Best Thread FXCM/DailyFX Signals and Strategies

Jason Rogers

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In this thread, we will regularly post analysis and trading signals from the DailyFX analysts and systems strategies. Comments on the analysis are always welcome whether you agree or disagree.
 
http://www.trade2win.com/boards/forex-news-analysis/71234-fxcm-dailyfx-signals-strategies.htmlhttp://http://www.trade2win.com/boards/forex-news-analysis/71234-fxcm-dailyfx-signals-strategies.html MIDDAY SNAPSHOT & ANALYSIS OF SELECTED RATES
Written by Joel Kruger, Technical Currency Strategist

Gbp/Usd: Although Monday’s bearish price action has now been totally negated, we retain our bearish outlook and will look to take advantage of the choppy market conditions to establish a fresh short trade on Tuesday. Hourly studies are now looking well overbought and the market has also exceeded its daily average true range of 200 points. There is a confluence of resistance by 1.6580 in the form of the 10/20-Day SMAs, and 78.6% fib retrace off of the recent 1.6665-1.6275 move, and as such we will look to take advantage and sell on a push into this confluence. STRATEGY: SELL @1.6580 FOR AN OPEN OBJECTIVE, STOP @1.6780. RECOMMENDATION TO BE REMOVED IF NOT TRIGGERED BY NY CLOSE (5PM ET) ON TUESDAY.

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Bank of England Votes 6-3 to Expand Asset Purchases, Governor King Dissents

Written by David Song, DailyFX Currency Analyst

The Bank of England Minutes showed the MPC unanimously agreed to keep the benchmark interest at the record-low, but voted 6-3 to increase the scope of the asset purchase program by GBP 50B to GBP 175B earlier this month.

Governor Mervyn King, along with Timothy Besley and David Miles pushed for a GBP 75B expansion in an effort to support an economic recovery, with the statement going on to say that ‘all members agreed that substantial further asset purchases were needed over the next three months’ as policymakers expect inflation to remain below the 2% target until 2012. The board maintained a dovish outlook for price growth and projects inflation to slip below an annual rate of 1.0% this year, and went onto say that ‘insufficient stimulatory monetary policy’ could hamper the prospects for a sustainable recovery as the outlook for future growth remains uncertain. Meanwhile, the central bank noted that ‘the most immediate downside risks to the economy seems to have receded,’ while the rate of money growth remained surprisingly weak, and the BoE may take further steps to steer the economy out of the recession as price pressures remain subdued.

As a result, the British pound tumbled lower against its currency counterparts following dovish outlook held by the central bank, and slipped back below the 50-Day moving average (1.6464) to retrace the previous day’s advance against the U.S. dollar. However, the overnight decline looks to have stalled at an intraday low of 1.6375, with the pair holding above the weekly low (1.6275), and a rise in U.K. retail sales may push the GBP/USD higher over the next 24 hours of trading as growth prospects improve.

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To view the original analysis, click here
 
EURUSD Resistance Line

Written by Jamie Saettele, Senior Currency Strategist

As mentioned this morning, the EURUSD trend is bearish below 1.4330. If the pair is going to turn down, then this is a good place for that to happen. A line drawn off of the most recent 2 highs is at current price.

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Read the full report.
 
Rising Swiss Exports And Investor Confidence Add To Signs Recession Ending

Written by John Rivera, DailyFX Currency Analyst

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Fundamental Headlines

• OECD Economies Improve, but Weak Recovery Is Expected – Wall Street Journal
• Small Firms Rack Up Job Losses – Wall Street Journal
• Rio Tinto profits drop in line with rivals– Financial Times
• Stocks Rise Worldwide as China Rebounds; Industrial Metals Gain – Bloomberg
• King Changes Tune as Slump Prompts ‘Activist’ Stance– Bloomberg


USDCHF – The Swiss Trade balance surplus widened to 2.35 from 1.5 billion as exports rose by 4.1% as tradimg partners Germany and France are realizing positive growth. The increasing foreign demand may help end the country’s recession which is expected to lag Europe in recovery. Meanwhile, the Swiss Zew investopr sentiment reading soared to 18.6 from 0.0, which was a three year high and reinforced the positive outlook. However, the Swiss Nationa Bank’s Discuss the topic and your trade ideas in the USD/CHF Forum.


