Develop a habit of reviewing and analyzing
Develop a habit of reviewing and analyzing your good and bad trades. Then you will have a much better sense of what will work best in your future trades.
Trading is always full of emotions
Because trading is always full of emotions, you must have a trading strategy which includes a set of rules you stick to. This will help protect you from yourself.
software which aims at predicting future trends
While there are a lot of companies who make money by selling software which aims at predicting future trends, the reality is that if this software really worked, these companies would not be giving the secret away.
Trade wisely
There are many beginners who make trades in any direction. While there is a possibility to make profits both on the upside and downside of a trade, trading in the direction of the trend will give you the best chances for success
Invest in a good Forex trading education
The market is always changing and it may be hard to understand and keep up with these changes unless you invest in a good Forex trading education
Monday, 3 February 2014
Dollar near recent highs vs. euro, edges up vs. yen
European stocks open lower on China slowdown concerns
USD/JPY Outlook Feb. 3-7
- Monetary Base: Monday, 23:50. Monetary Base dropped in December to 46.6%, short of the estimate of 55.2%. No significant change is expected in the upcoming reading, as the Bank of Japan maintains its aggressive monetary policy. The estimate for the January release stands at 47.2%.
- 10-year Bond Auction: Tuesday, 3:45. The average yield on 10-year bonds continues to creep upwards, with the previous yield rising to 0.72%. No change is expected in the January release.
- Average Cash Earnings: Wednesday, 1:30. This indicator is an important gauge of consumer spending. The indicator jumped to 0.5% last month, its biggest gain in almost a year. The markets are expecting the upward trend to continue, with the January estimate standing at 0.7%.
- 30-year Bond Auction: Thursday, 3:45. The average yield on 30-year bonds has been quite steady, with a yield of 1.67% in December. No change is expected in the upcoming release.
- Leading Indicators: Friday, 5:00. Leading indicators is based on 11 economic indicators. Still, it is considered a minor event since most of the data has been previously released. The indicator has been steadily improving and reached 110.8% last month. Further improvement is expected in the January reading, with the estimate standing at 111.9%.
EUR/USD Forecast February 3-7
- EUR/USD Risk Points To The Downside, Set To Test The 1.3400 Level: With EUR reversing its previous week gains and returning below its rising trendline, further decline is envisaged in the days...
- ECB Preview: 5 scenarios – negative deposit rate now, or later?: The European Central Bank convenes in February as the level of inflation remains stubbornly low, and the economic recovery remains...
- EUR/USD support lines – uptrend broken, downtrend dominates: Looking at the daily chart of EUR/USD, we can observe two clear trend lines. With one clearly broken, the second...
- US dollar strengthens against the euro: The last trading day of January saw the dollar in the ascendency, the dollar index just short of the highs...
- Manufacturing PMIs: Monday. The Eurozone Manufacturing sector improved considerable from November, confirming the euro-area is on the right track to recovery. The headline reading reached 52.7 in line with market forecast compared to 51.6 achieved in November. This was the highest reading in 2.5 years. Italian manufacturing edged up 1.5 points to 53.3, beating expectations for a 51.3 reading, raising optimism about positive growth in 2014. Spanish manufacturing rebounded in December posting 50.8 compared to 48.6 in November indicating expansion. Manufacturing activity is expected to improve further with Spain reaching 51.3, Italy climbing to 54.2 and the Eurozone is expected to reach 53.9.
- Spanish Unemployment Change: Tuesday, 8:00. Spanish jobless claims declined sharply in December amid a boost in hiring for shops and other service sector preparing for the holiday season. Jobless claims edged down by 107,570, the biggest December drop on record, and the second biggest of any month on record, offering hope for a recovery process in 2014. However, Spain continues to have the second-highest unemployment rate in Europe. Over the last 12 months, the number has fallen by 147,385. Another decline of 21,300 is expected in the number of unemployed.
- Italian CPI: Tuesday, 10:00. Italy’s consumer prices increased by 0.2% in December, following a 0.4% decline in November. Prices were decelerating across the board, indicating weak economic activity. Prices for transport services rose 1.2% over the year against a 6.5% rise in 2012, housing and utilities prices rose 2 percent against a 7.1 percent rise in the previous year and food prices rose 2.2% against 2.6% the previous year. Another rise of 0.3% is forecast this time. Italian CPI will have an impact on the final euro-zone CPI for January.
- Services PMIs: Wednesday. Eurozone services advanced at the slowest pace in four months. Ongoing domestic sluggishness in some member-states continued to weigh on recovery toward the end of 2013. Eurozone services declined from 51.2 to 51.0 in December still signaling expansion. Spain registered the biggest leap in six years, reaching 54.2 compared to 51.5 in the previous month, but Italy continued to contract posting 57.9 in December following 57.2 in November. Nevertheless the PMI’s suggest that Eurozone recovery has gathered momentum at the end of 2014. Services sectors in Spain and Italy are expected to improve further with Spain reaching 55.3 and Italy advancing to 48.2 though still in contraction and the Eurozone is expected to reach 51.9.
