Forex Investment and Currency Trading

Warning signs are beginning to develop suggesting the USD may continue to surprise to the upside. This week’s closing price on EURUSD will be important in determining which way the next significant directional move will be. Certainly in the short term, markets are correcting their longer term trends.

EURUSD: A weekly close this week below 1.5658 would mean a bearish weekly reversal will be posted.
USDJPY: 104.95 remain the important short term resistance level.
GBPUSD: Beginning to look dangerous like EURUSD
USDCHF: Break to the upside.

This is, to a large extent, a reflection of the significant developments taking place in the Fixed Income and [...]

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Overall: FX was relatively quiet overnight as were equity markets while fixed income remains choppy. This fixed income price action still smacks of a position squeeze (like seen in March-June last year) rather than a structural development. Commodities overall remain choppy but bid.
FX: Quiet overall although the AUD continues to perform very well. EURGBP holding 76.4% pullback level.
Commodities: Copper looks poise for medium term gains. Keep an eye on Wheat it looks heavy as does Corn. Time for sugar to be a sweet trade????
Equities: DAX looks to be struggling again.
EM: USDILS at pivot point.

AUD USD
Looks more and more like a [...]

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Currency
The USD has held to reasonably tight ranges last week despite FOMC Minutes and key rate decisions by the ECB and BoE. However, the underlying economic performance appears to have deteriorated sharply in March, suggesting additional Fed easing late this month. With other central banks focusing on inflation risks, the prospect remains strong for new lows for the USD Index during the weeks in the run-up to the April 30 FOMC meeting.
The ECB maintained its hawkish stance with commodity prices maintaining concerns about future inflation risks. From a technical perspective, EUR/USD established a potentially important triple-top just above 1.59 [...]

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USD/CAD – Support at 0.9940 and 0.9724 is expected to attract buying interest for a return to 1.0343. USD/CAD remains locked in a broad 0.9700-1.0400 trading range as overbought conditions caused the rejection of the top end of the range two weeks ago. A base building processis is underway, with support at 0.9940 and 0.9724 expected to attract buying interest for another test of resistance at 1.0343. Adaily close above this level would resolve the consolidative rectangle pattern to the topside, targeting 1.0468 and 1.0653 thereafter. Target remains located at 1.0335.
EUR/USD – Close above the cyclical high at 1.5905 would favour greater [...]

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