GBPUSD – Retail spending in the U.K rose 0.4% in July, which was in-line with expectations, while the annual rate of consumption increased 3.3% from the previous year to top market forecasts for a 2.7% rise. The breakdown of the report showed demands for household goods jumped 4.5% after contracting 1.0% in June, while discretionary spending of food slipped 1.0% from the previous month, with sales of clothing and footwear slipping 0.4%. The fourth gain in the last five months bodes well for future growth as consumer demand accounts for a large portion of the country’s GDP. Discuss the topic and your trade ideas in the GBP/USD Forum.

Read the full report here
 
GBPJPY Short Term Triangle

Written by Jamie Saettele, DailyFX Senior Currency Strategist

A triangle appears to be unfolding since the low was made at 153.44. Triangles are continuation patterns so favor a break below 153.44 before a more important low forms. Short term resistance is at 156.00 and price ideally remains contained by the resistance line drawn off of the August 10th, 13th, and 20th highs.

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Click to read full report
 
6 Month Triangle in Gold

We've launched a website called CFD Trading | Contracts For Difference | CFD News and Signals . Here's an article from Jamie Saettele of DailyFX on gold.


Thursday, 20 Aug 2009 6:01 EDT at 18:01 by Jamie Saettele
Since the end of February, gold has traded in a contracting range and taken the form of a triangle. The immediate barriers are 927.60 on the downside and 974.30 on the upside. However, the critical levels are 907.60 on the downside and 993.60 on the upside. A break of either of these levels would warrant a breakout strategy. A break higher targets the all-time high set in March 2008 at 1034. A break lower could result in a test of the October 2008 low at 681. Although the break may not occur for a number of weeks, this is a chart worth keeping an eye on.

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Full Report Found Here
 
Euro Could Hit Fresh 2009 Highs If Data Signals End of Euro-Zone Recession

Written by Terri Belkas, DailyFX Currency Strategist

The euro staged an impressive rebound against the US dollar from 1.4050 last week, closing Friday just below resistance at 1.4350. The appreciation was the result of a variety of factors, including broad US dollar weakness, but also from fundamental forces.

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Fundamental Forecast for Euro: Bullish

- German investor sentiment jumped to the highest level in over 3 years
- German producer prices plunged 7.8% in July from a year ago, the sharpest drop since records began in 1949
- German services, French manufacturing PMI breached 50 in August, signaling growth for first time in 12+ months

The euro staged an impressive rebound against the US dollar from 1.4050 last week, closing Friday just below resistance at 1.4350. The appreciation was the result of a variety of factors, including broad US dollar weakness, but also from fundamental forces. Indeed, German services PMI surged to a 16-month high of 54.1 in August while French manufacturing PMI hit a 15-month high of 50.2, signaling an expansion in activity after growth had contracted for more than a year. Together, these helped push the Euro-zone composite PMI, which encompasses both manufacturing and services, up to a 14-month high of 50 from 47.0. Now, 50 is the point of neutrality for these indices, so the data suggests that business activity in the Euro-zone registered no change during August, but put into perspective with the record lows seen in the first quarter, the news is positive. The data was timely when also considering Federal Reserve Chairman Ben Bernanke’s comments from the Jackson Hole Symposium – a meeting of the world’s central bankers and finance ministers – as he said we are "beginning to emerge" from a deep global recession. Given strong PMI reports, it looks like the Euro-zone could be helping lead the way.

That said, upcoming economic reports may exacerbate this optimistic sentiment or derail it. On Wednesday, the German IFO survey of business confidence. Like the latest ZEW survey, the results are anticipated to reflect a surge in confidence, with the index estimated to creep up to a 10-month high of 89.0 in August from 87.3. On Thursday, the German GfK survey of consumer confidence is projected to rise to a more than 1-year high of 3.6 in September from 3.5 and on Friday, Euro-zone economic confidence is anticipated to increase to a 10-month high of 78.0 in August from 76.0. Overall, a steady stream of positive news could be the impetus to drive EURUSD to fresh 2009 highs. That said, such a move would also require a broad increase in risk appetite, as the US dollar is still treated as a safe haven asset.


