Forex Trading Signal for 20 May 2013

                                                                                


Japan (Tokyo)                               United Kingdon (London)                        USA (New York)

For more easy access,,,,,,Download our mobile application on your mobile :   Click Fxsignals 

EUR/USD

Down Trend :

 (1) SELL

E/P: 1.28378

T/P: 1.28000

S/L: 1.28700

 

-->

GBP/USD

Down Trend:

(1) SELL

E/P: 1.51980

T/P: 1.51500

S/L: 1.52300

NOTE: The above posted Signals are delayed 2 - 4 hours after it has been  generated.
Daily forex signals are sent ontime to only our subcribers.

To subcribe: click here

Read More

GBP/USD Outlook – May 20-24

The pound’s troubles continue, as the currency lost almost two cents against the US dollar this week. GBP/USD closed the week at 1.5168. The upcoming week is a busy one, and the highlights include CPI, Retail Sales and GDP. Here is an outlook of the events and an updated technical analysis for GBP/USD.

Solid UK employment numbers failed to boost the pound, which has been on a downward trend throughout the month of May. The dollar made some gains on Friday after a strong UoM Consumer Sentiment release.

GBP/USD graph with support and resistance lines on it. Click to enlarge:  

1. Rightmove HPI: Sunday, 23:01. This housing inflation release has shown respectable rises in recent readings, indicating activity in the British housing market. The previous release came in at 2.1%, and the markets will be hoping for a similar rise in the May release.
2. CPI: Tuesday, 8:30. This key inflation index has been quite steady, posting 2.8% gains in the past two releases. The estimate for the upcoming reading stands at 2.6%.
3. PPI Input: Tuesday, 8:30. This inflation index dropped 0.1% last month, the first decline since January. The markets are braced for another drop in May, with an estimate of -1.2%.
4. RPI: Tuesday, 8:30. RPI includes housing costs, which are not measured by CPI. This index has also been steady, and posted a 3.3% gain in April. The estimate for the May release stands at 3.1%.
5. MPC Meeting Minutes: Wednesday, 8:30. Analysts will be looking at the breakdown of the voting pattern by the MPC members in the interest rate and asset purchase decisions. Although the BOE has maintained the levels of these two items for quite some time, the markets have reacted in the past to split votes by the MPC members.
6. Retail Sales: Wednesday, 8:30. Retail Sales looked stellar in March, with a 2.1% jump, only to post a drop of 0.7% in April. The estimate for the upcoming release stands at 0.0%. Will the indicator surprise the markets and push back into positive territory?
7. Public Sector Net Borrowing: Wednesday, 8:30. The budget deficit ballooned to 16.7 billion pounds last month, the highest level in two years. The estimate stood at 14.3 billion pounds. The markets are expecting a much better result in the May release, with an estimate of 7.6 billion pounds.
8. CBI Industrial Order Expectations: Wednesday, 10:00. This indicator has been mired in negative territory, indicating ongoing weakness in the UK manufacturing sector. The indicator dropped to -25 points last month, but the markets are expecting an improvement, with an estimate of -17 points.
9. Second Estimate GDP: Thursday, 8:30. GDP is one of most important economic indicators, and can affect the movement of GBP/USD. The indicator declined 0.3% in Q4 of 2012, and the weak figure weighed on the pound. The markets are expecting a turnaround for Q1, with an estimate of a 0.3% gain. Will GDP meet or beat this prediction?
10. Preliminary Business Investment: Thursday, 8:30. This indicator measures the change in capital investments made by businesses and the government, and is released each quarter. The indicator has shown volatility, and posted a 1.2% in Q4 of 2012 after a sharp 3.7% jump in the previous quarter. The markets are expecting a rebound in Q1, with a forecast of a 1.7% gain.
11. BBA Mortgage Approvals: Friday, 8:30. Mortgage Approvals provides a good measure of activity in the British housing market. The indicator matched the forecast last month, with a reading of 31.2 thousand. The estimate for the upcoming release is slightly higher, at 32.7 thousand.

GBP/USD Technical Analysis

GBP/USD opened the week at 1.5344. The pair touched a high of 1.5385, but then resumed its downward slide, dropping all the way to 1.5158, breaking through support at 1.5189 (discussed last week). GBP/USD closed the week at 1.5168.

