Peter Bain Forex Trading Commentary Tuesday February 14th, 2006
Forexmentor.com Price Action:
With the daily, hourly, and 15 minute charts for the pound all showing downward price action, according to the 89 and 144 EMAs, it was logical to expect further erosion in price coming into today's session. That we got after the London open, facilitated by negative divergence on MACD. Further, today was declared an M1/M3 day, by virtue of the close at midnight ET being lower than the open 24 hours earlier. It's interesting to note that the 'Jeff Hughes trade' was also helpful in nailing the collapse in price that occurred shortly after 4 am ET. The 10 EMA punched down through the 80 EMA (read, 40 smoothed) on the 5 minute at 4:15 am ET, whilst STO (Stochastic) on the hourly went from being slightly overbought to trending down.
See today's chart at:http://www.forexmentor.com/campaign/feb1406.html
See sample AM Review at: http://www.forexmentor.com/sampler/feb906.html
Forexmentor.com News:
The Canadian economy saw the biggest drop in its manufacturing employment in 15 years in January, but other areas of employment are still solidly intact with respectable increases in new jobs, and Canada's trade with the rest of the world (exports and imports) soared to record levels in 2005. Exporters seem to be coping quite well with a higher Canadian dollar, and exports do not seem to be adversely affected. The Bank of Canada will more than likely go through with two 25-basis-point increases this spring, seeing the overnight target rate rising to 4.0%. We could even see two more in the fall.
On the U.S. side of things, their deficit with China has tripled since President Bush took office five years ago. As a matter of fact, the States has also racked up a record trade deficit with Canada and its other major trading partners. It's not surprising then that there is a surge of calls for curbs (read, protectionism) on Chinese imports, substantial changes in the yuan-U.S. dollar exchange rate, and the need for China to allow more U.S. goods into its country. That said, the U.S. economy has grown significantly, more so than the rest of the world. Although this situation seems to be slowly reversing. It's not only Chinese imports that added to the record trade bill last year for the U.S. They imported record amounts of crude oil in 2005.
With the daily, hourly, and 15 minute charts for the pound all showing downward price action, according to the 89 and 144 EMAs, it was logical to expect further erosion in price coming into today's session. That we got after the London open, facilitated by negative divergence on MACD. Further, today was declared an M1/M3 day, by virtue of the close at midnight ET being lower than the open 24 hours earlier. It's interesting to note that the 'Jeff Hughes trade' was also helpful in nailing the collapse in price that occurred shortly after 4 am ET. The 10 EMA punched down through the 80 EMA (read, 40 smoothed) on the 5 minute at 4:15 am ET, whilst STO (Stochastic) on the hourly went from being slightly overbought to trending down.
See today's chart at:http://www.forexmentor.com/campaign/feb1406.html
See sample AM Review at: http://www.forexmentor.com/sampler/feb906.html
Forexmentor.com News:
The Canadian economy saw the biggest drop in its manufacturing employment in 15 years in January, but other areas of employment are still solidly intact with respectable increases in new jobs, and Canada's trade with the rest of the world (exports and imports) soared to record levels in 2005. Exporters seem to be coping quite well with a higher Canadian dollar, and exports do not seem to be adversely affected. The Bank of Canada will more than likely go through with two 25-basis-point increases this spring, seeing the overnight target rate rising to 4.0%. We could even see two more in the fall.
On the U.S. side of things, their deficit with China has tripled since President Bush took office five years ago. As a matter of fact, the States has also racked up a record trade deficit with Canada and its other major trading partners. It's not surprising then that there is a surge of calls for curbs (read, protectionism) on Chinese imports, substantial changes in the yuan-U.S. dollar exchange rate, and the need for China to allow more U.S. goods into its country. That said, the U.S. economy has grown significantly, more so than the rest of the world. Although this situation seems to be slowly reversing. It's not only Chinese imports that added to the record trade bill last year for the U.S. They imported record amounts of crude oil in 2005.
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