Full Report Found Here
 
US Dollar Carving Out Bottom Against Most Major Currencies

Written by Ilya Spivak, DailyFX Currency Analyst

NZD/USD

Strategy: Pending Short

New Zealand Dollar positioning is largely the same as that of its Australian counterpart: the pair is showing a dramatic rising wedge confirmed by clear negative divergence on the RSI oscillator, with a bearish reversal to confirm a double top below the September 2008 swing high. We will look for a daily close below the wedge bottom (currently at 0.67) to enter short.

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To reach Ilya regarding this article or subscribe to his email distribution list, please contact him at [email protected]

Full Report Found Here
 
Trend of the Day - EUR/GBP

Written by Gregory McLeod, Power Course Instructor

The Euro Pound Resurrection?

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After reaching a high of .9803 at the end of last year, EUR/GBP hopes of a parity party was dashed as the 8 month slide brought the pair down to its knees at the June lows of .8417. This happened to be the 61.8% Fibonacci retracement zone of the October 20th 2008 .7692 run up to the December 2008 high of .9803. Look for this pair to challenge its June 5th .8869 high in the coming days with .9005 well within reach.

Full Report Found Here
 
Metatrader

Jason
Looking at the Metatrader screen....seems the dealer intervenes at market?

Is it the same with spreadbets via FXCM?

Apart from that the Metatrader charts are good.....can these be used with FXCM spreadbets?
 
Jason
Looking at the Metatrader screen....seems the dealer intervenes at market?

Is it the same with spreadbets via FXCM?

Apart from that the Metatrader charts are good.....can these be used with FXCM spreadbets?

hi Neil,

Both the Metatrader and spreadbetting platform with FXCM use no dealing desk execution, so there are no requotes or dealer intervention. All of the orders on the Metatrader platform are at best orders, so they will either go through at the price clicked on or the next best price available. Did you get an error message when trading on the Metatrader platform?

We don't have Metatrader available for spreadbet accounts yet, but I know that there are plans to offer it eventually. Key word being eventually :rolleyes: The primary focus right now is getting CFD's released. What some of our traders do is set up the spread bet account, and then use one of our MT4 demos for the charting.
 
September Effect Could Push S&P 500 Lower, Japanese Yen Higher

Written by David Rodriguez, Quantitative Strategist

The “September Effect” on the S&P 500 and broader risky assets has typically led stocks lower on the month, and a continuation in said tendency would likely push the safe-haven US Dollar and Japanese Yen higher through the foreseeable future. Indeed, the month of September is historically the worst month of the year for the S&P. It is interesting to note that the US Dollar Index has likewise historically fallen in September, but a shift in market dynamics suggests that this is less likely in the month ahead.

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September Effect in the US S&P 500 Index

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Seasonal tendencies point to S&P 500 declines through the month of September. The S&P 500 has fallen through in said month through 11 out of the past 20 years of trading—good for over 10 points on average. Though this may not seem like much, the past 10 years have actually seen the S&P drop over 50 points on four different occasions. We can give no concrete explanation for the clear September underperformance, but it is likewise fairly clear that S&P 500 trading volume picks up substantially as traders return from summer breaks. If the past is any indication of what is to come, traders should be on the lookout for risk sentiment-linked Japanese Yen and US Dollar gains through September.

Read Full Report Here
 
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Record Low European Producer Prices Allows ECB to Remain On Hold

Written by John Rivera, Currency Analyst

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Fundamental Headlines

• Global Economy Gains Steam– Wall Street Journal
• M&A Revival Seen in Three Deals – Wall Street Journal
• EU wary on withdrawing fiscal stimuli – Financial Times
• Wells Fargo Will Repay TARP `Shortly' Without Raising Equity, Stumpf Says – Bloomberg
• Stocks Fall for Third Day, Industrial Metals Drop; Australian Dollar Gains -Bloomberg