Technical lines from top to bottom:

With the pound continuing to slump, we begin at  lower levels. There is strong resistance at 1.5648. This line has held firm since mid-February. We next encounter resistance at 1.5560. This line was providing support at the start of the month, but fell as the GBP/USD went on a sharp slide which continues. Next there is resistance at 1.5484. This is followed by 1.5416. This line was providing support, but the pair broke through early last week. We next encounter support at 1.5258. This line was active last week, and has strengthened in resistance as the pair trades at lower levels. Next, 1.5189 is providing weak resistance. It could see more action early this week.

GBP/USD is receiving support at 1.5061, which was last tested in the first week of April. This is followed by 1.5010, protecting the all important 1.50 level. Below is 1.4896, just below the round number of 1.49. It has held fast since mid-March. The final support line for now is 1.4648, which was last tested in June 2010.

I am bearish on the GBP/USD.

The markets remain pessimistic about the prospects of the British economy. This was underscored by the fact that positive UK employment numbers failed to prop up the pound, which continues to dive – the currency has shed four cents against the dollar in May. We could see the pound move closer to the 1.50 level, especially if US numbers rebound this week.

Read More

EUR/USD Forecast May 20-24

EUR/USD: suffered a second week of significant falls after euro-zone figures disappointed and the dollar kept advancing. Is the pair ready to recover or are we going to see more drops? Flash PMI’s and German Ifo Business Climate are the highlights of this week. Here is an outlook for the main events and an updated technical analysis for EUR/USD.

Eurozone economic data was hit by a constant flow of disappointing GDP numbers, dragging the 17-country currency bloc to its longest-ever recession. Germany the leading force in Europe failed to meet market expectations, growing a mere 0.1% in March. France contracted 0.2% in March and officially fell back to recession. The EU as a whole declined by 0.2%. Is the recovery awaiting us in H2 as the ECB estimates? In the meantime, the central bank continues to check out the possibility of a negative deposit rate, and this weighs on the euro. In the US, data hasn’t been all rosy, but the economy continues growing.

EUR/USD daily graph with support and resistance lines on it. Click to enlarge:

1. German PPI: Tuesday, 6:00. Manufacturers’ products inflation in Germany declined in March 0.2% on a monthly bases, following a 0.1% drop in February, driven by falling energy prices. Analysts expected a 0.1% climb. On a yearly basis, PPI gained 0.4% in March. A smaller drop of 0.1% is forecast. Lower inflation (now confirmed for the euro-zone) was one of the triggers for the rate cut.
2. EU Economic Summit: Wednesday. European Union leaders will gather in Brussels under Irish presidency and discuss pressing budget and foreign policy issues of early 2013 and on to other challenges in the “European Council Priorities up to 2014.
3. Current Account: Wednesday, 8:00.  The euro zone’s current account surplus grew in February to EUR16.3 billion from EUR13.8 billion the previous month due to increased trade. January’s current account surplus was revised down to EUR13.8 billion from an initial estimate of EUR14.8 billion published in the previous month. A decline to EUR14.2 billion is expected now.
4. Flash Manufacturing and services PMIs: Thursday: France begins at 7:00, Germany is next at 7:30 and figures for the euro-zone are released at 8:00. A sharp decline was registered in German business activity in April, down to 47.9 from 49 in March, while economists expected a reading of 49.0. Another decline occurred in Germany’s service sector, falling to 49.2 in April from 50.9 in the previous month raising concerns that the strongest EU nation is affected by the general slowdown. Meanwhile French figures were more optimistic. The manufacturing sector increased 0.4 points to 44.4, above predictions for a 44.2 reading and the service sector edged up to 44.1 from 41.3 in March, raising hopes of an emerging recovery process. Furthermore, Markit’s flash euro zone services PMI, rose to 46.6 in April from 46.4 in March, but the manufacturing sector declined slightly to 46.5 from 46.8 in March, still below the 50 point line, however, signaling that the worst is over. French Manufacturing PMI is expected to improve to 44.8 and the Service sector to climb to 11.7; German Manufacturing PMI is expected to reach 47.9 while the service sector is expected to cross the 50p point line reaching 50.2. Finally the Eurozone is also expected to improve with the manufacturing sector reaching 47.1 and the services sector reaching 47.4.
5. Consumer Confidence: Thursday, 14:00. Consumer sentiment in the euro zone improved in April, rising to -22.3 from -23.5 in March. The reading was higher than the -23.85 estimated by analysts. The same reading is predicted now.
6. GfK German Consumer Climate: Friday, 6:00.  German consumers were more optimistic in May amid a strong jobs market and high expectations of salary rises. The reading was 0.2% higher than in April, beating market forecast of a 5.9 reading. However, consumers did turn more pessimistic about the general economic outlook after three months of improvements, in line with recent news from retailers. No change is forecast this time.
7. German Ifo Business Climate: Friday, 8:00. German business sentiment declined to 104.4 in April, down from 106.7 in March, down for the second consecutive month. The reading was well below the 106.4 estimated by analysts. German economy resisted the Eurozone crisis but was eventually dragged down by the lasting recession. The sharp drop may ruin changes of a substantial recovery this year. A rise to 104.6 is expected now.
8. Belgium NBB Business Climate: Friday, 13:00. Belgian business confidence remained nearly unchanged in April improving by a mere 0.3 points to -14.7. Analysts expected a stronger reading of 14.3 points. A further rise to -13.4 is expected this time. 

