Daily FX Forecast

EUR/USD

Resistance levels: 1.5670/1.5750/1.5800
Support levels: 1.5570/1.5500/1.5430

EUR/USD has fallen further below 1.5570 Support earlier today after pullback up to 1.5670 first important Resistance Today focus will be on US GDP Numbers (1Q) at 12:30 GMT The consensus is at 0.9% . On downside the break below 1.5580-70 area may signal reversal in the bias for test towards 1.5500 and even 1.5430-20 area over today and tomorrow if the number comes out at 1.2% or higher and even 1.5350 in longer term On the upside, pullback back towards first important Resistance near 1.5670 may be seen if the number comes out at 0.6% or more negative

Strategy-neutral

GBP/USD

Resistance levels: 1.9800/1.9850/1.9900/1.9960
Support levels: 1.9700/1.9650/1.9610

GBP/USD has failed to break above 1.9850 key Resistance yesterday , falling back below 1.9700 key Support No change in our view. On the upside, first Resistance comes at 1.9800 ahead of 1.9850 previos highs Beyond these levels opens territory for further upmove towards 1.9960 in longer term In short term, disappointing data from USA may cause sharp test of 1.9850 after the event On downside, further ease towards 1.9620-10 area is possible over today and tomorrow if the US GDP numbers come out stronger than expected

Buy GBP/USD at 1.9785, Stop-loss-1.9745, Take profit-1.9845( 1.9895)

USD/JPY

Resistance levels: 105.00/105.70/106.00
Support levels: 104.40/103.80/103.00/102.60

USD/JPY has hold above 104.40 key Support , rising further beyond 105.00 over the last trading sessions on the break above 104.40 level exactly as it was suggested The uptrend remains intact with next targets at 105.70 and 106.00 later today on better than expected US GDP numbers and even 108.20 in longer term On downside, disappointing data from USA may turn price back to first important Support at 104.40 later today after the event

Buy USD/JPY at 105.40, Stop-loss-105.00, Take profit-105.95 ( 106.40)

USD/CHF

Resistance levels: 1.0440/1.0500/1.0600
Support levels: 1.0400/1.0350/1.0260/1.0220

USD/CHF has reversed strongly directly beyond 1.0440 over the last trading sessions as it was suggested on the break above 1.0300 again As long as price holds above 1.0360-50 first Support area further upmove beyond 1.0500 is not ruled out later today and even 1.0600-10 area over today and tomorrow On downside, soft data from USA in an hour may turn price back to 1.0360-50 first crucial Support area later today First minor Support stands at 1.0400

Strategy-neutral.

EUR/JPY

Resistance levels: 164.00/164.50/165.00/165.30
Support levels: 163.00/162.50/162.00

The Cross has risen to 164.50 next Resistance yesterday as it was suggested No change in our view. The uptrend remains intact for test towards 165.00 and 165.30 in mid term First Resistance comes near 164.00 Beyond resumes the uptrend towards 165.00 and 165.30 On downside, the break below 163.80 Support may turn price back to 163.00 stronger one later today

Strategy-neutral.

FXDream

FOREX : Foreign Exchange Market

FOREX is a word play on the term Foreign Exchange Market. It is a market for buying and selling of currencies from all over the world. Certainly, such transactions are bound to be voluminous. It is just an estimate that there are about transactions of $1.5 trillion USD on a daily basis in the FOREX. Now just compare this with the paltry $300 billion USD a day transactions for the US Treasury Bond and the $100 billion a day transactions for the US Stock Exchange.

The FOREX came into existence in 1971 when the fixed currency exchanges were abolished. Currencies no longer had fixed values after that; on the contrary, their rates (mostly taken in comparison with the USD) were fluctuating, and changed on a daily basis. Throughout the seventies and the eighties the FOREX grew steadily, showing more advancement in the later years. The market has stupendously grown from $70 billion USD a day to the staggering amount that it transacts today on a daily basis.

There are actually about five thousand trading institutions in the FOREX. These include international banks, central government banks such as the US Federal Reserve, and commercial companies and brokers for all types of foreign currency exchange. The best thing that shows the unbiased nature of the FOREX market is that it has no fixed headquarters anywhere – it operates primarily from all major cities like New York, Tokyo, London, Hong Kong, Singapore, Paris, Frankfurt, etc. One can even use the telephone or the internet to make the transactions. The major businesses at the FOREX are the buying and selling of products in other countries. Several transactions are also conducted from the currency brokers or traders who stand to make small profits with the daily fluctuations in the market.

Most of the FOREX business is centered on big banks and financial institutions, but it doesn’t mean that the FOREX is inaccessible to small investors. The recent changes in the financial regulations have effectuated this accessibility. Earlier, a minimum transaction size was required to conduct business with the FOREX. But the current rules have made it possible to break large inter-bank units into smaller bits. Each bit is worth as less as $100,000. This makes it possible to each individual investor through loans that are extended for trading, known as leverage. The ratio to control the lots is 100:1. This means, every $1000 USD will allow one to control $100,000 on the FOREX.

The benefits of trading with the FOREX are mentioned below:-

(1) Liquidity of Investments – As the FOREX is a huge market, the funds have a very high degree of liquidity. This is because of the presence of the international banks who provide their bids and carry out a large number of transactions on a daily basis. Therefore, there is always a buyer or seller for any type of currency.

(2) Highest Degree of Accessibility – The FOREX is open 24 hours a day for 5 days a week. Every Monday morning the exchange opens at Australian Standard Time and closes on Friday afternoon at New York time. Greater accessibility is provided because the transactions can be conducted from the person’s home or office.

(3) Open Market – At the FOREX, there are no secrets. All the fluctuations that occur in the market are made accessible to everyone at the same time. There is no insider trading in the FOREX.

(4) No Commission – There is no hassle of paying commission to the brokers in the FOREX. Here the brokers earn by setting up a difference between the buying price and the selling price of a currency, which is known as a spread.

It must be understood by now that for the FOREX to work effectively, the currencies must always be traded in pairs. For instance, the Japanese yen must be traded against the euro. When one kind of currency is sold, there should be another to be bought in its stead.

The profit happens because there is always mobility between the different currencies. Even if there is a miniscule change in the exchange rate, then it could mean substantial changes in the profits due to the large amount of money involved in the transactions. People are thronging to the FOREX and not any other institution due to the trust that they have in it. To add to the advantage, the market is absolutely well-advanced and uses sophisticated software for dealing out its transactions.

FOREX-DD : Forex Daily Analysis