I have been talking about this a lot, I know, still i do believe will play a big role in currency markets. I went to Wikipedia to find a definition of deflation, and it says:” is a decrease in the general price level of goods and services Deflation occurs when the annual inflation rate falls below zero percent (a negative inflation rate), resulting in an increase in the real value of money - allowing one to buy more goods with the same amount of money”, and it also says “deflation is also linked with recession, and  prevents monetary policy from stabilizing the economy because of a mechanism called the liquidity trap” (in two words, a liquidity trap is falling into a spiral that leads to monetary policy  unable to stimulate the economy).

Anyway, deputy Prime Minister Naoto Kan said Friday that the Japanese economy has slipped into a state of deflation, putting BOJ under pressure to take country out of it. You can read the whole article following this link: http://mdn.mainichi.jp/mdnnews/news/20091120p2a00m0na015000c.html

But the unspoken word in Europe, should start to be taking into account: as reported by the Federal Statistical Office (Destatis), the index of producer prices for industrial products (domestic sales) for Germany fell by 7.6% in October 2009 from the corresponding month of the preceding year. In September 2009, the annual rate of change was -7.6% too.
Same data  for euro zone show that in September 2009 compared with September 2008, industrial producer prices dropped by 7.7% in the euro area and by 7.3% in the EU27 (these figures come from Eurostat, the Statistical Office of the European Communities). I will stop here with stats not to make anyone crazy, yet we are at -7.6% and -7.7%.

I  won’t be extending with any Keynesian theory of economics, I will just ask you, what should happen both with Euro and Japanese Yen?

Yesterday I was laughing alone at home as several news services where publishing a big banker from Saudi Arab was saying that is true American economy is in bad shape, but so are all the rest. Exactly the same i have been saying for the last 3 months.

Anyway, as I also say, we should trade what it is, and not what we think it should be. At current levels, and from a technical perspective, there is no signs of change in both Yen and Euro bullish trend. Although is too late to get into them, is still too early to go against.

Ok! enough philosophy for one morning! too early to think this, really! I will start now with the more humble intra-day technical views. Enjoy!

Hi everyone and welcome back to this blog. Majors are barely changed from past American session close, as well as gold, quoting where I left it at the beginning of Asia at $ 1144/oz. Yesterday’s strong risk aversion run triggered by stocks and commodities, had not enough strength to follow trough, particularly in European majors, as both stocks and commodities managed to bounce back. With no much macroeconomic data for today, but a couple of speeches, for CHF and EUR, seems market will again depend on stocks and gold to find a direction. Anyway, I will add more technical stuff today, as my younger girl don’t let me sleep (is 5 a.m. in Buenos Aires) and better do something useful if i’m up right? Here is the link for today’s calendar:

http://www.fxstreet.com/fundamental/economic-calendar/

Have a great day!

Hi everybody and welcome back! One day off and things are not quite the same in market: despite gold reached 1153 past Wednesday, EUR/USD failed again to break above 1.5000, a level that refuses to give up since past Thursday. Pound Also retreat from the 1.6840 area,   50% of the monthly fall (I will place my big charts later today). Both stocks and gold retreat strongly today, favoring some dollar  winnings, still nothing really important, more likely corrective, as we remain in past week trading range. Market is waiting for another big trigger to define further trends, and i don’t see anyone for this week, at least from the fundamental side. Maybe  gold recovering the highs and attempting a fresh one, won’t be so strong dollar bearish trigger, as gold breaking under 1080 will be favoring greenback. Let’s see the charts, and try to find some clues! Here is the link for today’s calendar:

http://www.fxstreet.com/fundamental/economic-calendar/

Have a great day!

Better than expected U.S. unemployment data, showing unemployment clains fell y 12K to 502K. halted dollar rally, sending stocks slightly up, at a first reaction. Let’s see if it holds.

USD/JPY  is above 90.00 after ranging in 50 pips for two full days. We need a clear break aove 90.30 to confirm furhter rises there.