*All times are GMT

EUR/USD Technical Analysis

Euro/dollar began the week trading above the 1.2960 level (mentioned last week). It then dropped to lower ground, trading between 1.2840 and 1.2890. An attempt to recover didn’t succeed and the pair eventually broke lower, eventually closing at 1.2838.

Live EUR/USD chart:

Technical lines from top to bottom:

We start from lower ground this time. 1.3290 served as resistance before the pair collapsed in 2012, After many failures to break higher, the euro finally pushed through. 1.3255 provided support during January 2013 and also beforehand. A recovery attempt failed to reconquer this line.

1.32 is a clear top after capping the pair twice in April 2012 and then in May. This is a round number as well. 1.3160, which separated ranges in May 2013 is a critical line..

1.3100 is a minor line after working as temporary resistance in December 2012. It is followed by 1.3050, which proved be strong support in May 2013, defending the round number in more than one occasion, and also working as resistance.

The very round 1.30 line was a tough line of resistance for the September rally. In addition to being a round number, it also served as strong support and recently worked as a pivot line. 1.2960 provided some support at the beginning of the year and also in September and October – the line is now weaker after the break lower.

1.2840 worked as a cushion for the pair during May 2013 and is a pivotal line at the moment. Lower, 1.2890 worked in both directions during 2012 and was the beginning of the uptrend support line. The recent breakdown turned the line into strong resistance. Lower, the round number of 1.28 was the bottom of a long term wide range in 2012 and its breach in May 2013 is still not confirmed.

Below, 1.2750 worked as a separator of ranges during November, and stopped the pair’s drop in March. This is a key line on the downside, as clearly shown in the first week of April. This is followed by the round number of 1.27, which is a minor line.

1.2624 was a swing low in January 2012 and remains important on any break to the downside. It is followed by the veteran line of 1.2587.

I remain bearish on EUR/USD

The weak GDP numbers confirm the economic weakness of the euro-zone once again. Adding theincessant talk about negative rates and even the call for the ECB to “manage the euro lower“, and we have a recipe for more euro weakness. Only the Japanese ignited flows to peripheral bonds support the euro.

In the US, some figures are better, and some are worse. Yet all in all, the economy is growing and there are more signs that the Fed might change course: Williams, a dove on the Fed, began talking about unwinding QE, beginning this summer. Talk about an end to QE is certainly dollar positive.

Read More

Forex - Weekly outlook: May 20 - 24

The dollar rallied against the other major currencies on Friday, climbing above 103 per yen after data showed that U.S. consumer sentiment rose more than expected in May, climbing to an almost six year high.

The University of Michigan said its consumer sentiment index jumped to 83.7 in May, its highest level since 2007, from 76.4 in the preceding month, outstripping expectations for a reading of 78.0.

A separate report by the Conference Board showed that its index of leading economic indicators rose 0.6% in April, more than double the 0.2% increase expected by economists.

The robust data bolstered expectations that the Federal Reserve could begin to scale back its USD85 billion a month asset purchase program this year.

The data came after a series of economic data releases on Thursday raised doubts over the strength of the U.S. economic recovery.

Official data showed that consumer price inflation and housing starts fell more-than-expected in April, while jobless claims posted the largest increase in six months.