Full Report Found Here
 
Gold Triangle Break

Wednesday, 2 Sep 2009 4:26 EDT at 16:26 by Jamie Saettele @ www.cfdtrading.com

Gold’s rally pushed through what may be the top of a triangle. Price remains beneath highs in February and April but a rally above there puts the all time high at 1034 (March 2008) in jeopardy. Structurally, even a new high is probably just temporary. An unorthodox top in wave B of an expanded flat would pave the way for wave C to eventually drop below 681. Interestingly, the 1999-2008 rally is equal to the 1976-1980 rally in terms of price. 2008 momentum, as measured by RSI, did not reach the 1980 level. This creates a significant divergence that is typical of major turning points. Even allowing for a new high in gold, the metal appears much closer to a top than a bottom.

goldtri.png



You can also sign up for CFDOil, Gold, and Equity research by email on the sign up page

Full Report Found Here
 
US Non-Farm Payrolls Fall By Least in a Year, Unemployment Rate Surges to 9.7%

Written by Terri Belkas, DailyFX Currency Strategist

FX markets have been extremely choppy this morning after US unemployment data fell into two ends of the spectrum: surprisingly optimistic and deeply disappointing. Starting with the good news, non-farm payrolls (NFPs) fell by 216,000 in August, which was less than forecasts for a drop of 230,000 and the slowest pace of job losses in a year. At the same time, though, the unemployment rate jumped beyond forecasts to 9.7 percent - the highest since 1983 - from 9.4 percent.

US Non-farm Payrolls (Monthly Change)
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A breakdown of the overall NFP report shows divergence from leading indicators going in to this release, as the number of job losses in the manufacturing sector increased to 63,000 from 43,000 despite the rise in ISM manufacturing during the same period, which actually reflected an expansion in business activity for the first time in nineteen months. On the other hand, service-providing employment fell by 80,000 in August, compared to a decline of 154,000 in July and 251,000 in June. At the end of the day, the surge in the unemployment rate tells us that the US economy is still struggling to gain traction, despite proclamations that the recession has ended, and as long as jobless claims are rising, there will be little impetus for consumption - which makes up more than 70 percent of GDP - to improve.

The market's reaction to the news was quite volatile, as DJIA and S&P 500 futures initially fell, then rallied, then pulled back once again. This translated into similarly wild moves in JPY, as well as in USD. At the time of writing, the DXY index had broken above Thursday's highs, but with liquidity low ahead of Monday's US market closure for the Labor Day holiday, there is a high risk of similarly choppy price action throughout the rest of the day. Traders beware.

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Source: FXtrek IntelliCharts

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US Dollar May Finally See Break from Summer Ranges as Liquidity Returns

Here's a breakdown of next weeks important news events. There are 4 central bank meetings:

Written by Terri Belkas, Currency Strategist

The US dollar, British pound, and commodity dollars face potential for major moves and significant breakouts from summer ranges next week due to the combination of the post-holiday return of liquidity, rate decisions from the Reserve Bank of New Zealand, Bank of England, and Bank of Canada, along with Australian employment and US consumer confidence reports.

• Reserve Bank of New Zealand – September 9, 17:00 ET
The Reserve Bank of New Zealand (RBNZ) is still anticipated to leave the Official Cash Rate target unchanged for the third straight meeting at 2.50 percent. In RBNZ Governor Alan Bollard's last policy statement, he sounded extremely cautious on the outlook for the economy, especially because the strength of the New Zealand dollar had created additional risks. Where the New Zealand dollar ends the trading day will likely have to do with the status of one statement though: the final portion. We also saw in the last policy statement that the RBNZ maintained that it was “appropriate to continue to provide substantial monetary policy stimulus to the economy” and that the central bank could still lower rates “modestly” during the coming quarters as they “continue to expect to keep the OCR at or below the current level through until the latter part of 2010.” If the RBNZ eliminates the phrase noting that they could still lower rates, the New Zealand dollar is likely to surge in anticipation of rate hikes down the line. On the other hand, if the RBNZ maintains their dovish-neutral tone, the currency could slip.

