The deficit on trade in goods in the UK expanded to 9.2 billion

The deficit on tradeGoods trade deficit UK has increased more than expected in May, official data showed on Thursday.

A report by the Office for National Statistics said that the deficit in trade in goods of the country has widened to a seasonally adjusted 9.2 billion pounds in May from 8.81 billion in April. Economists had expected the deficit in trade in goods to decline to 9.0 billion

Seasonally adjusted deficit of UK trade in goods and services was estimated at 2.4 billion in May compared to 2.1 billion in April.
Deficit of 9.2 billion pounds for the goods was partially offset by a surplus of 6.8 billion on services.

In May 2014, exports of goods increased by 0.1 billion to 24.1 billion pounds, while imports of goods increased by 0.5 billion to 33.3 billion as a result of the increase in the deficit on goods by 0.4 billion. Increase in imports of goods is attributed to the aircraft.

Meanwhile, reports from early morning showed that French industrial production unexpectedly fell last month to -1.7% from 0.3% the previous month. Analysts had expected the French industrial production to rise 0.5% last month. In a report, you Istat reported that industrial production in Italy has fallen to -1.2% from 0.5% in the preceding month whose figure was revised down from 0.7%. Analysts had expected the Italian industrial production to rise by 0.6%.

Go down the release of UK data reported losses sterling against the dollar as GBP / USD fell to 1.7118.

Meanwhile, European stock markets went down. London’s FTSE 100 moved down 0.15%, DJ Euro Stoxx 50 dipped to 0.75 percent, the French CAC 40 fell 0.6%, while Germany’s DAX fell by 0.55%.

BITCOIN Forex currency trading REVIEWED

Bitcoin has emerged as one of the hottest investments around. Now, as Bitcoin trading is constantly on the evolve, it is also being linked on top of another hot investment market, Forex, involving the trading of currencies. While Bitcoin itself aims to become a currency, there are a few important differences between Bitcoin trading and traditional Currency trading.

Forex currency trading refers to the trading of currencies. Inside a globalized world, companies and organizations have to be able to quickly exchange currencies in order to facilitate global operations and purchases. A sizable company like Kenmore can have operations in literally a large number of countries. This means that Kenmore has to be able to quickly access various currencies in order to pay local staff and make purchases, amongst other things.

The foreign exchange market could be the largest and quite a few liquid investment market on the globe. The majority of the traders are large institutions, corporations, and governments who conduct trading to facilitate their various operations. Some investors, however, also exchange Forex using the goal of making money away from fluctuating fx rates.

Currencies are traded in pairs. Because of this one currency is exchanged for an additional. So USD/Euro and Euro/USD identifies two separate trading pairs. The very first currency refers to the “base currency”, which means that USD will be the currency being bought, and Euro could be the currency being sold. From the USD/Euro pair, you use Euros to get dollars. If you use Euros to acquire dollars, you’re essentially betting the dollar with surge in relation to its the Euro, along with the Euro will likewise fall.

Forex is known as a far more stable market to put money into. Foreign exchange rates generally move very slowly in support of change at moderate paces after a while. While traumatic world events, for example the collapse of an national economy, or possibly a major financial crisis, could cause exchange rates to rapidly move up and down, more often than not currencies remain quite stable in comparison with other investment vehicles including stocks.

Investors, however, generate profits away from fluctuations in markets. Generally, greater volatile prices with an investment are, the greater opportunities there are to generate and throw money away. This is the reason Bitcoin Forex trading is now more popular then ever. At the moment, the volume of speculation and amount of concerns (i.e. security, government intervention) around the currency imply that Bitcoin cost is highly volatile. As a result Bitcoin a smart investment vehicle more just like stocks, commodities, along with other highly speculative investments – passing it on the ability to gain larger profit (and loss).

Most Forex trading is finished through dedicated Bitcoin exchanges, such as MtGox, which allow you to “buy” Bitcoins. Forex currency trading is different from a conventional Bitcoin exchange because it can be non-executable and you also buy Bitcoins in pairs. Which means you can’t simply withdraw your Bitcoins and use the crooks to make purchases. Instead, you purchase a financial tool(a currency pair).