Hi everyone, and welcome back. Dollar fall in early Asia as stronger-than-expected Australian jobs data for October encouraged investors to buy riskier assets, including gold that rose to the 1120 level. Yet the downside turn in stocks halted greenback bearish rally, and the currency extend yesterday’s recovery in early European session: both Euro and Gbp had printed lower lows, and remain slightly bearish at this point. First data of the day, euro zone industrial production, come under expectations at 0.3%, another negative report for Europe. Also, U.S. Treasury Secretary Timothy Geithner reiterated U.S. support for a strong dollar, yet recon it will take some time to bring unemployment down.

 Anyway, we have some news to take care of, let’s see if dollar can extend the rally trough next levels, triggering more profit taking among not so confident investors. Here is the link for today’s calendar:

http://www.fxstreet.com/fundamental/economic-calendar/

Have a great day!

Hi everyone and welcome back! as commented on the last post,record highs in gold (I will be making a separate post for it with charts) keep pushing dollar down against major rivals, as also U.S. futures are at fresh year highs. Euro rose to 1.5045, and retreats a bit, while at this very moment Pound is falling big,thanks as usual, to Governor King comments. We have a holiday today both in the U.S. and Canada, so I will take a time to look at bigger time frames and prepare an educative webinar.

Have a great day!

Hi everybody, and welcome back! Dollar remains weak across the board, after yesterday’s Central Banks decisions, more due to a healthy risk appetite than data, as stocks and gold keep rising as there was no roof for them. Anyway, and ahead of the U.S. NFP report, greenback continues losing ground.

Regarding Nonfarm payrolls, we know, that usually a good dollar report trigger a stocks rally, sending greenback down, while a bad ready has the oppositeeffect. USUALLY. L believe we are going to follow that path today, but remember one day, a good dollar reading will mean dollar strength. If that day is today, is something I can’t assure.  Just pay attention to market and take a breath before taking a trading decision. Good luck all!

Here is the link for today’s calendar:

http://www.fxstreet.com/fundamental/economic-calendar/

Have a great day!

Hi everybody and welcome! Sorry for the lack of post yesterday it was a technical issue with the blog editor. I couldn´t make it work! I have been doing however the usual reports. Anyway, here we are back with dollar down against major rivals, after the FED decide to hold rates and the “extremely low, for an extended period” stance. Eur/Usd reached 1.4900, Gbp/Usd 1.6600, from where both retreat a bit, waiting for next ECB and BOE decisions. Stocks rose on the positive outlook of the economy, while gold keeps trying to reach the 1100 level.

Early data show some improvements in the U.K. with Industrial Production above expectations, while Retail Sales in the eurozone fell again, this time -0.7%. However majors are almost with no reaction: market players don’t dare to risk positions a couple of hours before statments, so seems we  will have to wait to see some definitions for today. Here is the link for today’s calendar:

http://www.fxstreet.com/fundamental/economic-calendar/

Have a great day!

Hi everyone, welcome back. As warned in last post, gold breaking higher changed all: dollar recovery against major rivals dilute quickly, and majors run higher, leaded by Gbp that reached the 1.6450 area, while Euro regained the 1.4700 level to stay. Commodity currencies also printed a strong recovery that extends early Europe as gold keeps approaching to $ 1100/oz. Ahead of FOMC, dollar could weak further if the FED maintain it’s “exceptionally low, for an extended period” stance regarding rates. Yet day is still young, let’s see what technicals have to say. Here is the link for today’s calendar:

http://www.fxstreet.com/fundamental/economic-calendar/

Have a great day!

Early to say, a warning in forex trading is always welcome and needed. Despite the strong movements we are seeing in market, we should not forget we have FOMC, ECB and BOE decision next Wednesday and Thursday ( i will be covering all live! at Fxstreet.com home page), and U.S. Non Farm Payrolls next Friday. Long term definitions will be confirmed (or not) by the end of the week.