Archive For "October, 2010"

NEW YORK (MarketWatch) — The dollar pared its advance and Treasury prices held onto gains on Friday after an index on U.S. consumer sentiment fell to 67.7 this month. A separate report showed manufacturing in the Chicago region improved this month. Yields on 10-year notes , which move inversely to prices, fell 5 basis points to 2.62%. The dollar index , which measures the U.S. unit against a basket of six major currencies, traded at 77.264, compared to 77.364 before the report and up from 77.255 in late North American trading on Thursday. The euro fell to $1.3910, from $1.3888 earlier and versus $1.3939 late Thursday.

NEW YORK (MarketWatch) — The euro will rise to $1.46 at the end of 2010, Morgan Stanley said Friday in raising its forecasts for the shared currency. It previous expected the euro to trade at $1.36 by December, according to Ron Leven, senior currency strategist at Morgan Stanley. The euro recently fell about 0.4% to buy $1.3877. By the end of 2011, though, the dollar will recover and push the euro towards $1.32, according to the firm, compared to its previous forecast that the euro would fall to $1.24 by then.

NEW YORK (MarketWatch) — Pilgrim’s Pride Corp. said Friday that third-quarter earnings were $58 million, or 27 cents a share, compared to $83 million, or $1.07 a share, in the same period a year ago. Sales were steady at $1.7 billion for the Greeley, Colo. chicken processor. Analysts polled by FactSet Research estimated, on average, earnings per share of 18 cents and sales of $1.76 billion.

NEW YORK (MarketWatch) — The Canadian economy grew at a 0.3% pace in August, following a 0.1% decline in July, the government reported Friday. Oil and gas extraction, wholesale trade and manufacturing were the main sources of growth, Statistics Canada said. The U.S. currency turned lower against the Canadian dollar after the data, falling 0.2% to buy $$1.0182. The greenback has risen as high as C$1.0247 earlier.

NEW YORK (MarketWatch) — The dollar pared its gains and Treasury prices rose a little more on Friday after a report showed the U.S. economy grew at a 2% pace in the third quarter. Yields on 10-year notes , which move inversely to prices, fell 4 basis points to 2.63%. The dollar index , which measures the U.S. unit against a basket of six major currencies, traded at 77.393, compared to 77.516 before the report and up from 77.255 in late North American trading on Thursday. The euro fell to $1.3882, from $1.3857 earlier and versus $1.3939 late Thursday.

WASHINGTON (MarketWatch) – The U.S. economy had a small acceleration in the third quarter as consumer spending picked up, the Commerce Department reported Friday. Real gross domestic product rose at a 2.0% annualized rate in the third quarter, up from a 1.7% increase in the second quarter. The big story for the third quarter was in the consumer sector, where spending rose to a 2.6% rate, the fastest pace since the fourth quarter of 2006. Business spending slowed in the third quarter and housing was a drag. Inventories added to GDP growth while trade subtracted from growth.

EU leaders early Friday agree to tighten the fiscal rules governing the union in an attempt to avoid a repeat of the Greek shock that nearly toppled it earlier this year. They also decide to flesh out a permanent mechanism to handle the risk of default.

TOKYO (MarketWatch) — Sony Corp. said Friday strength in its personal-computer and game business, as well as cost cuts, helped it post a 68.65 billion yen ($847 million) operating profit for July-September, reversing a year-ago loss, and upwardly revised its full-fiscal-year outlook. The Networked Products & Services segment, including the game business and PCs, contributed “significantly to the improved consolidated operating results,” Sony said, “despite unfavorable foreign-exchange rates.” For the full year through March 2011, Sony raised its profit forecast to ¥200 billlion from ¥180 billion.

3:09a GMT Update: Pair jumped 25 pips up and then 30 pips below the pennant formation, as you would expect anytime you see a consolidation with tightening volatility. Challenging 1.3900-1.3880 support right now.

Daily Outlook: How is this for an early signal? We have some clear formations developing on the charts right now and I thought you would want to know about it BEFORE  any action happens rather than AFTER. Plus there are lots of good setups to be had in the trading plan for today :).

Specifically we have a bullish pennant developing on the 1h charts. A bullish pennant is a continuation pattern and since the flagpole is bullish than the continuation pattern is also bullish. 1.3950 is the breaking point I am watching for this formation, with a break above opening up a challenge of 1.40 and maybe even 1.4050 (which I would short). On the 30m chart it is hard to say if it looks more like a flag or a pennant but the analysis is the same – short term bullish.

As always CandlePro users can check multiple pairs/timeframes for intraday candlestick signals and you should watch out for news events on the forex calendar.

Trading Plan: There are lots of setups to be had with a formation like this, but the primary will be a standard breakout trade: if we see the north side of 1.3950 then I will long with targets at 1.3970, 3995, 4020 and 4045 for 95 pips. Notice the second target is beneath 40? Strong resistance expected there and a high probability I will close and reverse.

This also leaves an aggressive short open if we see a false breakout above 3950 or even a sustained break below 3900. In these cases I will target down in 25 pip chunks down to 3775 for almost 200 pips.

Another aggressive trade would be a long at the bottom of this pennant, say 1.3920 (this will change as pattern continues). First target should be 1.3940-3945 area as another challenge of 1.3950 with this type of pattern is a pretty high probability event. (scalper alert!)

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WASHINGTON (MarketWatch) — General Motors announced Thursday that it was buying back $2.1 billion in preferred stock from the Treasury Department as part of a series of steps to reduce leverage. The purchase is conditional on completion of GM’s public offering of common stock. GM said it has repaid $2.8 billion to the United Auto Worker Retiree Medical Benefits Trust and has finalized a $5 billion five-year revolving credit facility. After the offering, GM said it would contribute at least $4 billion in cash and $2 billion in common stock to GM’s hourly and salaried pension plans. GM said it also expects to end a wholesale advance agreement with a bank which dealers used to borrow to fund inventories. This will result in an estimated $2 billion increase to GM’s accounts receivable balance, on average, depending on sales volume and other factors, the company said.