Some Forex brokers have started to acquire associated with BTC and therefore are starting BTC pairs comparable to those entirely on same old Forex platforms. Like other trading pairs, a Forex pair will allow you to exchange Bitcoins regarding other currencies. Which means that you can actually profit off of the rise in the need for BTC along with the stop by the need for the usa dollar.

Popular BTC \ Forex trading businesses that supply CFD services include Plus 500. Many world’s largest Forex brokers, has added BTC towards the conversion tool but has thus far declined to make Bitcoin a tradable currency. Still, the mere proven fact that Oanda is engaging with Bitcoin is nice news and adds credibility on the currency. When trading CFDs your capital could possibly be at risk. This process of trading would work for skilled traders.

Forex trading strategies

If you hear from anybody that making money in Fx is straightforward, do not believe it. It is a fable. The real truth is being worthwhile in Forex calls for a whole lot of function, dedication, practice, far more than a great discipline, sharp expertise of money administration and comprehending of the psychology of the forex market place. Not so minor and therefore not so straightforward.
Investing is not a gambling by guessing exactly where the value will move, though there are a lot of traders (primarily novices) that are exactly gambling. Buying and selling currencies on the Foreign exchange marketplace demands logical and analytical calculations based either on forex trading strategies or specialized assessment of cost moves.
Generating money begins with a program to make money. This kind of program is of tremendous importance when it arrives to trading international currencies. But, in addition to producing a prepare, a trader requirements constantly adhere to it. How often trader breaks his rules will have an effect on how much cash he will make trading Forex trading. Seems simple: produce and stick to… Nonetheless, there is an actual obstacle when trader follows the rules but principles are unsuccessful to make funds… it transpires inevitably for each and every trading technique acknowledged. If method experienced established to be successful, sticking to the investing strategy and firmly next the principles even when dropping funds will eventually generate lucrative outcome. Getting powerful buying and selling self-control and getting losses when required are a sign of severe trading technique.
To earnings in Fx sticking to a established of guidelines is not adequate. Good money administration is also essential. Knowledge of how significantly to trade per each and every open place and the place and when to quit is what separates productive trader from bankrupt trader. Several rookie traders in excess of-leverage themselves getting attracted by massive and promising leverages offered by Fx brokers. The truth is that a huge leverage is not only about a massive acquires, but also when it will come to be so a big reduction. Leverage larger than 1:20 will not draw in critical investors.
Know your losses, prior to counting profits
Opening a new investing placement need to be 1st of all about how considerably funds could be dropped and then what would be the profits. Excellent funds administration suggests that trader is anticipating getting at least two times as much as he could lose on every single trade. This way getting right only fifty% of the time will nevertheless make investing profitable.
Employing very good funds administration in Forex trading is hundred occasions more essential than obtaining any excellent investing system alone.

EUR/USD Held Under 1.30

 

EUR/USD has been rallying all week, but found resistance Friday 1/20, under 1.30, at 1.2990. Looking at the 4H chart, the reaction here so far respects the 200 4H simple moving average after cracking a declining channel resistance as well as the 23.6% retracement of the decline from 1.4246 to 1.2623. The RSI also reflects establishment of bullish moment that should at least flatten the bearish outlook it has had since Nov. 2011. In the very short-term, the rejection under 1.30 with a strong bearish candle seen in the 4H chart suggests a throwback before continuation.

Even though we had a strong reaction under 1.30, the momentum seen in the 1H chart still holds bullish as the RSI failed to break below 40. Also price is still trading within the rising channel, respecting support so far. A rally above 1.2950 would break above 61.8% retracement of today’s dip and would make the case for bullish continuation earlier without breaking below channel first. This can be confirmed if the 1H RSI reading also rises back above 60. The 1.30 level will likely be tested in this scenario.

For the short-term bearish outlook, a break below channel support, and a break of RSI below 40 in the 1H chart will be signs that the initial rejection is following through with further corrective decline.