The dollar rose to its highest level against the yen since October 2008, with USD/JPY advancing 0.90% to settle at 103.19, extending the week’s gains to 1.46%.

The dollar rose to six-week highs against the euro and the pound, withEUR/USD dropping 0.37% to settle at 1.2834, 1.20% lower for the week and GBP/USD falling 0.65% to settle at 1.5168, down 0.92% for the week.

The dollar hit a nine-month high against the Swiss franc, with USD/CHFup 0.79% to close at 0.9724, gaining 1.65% for the week.

Elsewhere, the Canadian dollar fell to a more than two-month lows against the greenback after official data showed that Canadian consumer inflation rose 0.4% year-on-year in April, the slowest rate of growth in more than three years.

The weak data sparked speculation that the Bank of Canada may cut interest rates.

USD/CAD hit highs of 1.0312 the pair’s highest since March 8, before trimming gains to settle at 1.0276, 0.83% higher for the day and up 1.68% for the week.

The Australian dollar dropped to an 11-month low against the greenback on Friday, with AUD/USD settling at 0.9736 down 0.73% for the day and extending the week’s losses to 2.4%. The New Zealand dollar hit its lowest level since November, with NZD/USD down 1.07% to 0.8068 at the close, dropping 2.39% for the week.

In the week ahead investors will be focusing on Wednesday’s Federal Reserve minutes, as well as testimony on the economic outlook and monetary policy by Fed Chairman Ben Bernanke.

Markets will also be watching the outcome of Wednesday’s Bank of Japan policy meeting and euro zone data on manufacturing and service sector activity.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

Monday, May 20

The U.K. is to release private sector data on house price inflation.

Markets in Canada are to remain closed for the Victoria Day holiday.

Tuesday, May 21

The Reserve Bank of Australia is to release the minutes of its most recent policy setting meeting, which contain important insights into economic conditions from the bank’s perspective. 

Australia is also to publish an index of leading economic indicators, while New Zealand is to produce official data on inflation expectations.

Germany is to release official data on producer price inflation, a leading indicator of consumer inflation.

The U.K. is to produce government data on consumer price inflation, which accounts for the majority of overall inflation, as well as data on producer and retail price inflation.

Wednesday, May 22

Australia is to release private sector data on consumer sentiment, a leading economic indicator.

Japan is to release official data on the trade balance, the difference in value between imports and exports.

The BoJ is to announce its benchmark interest rate. The announcement is to be accompanied by the bank’s monetary policy statement, which contains important insights into the economic outlook. The BoJ is to hold a press conference after the rate announcement.

The euro zone is to release data on the current account, while Italy and Germany are to hold government bond auctions. European Union leaders are to hold an economic summit in Brussels.

The Bank of England is to publish the minutes of its most recent policy setting meeting, which contain important insights into economic conditions from the banks perspective. 

The U.K. is to release official data on public sector net borrowing, as well as a report on industrial order expectations.

The Chairman of the Swiss National Bank Thomas Jordan is to speak; his comments will be closely watched.

Canada is to produce official data on retail sales, the government measure of consumer spending, which accounts for the majority of overall economic activity.

The U.S. is to release data on existing home sales, a leading indicator of economic health, while the Fed is to publish the minutes of its most recent policy-setting meeting.

Meanwhile, Fed Chairman Ben Bernanke is to testify on the economy and monetary policy in Washington.

Thursday, May 23

China is to release the preliminary reading of its HSBC manufacturing index, a leading economic indicator.

The euro zone is to release preliminary data on manufacturing and service sector activity. Germany and France are to produce individual reports. Meanwhile, Spain is to hold an auction of 10-year government bonds.

Later Thursday, European Central Bank President Mario Draghi is to speak; his comments will be closely watched.

The U.K. is to publish official data on retail sales, as well as revised data on first quarter economic growth and a report on business investment.

The U.S. is to release the weekly government report on initial jobless claims and official data on new home sales, a leading indicator of economic health.

Friday, May 24

New Zealand is to publish official data on the trade balance.

The Ifo Institute is to release a closely watched report on German business climate, a leading economic indicator. Germany is also to release revised data on first quarter economic growth and the Gfk index of consumer climate.

The U.K. is to release industry data on mortgage approvals, an important indicator of demand in the housing market.

The U.S. is to round up the week with government data on durable goods orders, a leading indicator of production.

Read More