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COMMENTARY

• Classic Technicals: The Week Ahead, Apr. 15-20, 2012
  Written by Matthew Weller
  Last updated 4/15/2012 3:55:12 PM ET
  A technical preview into what this week's price action may bring for 7 major currency pairs...
  3 comments
• EUR/JPY to Resume Downtrend at 107.46?
  Written by Bradley Gareiss
  Last updated 4/13/2012 6:00:02 PM ET
  A bearish Gartley pattern is forming on the EUR/JPY within the context of the recent downtrend.
  0 comments
• AUD/JPY Fades off 4-Week Trendline, Targeting Weekly Lows
  Written by Matthew Weller
  Last updated 4/13/2012 12:00:43 PM ET
  As of right now, the AUD/JPY is forming a Dark Cloud Cover* candle on the 4hr chart, signaling a likely reversal and to potential for a move toward the low end of the recent range. Meanwhile, the break below the 84.00 floor increases the probability of a move down to the next level of support, the weekly lows at 82.50.
  0 comments
• Live Account vs. Demo Account
  Written by Bradley Gareiss
  Last updated 4/12/2012 8:30:29 PM ET
  We will review why your results in your demo account will probably contrast sharply with the results in your live account.
  3 comments
• Stocks up on Fed stimulus hopes
  Written by David Morrison
  Last updated 4/12/2012 12:41:39 PM ET
  In early trade, US stock index futures were pointing to a firmer open this afternoon, but had pulled back from their best levels. Equities popped higher yesterday after a string of negative closes, and the current bias this morning remains to the upside. However, despite a stronger start in Europe, there are now signs of stock weakness in Portugal, Spain and Italy. If this persists, then we can expect other markets to drift lower ahead of the US open. Before then we'll see PPI, weekly unemployment claims and the latest trade balance. In addition, FOMC members Lockhart, Dudley and Raskin are all speaking. Investors are desperate for clues to the Fed's current thinking on further stimulus measures. But so far, Fed speakers have made a good job of playing down expectations of additional quantitative easing, while saying that nothing is "off the table". Overall, the recent correction in US equities has been brief and shallow. This would suggest that a more severe sell-off is overdue. However, with the first quarter earnings season now underway, and speculation mounting over the Fed's intentions, investors appear to be sticking with the tried and tested formula of "buying the dips" for now.
  0 comments
• Tightening GBP/CAD and USD/JPY Stops
  Written by Matthew Weller
  Last updated 4/12/2012 12:09:42 PM ET
  So far this week, we have accumulated a number of open trades (as always, you can see an updated list of all trades to watch and open trades here). In particular, we are looking to tighten the stop on two of the trades that we placed earlier this week.
  0 comments
• Trading Psychology- Recency Bias
  Written by Bradley Gareiss
  Last updated 4/11/2012 8:17:10 PM ET
  What is recency bias, and how can it negatively impact your trading results?
  1 comment
• GBP/JPY: Bearish Channel to Guide Rates Down 150 More Pips?
  Written by Matthew Weller
  Last updated 4/11/2012 12:53:51 PM ET
  The British Pound Sterling, like many major currencies, has been trending lower against the Japanese yen over the past few weeks. A quick look at the daily chart reveals that rates have broken through significant previous support at 130.00, exposing the next level of previous support all the way down at 126.65…
  0 comments
• Stocks stage a small rally
  Written by David Morrison
  Last updated 4/11/2012 12:10:51 PM ET
  US stock index futures were firmer this morning with buyers taking advantage of yesterday's sharp sell-off. The S&P is currently 4% down from the intra-day high of 1,425 hit just a few weeks ago, and this pull-back has helped to scrape some of the bullish froth off equities. However, traders are likely to look for quick turns rather than rushing to re-establish more permanent long positions. The markets feel fragile and there is every chance of a more substantial downward correction. Additional central bank stimulus seems to be on the back-burner for now, despite Friday's poor non-farm payroll data. On top of this, Europe's debt crisis is back in focus. There are concerns that Spanish banks may need more capital, while Mario Monti, Italy's caretaker technocrat Prime Minister, is now struggling to implement labour reforms. It now looks as if Italy's economy will contract much further in 2012 than previously predicted. The first quarter earnings season kicked off last night with Alcoa beating market expectations. This has also helped to give stock index futures an early lift. On the data front, we have Import Prices, Crude Oil Inventories, the Fed's Beige Book and the Federal Budget Balance. FOMC voting member and dove, Janet Yellen, will be speaking at 19:00 BST.
  0 comments
• Risk FX Rallies on Short Covering
  Written by Boris Schlossberg
  Last updated 4/11/2012 6:37:51 AM ET
  Risk FX seesawed in Asian and early European session but eventually traded higher in the wake of Italian and German bonds auction that saw the spread in yield between the periphery and the core narrow slightly. Despite the fact that Italian auctions went off at higher yields than the period prior, while German auction was essentially uncovered, risk currencies overcame credit concerns and moved higher as the day progressed with EUR/USD making its way through the 1.3150 level by midmorning Frankfurt trade.
  0 comments
• Update: NZD/JPY to Resume Uptrend at 66.03?
  Written by Bradley Gareiss
  Last updated 4/10/2012 8:03:10 PM ET
  We have updated the profit target for our NZD/JPY bullish trade idea.
  0 comments
• Make-or-Break Moment for AUD/CAD Downtrend
  Written by Matthew Weller
  Last updated 4/10/2012 12:52:22 PM ET
  Though the AUD/CAD bounced modestly this week, the bounce appears more corrective in nature, with small candles and sizable wicks. With rates now testing the long-term bearish trend line once again, the odds favor a reversal lower over the next few days. Further bolstering the case for selling trades, we can see that rates are approaching previous-support-turned-resistance at 1.0312. Combined with the dynamic trend line resistance, this level suggests that the recent rally is likely to stall in the near future as the long-term downtrend reasserts itself.
  6 comments
• Equities slide again
  Written by David Morrison
  Last updated 4/10/2012 12:40:49 PM ET
  US stock index futures were little-changed this morning. Investors appear to have digested Friday's weaker-than-expected non-farm payroll data, and are now reassessing the probability that the Federal Reserve will reopen the door to further stimulus. After all, last week's sell-off was triggered by the minutes from the FOMC's March 13th meeting. These suggested that members had shifted away from additional QE. However, in more recent pronouncements, Ben Bernanke has reminded investors of the importance of the "maximising employment" component central bank's dual mandate. If jobs data continue to disappoint over the next month or so, then investors will bet on a new asset purchase programme being announced before June. The first quarter earnings season kicks off today with Alcoa releasing results after the close. Negative pre-announcements are running at their highest level since 2009, while last quarter's earnings beats also came in at their lowest rate for three years. This is despite analysts revising down their expectations significantly. On the data front, today sees the release of Wholesale Inventories and the IDB/TIPP Economic Optimism index. FOMC member (and 2012 voter) Lockhart will also be talking.
  2 comments
• Following the Plan
  Written by Bradley Gareiss
  Last updated 4/9/2012 9:03:59 PM ET
  Creating a trading plan is one thing; following it is another.
  0 comments
• GBP/CAD: Inverted Head-and-Shoulders Suggests Imminent Buy
  Written by Matthew Weller
  Last updated 4/9/2012 12:52:53 PM ET
  The GBP/CAD, though not a commonly traded currency pair, offers relatively tight spreads and decent volatility, with the an average daily range of 111 pips according to the ATR(14). More importantly, the currency pair is showing a clear price action pattern on the 4hr chart that suggests a buy opportunity may be imminent.
  0 comments