Euro striken by BIG debt crisis

SYDNEY, July 12 (Reuters) – The euro struggled to find any friends in Asia on Tuesday, having hit a record low against the Swiss franc as doubts lingered even after European financial officials offered fresh steps to tackle the region’s sovereign debt problems.

In a bid to stop financial contagion engulfing Italy and Spain, officials promised to provide cheaper loans, longer maturities and a more flexible rescue fund to help Greece and other EU debtors.

They declined to rule out the possibility of a selective default by Greece, a move officials said bolstered Germany’s push to involve investors in easing Greece’s debts despite the concerns of the European Central Bank.

European Union finance ministers meet later on Tuesday and are under the cosh to soothe market nerves ahead of Thursday’s Italian bond auctions. Italy is aiming to raise 7.75 billion euros in the debt market, according to estimates from Barclays Capital.

“All we have right now are headlines about possibilities. I don’t think what we’re seeing now in the market is going to stop until we see action. If it’s aggressive enough and large enough, then it could possibly do the trick,” said Michael Feroli, chief U.S. economist at JPMorgan in New York.

The euro was last at 1.1732 Swiss francs , having plumbed a record low around 1.1670 francs. Against the yen, it stood at 112.66 , not far off a four-month low around 112.27 plumbed overnight.

Versus the dollar, the common currency hit a seven-week low around $1.3985 before recovering a bit of ground to last stand at $1.4030 .

A break below the May trough of $1.3968 would take it back to lows not seen since mid-March. Support is seen around $1.3905/10, a level representing the 50 percent retracement of the January-May rally as well as the 200-day moving average.

Weakness in the euro helped push the dollar up against a basket of major currencies. The dollar index climbed to 76.156, the highest in seven weeks. It was last at 76.000.

The greenback also advanced against commodity currencies. The Australian dollar , for example, skidded to two-week lows around $1.0632, down some 1.5 percent from last week’s highs near $1.0800.

“We are becoming cautious on the prospects for AUD due to the increasing evidence of a global slowdown,” analysts at Societe Generale wrote in a note.

USD/NOK Still Dropping While USD/SEK Setbacks Remain Well Supported


Usd/SekRemains under some intense pressure with the market trading at fresh yearly and multi-week lows by 6.25. However, with daily studies looking stretched, there is the risk for some corrective upside ahead. Ultimately, the market will need to break back above 6.42 to officially alleviate downside pressures. A close back below 6.25 negates.

Usd/Nok The market remains under pressure and has once again dropped to fresh multi-week and yearly lows below 5.45. However, despite the latest pullback, we actually favor buying below 5.50, with the market seen very well supported by current levels which had already provided a successful defense back in 2009. Daily studies are also looking stretched, and this helps to add to bullish reversal prospects. Back above 5.52 confirms and should accelerate. Below 5.40 delays.

Eur/NokWe are finally starting to see the formation of a potential base in the cross after the market has once again stalling out by the 7.70 handle. The latest break back above 7.80 confirms and exposes 8.10 further up. Only a weekly close back below 7.70 ultimately negates recovery, while intraday setbacks should be well supported above 7.75 on a close basis.

Eur/SekThe market recovery out from 8.70 continues and we look for a fresh higher low to now be in place at 8.85 ahead of the next upside extension beyond 9.03 and towards the 9.10-15 area further up. Weekly studies are looking even more constructive potentially with the formation of a major base.

Australian Dollar High-Yield Proxy for Gold

Forex correlations to the S&P 500, Gold, and Oil prices continue to trade near record peaks, and currencies such as the high-flying Australian Dollar offer good proxies for trades in other financial asset classes.

The AUDUSD continues very closely linked to Gold, the S&P 500, and broader hard commodities prices. The fact that the currency likewise offers the highest short-term yield of any G10 currency means that Australian Dollar longs seem more attractive than the equivalent Gold or low-yielding S&P 500 position.

