexblog.oanda.com|3 comments

Last week, the Eurozone finance ministers voted to increase the “firewall” rescue fund from 500 billion euros ($667 billion), to 800 billion euros ($1.07 billion). The fund was established last year to ensure money was set aside should another ...

Submitted Apr 2, 2012|From forexblog.oanda.com

Markets were not expected to be trading this way, however its a pleasant surprise for the first trading day of a new quarter. Perhaps the ‘hard’ landing question for China can be forgotten until their next major data point at least. On the weekend, ...

Submitted Mar 31, 2012|From forexblog.oanda.com

The immediate concern is that the slew of PMIs out early next week will suggest that the global recovery is stumbling, including in the US. Asia has the potential to trade on the weak side in this environment. There will be a risk of some unwinding ...

Submitted Mar 31, 2012|From forexblog.oanda.com|21 comments

Bernanke’s remarks this week on the US job market are being considered his most dovish stance to date. The reserve currency of choice chose to underperform, squeezing weaker shorts and managing to print a new medium EUR term high. Unless the market ...

Submitted Mar 30, 2012|From forexblog.oanda.com

The latest Euro monetary data continue to show that the ECB’s policy measures eased much of the distress in the financial system. For the time being it seems that deposit flight from the peripheries has eased. But although policy has prevented ...

Submitted Mar 30, 2012|From forexblog.oanda.com

A combination of factors is working against the reserve currency of choice first thing this morning. The mighty dollar is attempting to flee March under pressure on month and quarter-end rebalancing flows combined with expectations the US monetary ...