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Daily Trading Forecast

Death of the Dinosaurs

Mon, Jun 29 2009, 10:05 GMT
by Swiss e Trade Strategy Team

Swiss e Trade AG

In the great asset hunt of the eighties and nineties, some monsters emerged, financial and industrial ones. The disinflation after the seventies, often called the "great moderation," was the reason for that. As we now realize, it was not a moderation, it created other bubbles, which popped after only a hint of inflation. Now some big banks and conglomerates seek shelter under the state’s umbrella and they are said to be justified in doing so because they are "too big to fail." But here something is wrong. Because the only "too big to fail" scenario belongs to the central banks, not to private institutions. But we continue to see failures of financial and industrial entities daily in the news. That is a good thing, because the too big to fail dinosaurs are not the right medicine for capitalism. For Forex, that means more diversification is to come, lesser dependence on commodities or main financial streams. True, right now we are in the global near zero interest rate environment, giving not much clue to the immediate future direction.

But that is a good thing as well, because it renders the market and chart-technical reader more accuracy to his forecasts, especially in the dailies. For today’s trading, we expect some recovery moves in the pairs against the dollar, as described in the major pairs listed below. There are no real fundamental market movers scheduled for today.

by George Clement

Intraday Market Outlook for Day Traders

EUR / USD
Currently trading near support levels, the pair is priced at 1.4007 in this European morning. We expect the support at 1.3990 to hold in today’s market and later see a recovery to the 1.4090 mark.

GBP / USD
Cable for once is moving quite in tandem to the euro, hovering above support levels and currently trading at 1.6490 in a slight retreat. We see the 1.6460 support holding today and then more upmoves, to the 1.6550 level.

USD / CHF
The dollar is on a slight recovery move against the Swiss franc this European morning and currently priced around 1.0905. We do not see the 1.0940 resistance valid for today being broken and expect setbacks from there to lower levels around 1.0830.

USD / JPY
From lower levels in Asian trading, the dollar recovered further in early European hours and is currently priced at 95.50. We see more of that recovery to come today, to prices around 95.90.

Published on  Mon, Jun 29 2009, 10:06 GMT