Forex correlations remain strong across the aboard, and this is nowhere more clear than the Japanese Yen. The FX carry trade-linked currency had previously lost its link to broader ‘risk’ as it slowly trended higher against the US Dollar despite S&P 500 gains. FX traders seem once again confident enough to pile into JPY-short positions amidst bullish risk sentiment. Indeed, it seems the JPY carry trade is alive and well through the recent ‘risk’ rally.

Dollar Finds a Lack of Support for the Early Shift in Rate Speculation from the FOMC

From the economic docket Tuesday, it would have seemed that there was a greater potential for dollar-based volatility – though how far such event risk could reach was limited. The FX market is one of a million different variables; but there generally only a few particular catalysts that influence price action at any one time. Through the past day’s session, service-sector activity data and the minutes from the FOMC’s last rate decision were on hand to encourage price action; but neither of these catalysts genuinely shift the market’s larger concerns – underlying risk appetite trends and relative yield potential. That said, the lack of a true drive for the greenback exposed the currency to cross-market activity; and there was plenty of that. From the risk side of things, the lack of follow through on the S&P 500’s decelerating advance led AUDUSD to fall back a second day and NZDUSD to restrain its gains. Alternatively, a consistent drop from the Japanese yen pushed USDJPY to a fresh six-month high. Perhaps most remarkable though was GBPUSD. A dramatic rally from the sterling triggered the biggest rally from the ‘cable’ since January 12th. And, then there was EURUSD. The most liquid currency pair in the market (and the foundation of the Dollar Index) made no remarkable progress for the seventh consecutive day. In fact, the average true range on this pair (an indicator of trend and activity) dropped to its lowest level since September with Tuesday’s close.

Considering the fundamental trends we have been following these past weeks, we shouldn’t be too surprised by the day’s lack of progress. To truly encourage the greenback beyond a breakout and on to a true trend would require either a momentous shift in risk trends or yield potential. Investor sentiment is anchored, which actually allows for a slow drift higher for capital markets on the recovery from the mid-March, Japanese-based crisis. Alternatively, there was potential in the release of the Fed’s wrapup from the last rate decision. Had we seen an unambiguous call for higher rates in the immediate future; the dollar would likely have taken off on a remarkable rally. Yet, such surprises don’t often come from a US central bank that is playing stabilizer and liquidity provider for the global market. That said, there was notable highlights that support the shift in tone that we have read from many Fed officials. While most would consider the suggestion that “almost all” of the participants at the meeting decided there was no need to tapper the QE2 asset purchasing program a sign that tightening is still far off; the reality is this suggest there is some level of dissent, where before it seemed a nearly unanimous consensus. Far more interesting though was the assessment that the group was divided over tighter monetary policy in 2011. The mere mention of this contention reflects an effort to remain transparent and the growing voice for action. Should the hawkish call grow, we will see expectations of a 4Q hike grow and the dollar rise well in advance of the actual move.

Source of the article

Euro Rally only Temporary

Something incredible has happened: The Euro has reversed is 16.5% decline (from peak to trough), and since bottoming on June 7 at $1.1876, it has risen by an impressive 4%. I guess that means the Euro has been rescued from parity (which I characterized as “inevitable” on June 5)?
Not exactly. While financial journalists have interpreted this as a recovery in risk appetite, and mainstream investors dismiss all of it as mundane fluctuations in exchange rates, currency traders – both fundamental and technical – know better. They know that this rally is merely a correction, the product of the Euro falling too much too fast against the Dollar and a consequent short-squeeze. They know that there is nothing underpinning the Euro rally, and that since the bad news continues to emanate from the Eurozone, a further decline is inevitable. ” ‘We could be one or two headlines away from a crisis again. This problem didn’t occur in a couple of days, nor is it going to resolve itself in a couple of days,’ ” summarized one trader.

According to Brown Brothers Harriman, ” ‘The recent euro rally is a corrective phase in a bear market and not a change in trend.’ National Bank Financial added, ” ‘Ultimately, when the market is this short a particular currency and a pullback happens, it results in some price volatility. It doesn’t necessarily reverse the longer-term trend.’ ” Given that so-called net-short bets against the Euro rose to a near record high in the beginning of June, it was inevitable [to borrow my favor word of the moment] that traders would eventually “cut positions when momentum in a currency [the Euro] shifted.”

