Tuesday,May 05,2009 Charts and FAQ of the day

Tuesday, May 05, 2009 Charts and FAQ of the Day:

Good day... Hola! And a Terrific Tuesday to you! Well, today is Cinco De Mayo... It's a fun day so go have some fun!

euro, traded all the way to 1.34 and change, saw profit taking, which caused it to drop back down, only to end the day moving past 1.34 again... Overnight, the euro hit 1.3438, but once again, profits and the fact that stock futures are showing weakness have brought the Big Dog back under 1.34...

The Aussie dollar (A$) also saw a nice bid all day long yesterday, and moved past 74-cents, and remained there overnight! The Reserve Bank of Australia (RBA) left rates unchanged last night, and delivered a fairly balanced statement afterward...

The European Central Bank (ECB) will meet this week, and some of thoughts in the markets here, is that the ECB will move rates lower. Those thoughts are also responsible for the drag on the euro to bring it below 1.34 this morning...

The data cupboard is pretty empty today, after yesterday's second tier reports of Pending Home Sales, and Construction Spending printed, and left us guessing what really is happening in the economy... Today, though, we'll get a clear, concise, view of the economy from our Fed Chairman, Big Ben Bernanke! OK... We can wish can't we?


AUD/CAD – A month of consolidation on the Day chart, along with a 4-hr Pendant formation. Looks like it is fixing to breakout, watch for a move in the next couple of days.

Aud/USD - Breakout on the Day and 4-hr charts. No sign of consolidation yet.

EUR/CAD – (ditto from yesterday)
was out of range last few days, with a 4hr trend occurring. I expect some oscillation, larger ones so I am still watching it vs trading it. Best case in my book is a Conservative set, Only trading 1 set of trades on it for the time being.

EUR/USD -- The 200 on the 4hr has been broken thru to the up side. Watch for news items as that can change the pattern of Upward movement. With the European meetings to discuss Rate changes coming later this week, look for decent for consolidation over next couple of days..

GBP/USD – Strong upward moves on the 4hr And Day charts. The 4hr chart has price stretching away from the 200 MA. Out of Range for now, so look for a possible pullback.

USD/CAD -- after an extended move over last few days, I look for it to remain Out of Range generally, or to consolidate briefly before resuming a run down.

USD/CHF The 200 on the 4hr has been broken thru to the down side. Large Oscillations taking place on the 4-hr, but Day has general consolidations.

GBP/CHF -- currently crossing in and out of range, but looking to consolidate. I am looking to put this on today, will review again at noon for any changes and decide then.

EUR/JPY – 1 hr and 4 hr Oscillations with sharp moves in and out of Range. Looking to consolidate.



FAQ of the Day:


Tip 7.
A gentleman had recently lost his job and asked me if he should open a Forex account using money from his credit card. My very short answer to him was “hell no”.

Here’s the longer version of that answer:
Trading in the ForEx Market is Speculative and involves a substantial Risk of Loss. This type of trading should be undertaken with funds that are allocated to a High Risk/High Return investment vehicle, and should not be considered as part of a traditional investment portfolio allocation.

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.

If you are considering using funds that you cannot afford to loose, we strongly recommend a savings account that is FDIC insured or U.S government backed securities.