FXstreet.com

News and opinion from the ground

This report has been deactivated

0

0

Prospects Look Dim For Canadian Dollar And British Pound

Thu, Jun 5 2008, 08:07 GMT
by Grace Cheng

GraceCheng.com


GraceCheng.com

A leading New York-based financial portal, is a must-read for traders and investors who want high-impact financial news, market information and opinions from the ground.

The US dollar is stronger today against currencies like the Canadian dollar, British pound and Japanese yen, but remains more or less unchanged versus the Euro, Swiss franc. Broadly speaking, sentiment is still supportive of a USD rebound. The ADP employment report released today showed that private sector jobs rose by 40,000 in the US in May, better than the 30,000 drop expected by most economists. In April, 13,000 jobs were added by the private sector, which was revised up from the previously reported 10,000. Although the ADP data isn’t very telling, it gives a glimpse of how the government’s monthly jobs report could turn out. With the US non-farmpayrolls to be released this Friday, you’d better mark that on your calendar as it is one of the most anticipated events every month. The median forecast is for non-farm payrolls to fall by 60,000 in May.

The greenback is also supported for the time being by what Fed chief Bernanke said yesterday. He said the Federal Reserve is aware of the inflationary impacts of the weaker US dollar - an unusual reference to the US currency when speaking of the economy and monetary policy - and also hinted the end of the rate cut cycle.


Woes in Britain

Cracks are showing in the UK. Nationwide, Britain’s fourth-biggest mortgage lender, said consumer confidence dropped in May to the lowest level in four years. And a private survey by CIPS showed growth in services contracted for the first time since March 2003, falling to a falling of 49.8, versus a forecast reading of 50.5. The British pound will be pressured on the downside from weakening economic data as well as from rising inflation, two big areas of concern for the Bank of England as it begins its two-day meeting to set borrowing costs.


Upcoming Interest Rate Announcements

Interest rate decisions will be announced by the Bank of England and the European Central Bank Thursday, and both are expected to keep rates on hold at 5% and 4% respectively. Britain’s 5% main lending rate is the highest among the Group of Seven nations. For instant data releases and news announcements, check out the live news feed at GraceCheng.com.


Forex Trading

EUR/USD has been trading in a tight range after hitting a session low of 1.5410 yesterday, and is now hovering around 1.5450. It is likely to stay in this range till the ECB rate decision Thursday. Possible downside targets are 1.5390, 1.5360. USD/CHF also traded sideways and is now around 1.0400. Topside targets are 1.0530, 1.0590-1.0610. GBP/USD fell slightly over 100 pips today, and if the USD continues to show strength, Cable may next test 1.9500-10.

The US dollar rose for the fifth day in a row against the Canadian dollar today as traders speculate that the Bank of Canada may be forced to cut interest rates next week as the Canadian economy posted an unexpected first-quarter contraction. USD/CAD is now trading above 1.0100.


Thursday:

  • Australia trade balance 0130 GMT
  • New Zealand rate decision (rate expected to stay at 8.25%)
  • German factory orders 1000 GMT
  • Bank of England rate decision (rate expected to stay at 5%) 1100 GMT
  • European Central Bank rate decision (rate expected to stay at 4%) 1145 GMT
  • US initial jobless claims 1230 GMT
  • Fed’s Plosser speaks on financial stability 1600 GMT


Grace Cheng Media Inc.  | 14 Wall Street, 20th Floor - New York NY 10005
http://www.gracecheng.com/ | gracecheng@gracecheng.com

Legal disclaimer and risk disclosure

Important Risk Disclaimer Trading and/or investing of any security, product, asset or derivatives involves risk, and there is always the potential for loss. You understand that discussions of any product, asset or security published on the Site will not contain a list or description of relevant risk factors. No content published on this Site constitutes a recommendation that any particular product, security, portfolio of securities, transaction or investment or trading strategy is suitable for any specific person. You understand that none of the bloggers, information providers or their affiliates are advising you personally concerning the nature, potential, value or suitability of any particular product, asset, security, portfolio of securities, transaction, investment or trading strategy or other matter. As markets change continuously, previously published information and data may not be current and should not be relied upon. All content on the Site is presented only as of the date published or indicated, and may be superseded by subsequent market events or for other reasons. In addition, you are responsible for setting the cache settings on your browser to ensure you are receiving the most recent data. You understand and agree that, although we require all employees to disclose every stock in which they, their immediate family, or any entity under their control, have a personal interest, if such stock is mentioned in a blog, post, or content which they write, outside bloggers or other content contributors or their affiliates may write about securities in which they or their firms have a position, and that they may trade for their own account, and that they may or may not be subject to a disclosure policy. No representation is being made that the PowerFX Course, and any associated advice or training, will guarantee profits, or not result in losses from trading. Your trading results may vary. Neither the products, any explanation or demonstration of their operation, nor any training held in conjunction therewith, including, without limitation, through online chat, in conjunction with any advertising and promotional campaigns, during in-person seminars or otherwise, should be construed as providing a trade recommendation or the giving of investment advice. The Site is not intended to provide tax, legal, insurance or investment advice, and nothing on the Site should be construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product, asset or security by Grace Cheng Media Inc or Grace Cheng or any third party. You alone are solely responsible for determining whether any investment, security or strategy, or any other product or service, is appropriate or suitable for you based on your investment objectives and personal and financial situation. You should consult an attorney or tax professional regarding your specific legal or tax situation. Grace Cheng Media Inc and Grace Cheng assume no responsibility for anything posted on the forex forum. Authors of posts will be individually responsible. All external links and advertisements are for information purposes only and neither Grace Cheng Media Inc or Grace Cheng will assume any responsibility for their contents. The TOU and the relationship between you and Grace Cheng Media Inc are governed by and construed in accordance with the laws of the State of New York, without regard to its principles of conflict of laws. You and Grace Cheng Media Inc agree to submit to the personal and exclusive jurisdiction of the federal and state courts located within New York County, New York, and waive any jurisdictional, venue, or inconvenient forum objections to such courts. If any provision of the TOU is found to be unlawful, void, or for any reason unenforceable, then that provision shall be deemed severable from the TOU and shall not affect the validity and enforceability of any remaining provisions. No waiver by either party of any breach or default hereunder shall be deemed to be a waiver of any preceding or subsequent breach or default.


Interested in forex trading? forex brokerage firms!


FX Solutions LLC
Contact the broker/FDM
Open a demo account
MG Financial Group
Contact the broker/FDM
Open a demo account
MF Global FXA Securities Ltd.
Contact the broker/FDM
Open a demo account
CitiFX Pro
Contact the broker/FDM
Open a demo account
FXDD
Contact the broker/FDM
Open a demo account

GET CASH BACK FOR YOUR TRADES!   Learn more about the Pip Rebate Program

Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer.

Trading foreign exchange on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading and seek advice from an independent financial advisor if you have any doubts.

Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. FXstreet.com has not verified the accuracy or basis-in-fact of any claim or statement made by any independent author: errors and Omissions may occur.

Any opinions, news, research, analyses, prices or other information contained on this website, by FXstreet.com, its employees, partners or contributors, is provided as general market commentary and does not constitute investment advice. FXstreet.com will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.

©2009 "FXstreet.com. The Forex Market" All Rights Reserved.