- Retail Sales: Wednesday, 10:00. Euro zone retail sales soared in November beating expectations by climbing 1.4%, following 0.4% decline. Analysts expected a minor increase of 0.2%. In November, sales in the food, drinks and tobacco sector were up 1.1% m/m and 1.4% y/y while turnover in the non-food sector rose by 1.9% m/m and 2.4% y/y. Euro zone retail sales are expected to decline 0.7% this time, after Germany reported a surprising drop of 2.5%.
- Retail PMI: Thursday, 9:10. The Eurozone retail PMI continued to slide for the fourth month running, falling to 47.7 from 48 in November, showing strong contraction in France and slower growth decline in Germany. Eurozone retail PMI data are based on the three largest Eurozone economies; Germany rising for the eighth month running in December, France downturn increased, as sales fell for the fourth successive month and Italy continued to post the sharpest decline in sales of the three economies. Nevertheless, these declines were lower than in previous months.
- German Factory Orders: Thursday, 11:00. German factory orders advanced by 2.1% in November 2013, suggesting Europe’s largest economy is on a solid recovery path for 2014. The boost in orders came both from domestic market and abroad. Economists believe German economy will recover in a faster pace in 2014 as well as contribute to the Eurozone’s recovery. An increase of 0.3% is expected now.
- Eurozone rate decision: Thursday, 12:45, press conference at 13:30. The ECB will likely leave its policy unchanged, but could certainly set the ground for a negative deposit rate in March. Inflation continues to fall in Germany and in the euro-zone. It will be harder for Draghi and co. to deny the danger of deflation, and it will be harder to wave with a negative deposit rate and not use it eventually. In the press conference, he could use words to hint an imminent cut of both the main lending rate and the deposit rate in March, and this would hurt the euro..
- German Trade Balance: Friday, 7:00. Germany’s trade surplus increased in November to a near record of 17.8 billion euros evoking criticism among euro-zone partners that Germany is not spending enough to help out its struggling neighbors. The reading was 24.2 billion euros higher than in the previous month due to a 0.3% rise in exports. The United States, tried to urge Germany to spend more, while the International Monetary Fund has said a smaller surplus is the only way reduce imbalances that plague the Eurozone. Germany’s trade surplus is predicted to narrow to17.3 billion euros.
- German Industrial Production: Friday, 11:00. German industrial production expanded more than expected in November climbing 1.9%, following a 1.2% decline in October, suggesting Germany is rebounding. The increase topped predictions of a 1.6% increase suggesting a solid recovery trend. Furthermore German business confidence skyrocketed in December indicating German people are confident in Germany’s recovery. German central bank Bundesbank projected that the German economy would expand by 0.5% in 2013 and by 1.7% in the New Year. Another advance of 0.5% is predicted this time.
GBP/USD Outlook Feb. 3-7
- Manufacturing PMI: Monday, 9:30. This index continues to look strong, although last month’s reading of 57.3 points was short of the estimate. The forecast for the January reading stands at 57.1 points.
- Halifax HPI: Tuesday, 4th-7th. This housing inflation indicator is an important gauge of activity in the UK housing industry. The index declined by 0.6% last month after a strong gain the month before. The estimate for the January reading stands at 0.4%.
- Construction PMI: Wednesday, 9:30. Construction PMI continues to be a bright spot and the last two releases have been above the 60-point level. Another strong reading is expected for January, with an estimate of 61.6 points.
- BRC Shop Price Index: Wednesday, 00:01. This indicator looks at inflation in the BRC chain of stores. We continue to see readings in negative territory, with the previous release coming in at -0.8%.
- Services PMI: Wednesday, 9:30. This index has looked strong, but dipped below the 60-point level last month for the first time since June, coming in at 58.8 points. A similar reading is expected in the upcoming release.
- Asset Purchase Facility: Thursday, 12:00. The BOE is expected to maintain its QE program at 375 billion, where it has been pegged since July 2010.
- Official Bank Rate: Thursday, 12:00. The benchmark interest rate has been held at 0.50% for the past four years. With the UK economy producing strong data, there has been speculation about a rate hike, although we’re unlikely to see one this week. If economic indicators, particularly employment numbers, continue to improve, the BOE may be forced to act or risk an overheated economy.
- Manufacturing Production: Friday, 9:30. This key release disappointed last month, posting a flat 0.0%, well below the estimate. The markets are expecting better news from the January release, with the estimate standing at 0.6%.
- Trade Balance: Friday, 9:30. The UK continues to post trade deficits. The previous release saw a deficit of -9.4 billion pounds and little change is expected in the upcoming reading.
- NIESR GDP Estimate: Friday, 15:00. This indicator helps analysts track GDP on a monthly basis, as official GDP is released on a quarterly basis. The indicator has been steady and came in last month at 0.7%.
Forex Weekly Outlook Feb. 2-7
- ECB Preview: 5 scenarios – negative deposit rate now, or later?: The European Central Bank convenes in February as the level of inflation remains stubbornly low, and the economic recovery remains...
- US dollar strengthens against the euro: The last trading day of January saw the dollar in the ascendency, the dollar index just short of the highs...
