Archive For "July, 2010"

The U.S. dollar pares gains versus most major as the first official estimate of second-quarter U.S. economic growth comes in below expectations.

WASHINGTON (MarketWatch) — The U.S. economy lost momentum in the second quarter of the year. Real gross domestic product — the inflation-adjusted, seasonally adjusted value of all goods and services produced in the United States — rose at a 2.4% annualized rate in the second quarter, well below the average 4.4% increase over the last six months. The rate of expansion in the first quarter was revised up to a 3.7% rise compared with the prior estimate of a 2.7% increase. Much of the deceleration in the second quarter was due to the trade sector. The 2.4% increase in GDP was close to the 2.5% expansion expected by economists surveyed by MarketWatch. (Fixes time period in the description of the deceleration.)

The U.S. economy lost momentum in the second quarter of the year, according to figures released Friday, which may raise concerns of an extended soft patch if not an outright contraction.

NEW York (MarketWatch) — Treasury prices climbed slightly and the dollar pared gains after a report said the U.S. economy grew 2.4% in the second quarter, a little lower than many analysts expected, but following a first-quarter that was revised much higher than initially reported. Yields on 10-year notes which move inversely to prices, fell 7 basis points to 2.93%. The dollar index , which tracks the U.S. unit against a basket of major currencies, traded at 81.680, compared to 81.750 before the data and up from 81.559 in North American trade late Thursday. The euro fell to $1.3039, down from $1.3094 late Thursday. Still to come is a pair of regional manufacturing reports and data on consumer confidence.

The U.S. dollar is higher versus most major counterparts other than the Japanese yen as investors’ appetite for risk remained subdued ahead of the first official estimate of second-quarter U.S. economic growth.

Some Japanese stocks with an orientation toward exports take a hit as a result of strength in the yen, and Asian equities end the trading week broadly lower.

LONDON (MarketWatch) — The unemployment rate in the 16-nation euro zone was steady at 10% in June, the European Union statistics agency Eurostat reported Friday, in line with market expectations. Separately, Eurostat said consumer price inflation in the euro zone rose at an annual rate of 1.7% in July, up from 1.4% in June and also in line with forecasts.

LONDON (MarketWatch) — German retail sales fell 0.9% in June, the Federal Statistical Office reported Friday. Compared to the same month last year, sales rose 3.1%. Economists had forecast a 0.3% monthly decline.

HONG KONG (MarketWatch) — Japanese shares ended lower for a second straight day on Friday as exporters were broadly hurt by a stronger yen and as Nintendo Co. dropped after posting a quarterly loss. The Nikkei Stock Average closed 1.6% lower at 9,537.30 and the broader Topix gave up 1.4% to 849.50. Shares of Canon Inc. lost 0.8% and Elpida Memory Inc. sank 4.3%, while Nintendo Co. skidded 1.8%. Sony Corp. was an exception, climbing 3.6% after it Thursday swung back to profit for the April-June period and also raised its full-year net and operating profit forecasts.

Daily Outlook: Short term signals continue to be bullish. I’ve had a bearish long term outlook since 2009, though since early July I’ve been buying along with the uptrend. Earlier this week I tested the waters of a longer-term short only to be stopped out quickly. Luckily those short term buys I keep piling on more than make up for the bad trade. The trade had a great reward/risk ratio, and great money mangement, so even if I only win that one 1 out of 4 times I would be profitable, so I don’t feel bad about being taken out of the position.

Today is Friday, so I’ll be cautious and most likely head into the weekend trade-free, but the short term trend is up so I will continue to keep an eye open for buying opportunities. As always check the candlestick alerts for intraday trading opps and watch out for news events on the forex calendar.

Trading Idea: Bearish retracements have been few and far between recently, so for the primary trade I’m moving the entry zone up to 1.3015 (from 1.2950 yesterday) with confirmation. Long targets at 1.3040, 1.3070, 1.3100 and 1.3130 for 115 pips profit.

A much more aggressive long would be at 1.3045 with targets at 1.3070, 1.3095 and 1.3120 for 75 pips profit.

Finally if you are hesitant about long positions that is a much riskier short you can take: short on a sustained break below 1.3015 with targets down to 1.2950 for 65 pips profit.

Stay safe, use a stop-loss and never trade with money you can’t afford to lose.

Happy pipping and have a great weekend!

P.S. You’ll be getting more news this weekend!

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