• Australian Employment Change (AUG) – September 9, 21:30 ET
At 21:30 ET, the Australian net employment change may show a decline of 15,000 during August following a surprise increase of 32,200 in July. Furthermore, the unemployment rate is anticipated to edge up to 5.9 percent, the highest since July 2003, from 5.8 percent. Since the employment change tends to be a very volatile release, this should have the greater impact on the Australian dollar, with a sharper than expected drop likely to weigh on the currency and an unexpected positive result likely to push it higher.

• Bank of England Rate Decision – September 10, 7:00 ET
The Bank of England (BOE) is anticipated to leave rates unchanged at 0.50 percent on Thursday at 7:00 ET, but this won’t even be the market-moving part of the announcement. Instead, traders will be looking toward the BOE’s policy statement. This has consistently been the prime “news event” of recent rate decisions, including last month, when the BOE unexpectedly announced a £50 billion expansion to their quantitative easing program that would likely come to an end in early November. That said, with no expansion anticipated, the statement is likely to just be a straightforward announcement offering little insight, and thus, the British pound shouldn’t show much of a reaction.

• Bank of Canada Rate Decision - September 10, 9:00 ET
The Canadian dollar could see a pickup in volatility on Thursday at 9:00 ET as the Bank of Canada is expected to leave rates unchanged at 0.25 percent once again. After the Bank left rates unchanged on July 21, they said that they would maintain a neutral stance through June 2010, and the rest of the statement was relatively optimistic as they revised forecasts for growth. The outlook for 2009 was revised up to -2.3 percent from -3.0 percent while the 2010 outlook was revised up to 3.0 percent from 2.5 percent. That said, the BOC has made it clear that their policy stance is contingent upon the inflation outlook, which they most recently judged as offering downside risks. If we said a reiteration of these comments and no substantial shift away from cautious optimism to more positive sentiment, the BOC’s statement may not be a huge market-mover. However, if the BOC comments upon the negative impact of the Canadian dollar’s strength, we could actually see the currency pull back if it reflects some potential for more verbal intervention.

• University of Michigan Consumer Confidence (SEP P) – September 11, 9:55/10:00 ET
The preliminary reading of the University of Michigan’s consumer confidence index is forecasted to rise to 67.3 in September from 65.7, which would be supportive of claims to the US economy is showing signs of recovery. Indeed, based on the latest US non-farm payrolls results, the pace of job losses has slowed markedly, which may help to boost investor sentiment. That said, the major issue we want to point out with this report is that the official time of release is 10:00 ET, but it typically hits the wires at 9:55 ET, which can exacerbate any surprise factor from the actual results.

See the entire economic release calendar here
 
Gold Triangle Break

Gold’s rally pushed through what may be the top of a triangle. Price remains beneath highs in February and April but a rally above there puts the all time high at 1034 (March 2008) in jeopardy. Structurally, even a new high is probably just temporary. An unorthodox top in wave B of an expanded flat would pave the way for wave C to eventually drop below 681. Interestingly, the 1999-2008 rally is equal to the 1976-1980 rally in terms of price. 2008 momentum, as measured by RSI, did not reach the 1980 level. This creates a significant divergence that is typical of major turning points. Even allowing for a new high in gold, the metal appears much closer to a top than a bottom.

Daily
goldtri.png



Read the Full Report Here
 
Elliott Wave Analysis: USD/CHF

Written by Jamie Saettele, DailyFX Senior Currency Strategist

The USDCHF is in the exact same position as the EURUSD. A C wave will probably be complete following a drop below 1.0367. A target is 1.0037 (100% extension of 1.2303-1.0367 decline). Only a rally above channel resistance would suggest that a low is in place. Near term, a 4th wave consolidation looks likely. Resistance extends to 1.0490.

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Read the Full Report Here
 
US Dollar May Gain as Stocks Position to Turn Lower

Written by Ilya Spivak, DailyFX Currency Analyst

The US Dollar may gain in the days ahead as equity markets reverse lower, boosting demand for the safety-linked currency. The MSCI World Stock Index is showing a Rising Wedge bearish reversal formation, with confirmation offered by negative divergence on the RSI oscillator. The US Dollar Index is now -91.3% inversely correlated with the MSCI metric.

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