- US ISM Manufacturing PMI: Monday, 15:00. Manufacturing grew in December and expanded at the second-fastest pace in more than two years, reaching 57 following 57.3 in November boosted by a rise in orders. The sharp growth in orders drove companies to increase hiring and global recovery lifted business investments. A drop to 56.2 is expected this time.
- Australian rate decision: Tuesday, 3:00. The Reserve Bank of Australia (RBA) maintained its cash rate unchanged at 2.5% in December, in line with market consensus. RBA Governor Glenn Stevens stated the Australian economy grew less than forecasted in 2013 due to a decline in mining investment. However private demand outside the mining sector is expected to grow at a faster pace. The Australian dollar is still high, despite recent drops. The RBA board will continue to assess the outlook and adjust policy as needed, Stevens said. No change in rates is forecast, but some expect a more hawkish bias after the strong CPI numbers.
- NZ employment data: Tuesday, 21:45. New Zealand’s unemployment rate declined more than expected in the third quarter, reaching 6.2%, down 0.2% from the previous quarter, amid growth in construction, retail and hospitality firms hired workers. Furthermore, NZ’ job market expanded 1.2% in retail, accommodation and food services, and the construction sector. The main gains were registered in Auckland and Christchurch. Full-time employment increased 1% and part-time jobs grew 1.1%. New Zealand’s job market is expected to grow by 0.7%, while the unemployment rate is predicted to decline to 6.0%.
- US ADP Non-Farm Employment Change: Wednesday, 13:15. The US private sector gained 238,000 jobs in December, much better than the 119,000 addition projected by analysts. This release was higher by 9.000 compared to November. Over the course of 2013, goods-producers added 286,000 jobs and service-providing industries gained 170,000 jobs in December. These positive gains suggest continued growth in 2014. A gain of 191,000 positions is expected now.
- US ISM Non-Manufacturing PMI: Wednesday, 15:00. The US services sector activity decelerated in December, reaching 53 compared to 53.9 in November due to a decline in orders at the end of the year. However the service sector industry, showed some promising signs of stronger employment and rising prices. The slowdown reflected December’s easing in the manufacturing sector, falling to 57.0 from 57.3 in November. However the severe winter might have contributed to this decline. US services sector is expected to rebound to 53.8.
- UK rate decision: Thursday, 12:00. The Bank of England (BoE) kept interest rates at a 0.5% and maintained its asset purchase target at £375 billion in line with predictions. Analysts believe the central bank will have to change its tone regarding the forward guidance plan, due to continued signs of recovery in the UK market. Mark Carney, said last August he does not intend to raise rates until unemployment goes down to 7.0%. If all goes well, Carney will raise rates in the second half of 2014. Rates are expected to remain unchanged this time. YoY, UK GDP rose at the fastest pace in 6 years.
- Eurozone rate decision: Thursday, 12:45. The ECB will likely leave its policy unchanged, but could certainly set the ground for a negative deposit rate in March. Inflation continues to fall in Germany and in the euro-zone. It will be harder for Draghi and co. to deny the danger of deflation, and it will be harder to wave with a negative deposit rate and not use it eventually. In the press conference, he could use words to hint an imminent cut of both the main lending rate and the deposit rate in March, and this would hurt the euro..
- US Trade Balance: Thursday, 13:30. The U.S. trade deficit narrowed to its lowest level in four years in November, reaching a trade gap of $34.3 billion following 39.3 billion in the previous month. Economists expected trade deficit to reach $40.2 billion in November. This improvement contributed to the Q4 GDP growth. Exports increased 0.9% to $194.9 billion. Meanwhile overall imports declined 1.4% to $229.1 billion. US trade gap is expected to widen to $35.8 billion.
- US Unemployment Claims: Thursday, 13:30. Weekly claims for U.S. unemployment benefits edged up 19,000 last week to one month high of 348,000 claims, but remained relatively low. The increase follows three weeks of declines and may have been pushed up by the cold weather. However there are positive signs for growth in the third and fourth quarters indicating things are getting better and will continue to do so on the coming months. The number of unemployment claims is expected to drop to 334,000.
- Canadian employment data: Friday, 13:30. The Canadian job market contracted 45,900 jobs in December posting the weakest year of job growth since 2009. This unexpected fall raised concerns about future growth. The unemployment rate edged up to 7.2%, following 6.9% in November. Despite rumors of a rate cut Bank of Canada governor Stephen Poloz has maintained rates in January.
- US Non-Farm Payrolls: Friday, 13:30. US non-farm payrolls increased by 74,000 in December, far below the 196,000 gain expected by analysts. However the weak reading was related to the harsh weather conditions. Meanwhile, the unemployment rate edged down to 6.7% from the 7% in November. The labor force participation rate continued to decline, reaching 62.8% after a reading of 63% in the previous month. However, analysts believe the weak reading in December does not suggest renewed downward trend. US non-farm work force is expected to grow by 185,000, while the unemployment rate is expected to remain 6.7%. A significant revision to December’s figure could be seen now.
Forex Trading Signal for 3rd Feburary 2014
Japan (Tokyo) United Kingdon (London) USA (New York)
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Forex Trading Signal for 31st January 2014
Japan (Tokyo) United Kingdon (London) USA (New York)
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