From a fundamental standpoint, the last two weeks have brought further indications that the crisis is still mounting. The credit rating on Greek sovereign debt was cut to junk (A3) by Moody’s, following a similar move by S&P in the spring. Fitch, while arguing that the Euro has already declined “too far” is simultaneously threatening to do the same.

Meanwhile, Spain managed a successful debt auction, but at interest rates nearly 1.5x what it had to pay the last time around. Still, it’s in a more favorable position than Greece, which is now paying a yield premium of more than 600 basis points on its debt, compared to Germany. The implications for currency markets are clear enough: “There is a little bit of a disjuncture between what the currency is doing and what these bond markets are doing, and that’s a problem for the euro.”

Politicians, for their part, are still struggling to convince investors that they are serious about trimming their budgets and uniting for the sake of the Euro. “I see good news from the current euro-dollar rate, French Prime Minister Francois Fillon told reporters…’and I have been saying for years that the euro-dollar rate didn’t reflect reality and was penalizing our exports.’ ” With comments like that, is there any cause for believing them?!

Even putting politics and economics aside, there is a force that will continue to punish the Euro regardless of what happens: the carry trade. According to the WSJ, there is “some evidence that investors are indeed using euros to finance their bets. That is important because it means there may be structural reasons in the investment world why any lift in the euro will simply be quashed.” Thanks to the promise of continued low interest rates and confidence in its decline, ” ‘The euro is the clear-cut funding currency of choice.’ ”

At this point, then, the only issue is when the Euro will resume its decline. Those with a technical bend think that the Euro will fail to breach a psychologically important level (perhaps $1.25 or $1.27) after exhausting the rest of its momentum, at which point it will resume its precipitous decline. Those who see things in fundamental terms argue that when this happens, it will likely be due to more bad news about the crisis and/or a recovery in risk appetite (the contradiction between the two notwithstanding).

No US Rate Hike in 2010

In the midst of the Eurozone debt crisis, forex investors have largely stopped paying attention to interest rate differentials and focused the brunt of their attention on risk. Soon enough, however, there will be a resurgence in the carry trade, at which point interest rates will return to the forefront of investors consciousness.

From the standpoint of the carry trade, the US Dollar should be one of the least favorite currencies, since it offers investors a negative real return (without taking exchange rate fluctuations into account). If not for the sudden increase and volatility and consequent ebb in risk appetite, the Dollar would probably still be falling, and would continue to fall well into the future. To understand why, one need look no further than the current Fed Funds Rate (FFR), from which most other short-term rates are (indirectly) derived.

The FFR currently stands at 0 -.25%. Moreover, the debt crisis could potentially hamper the US economic recovery and the appreciation in the Dollar is causing inflation to moderate, which has removed almost all of the impetus for the Fed to hike rates anytime soon. There is also the problem of high US unemployment and recent stock market declines. There is currently a tremendous amount of uncertainty, as nobody can say definitively whether the US economy has turned the corner or whether it is headed for double-dip recession.
FED 2010 Rate hike monetary policy

Most at the Fed think that the US recovery still remains on track. According to Federal Reserve Bank of Chicago President Charles Evans, “As the recovery progresses and businesses become more confident in the future, employment will increase on a more consistently solid basis. My forecast is that real gross domestic product will grow about 3.5%.” In fact, some of the hawks at the Fed see this as a justification for preemptive rate hikes and/or an unwinding of the Fed’s quantitative easing program. The President of the Kansas City Fed argued recently, “Even if the target was increased to 1 percent, policy would remain very accommodative,” while the Philadelphia Fed President added that the Fed should start selling some of $1 Trillion in Mortgage Backed Securities currently on its balance sheet.

Still, such voices represent the minority, and besides, most of the hawks don’t current have any voting power. In other words, it will probably be a while before the Fed actually hike rates. Futures contracts currently reflect an infinitesimally low probability of rate hikes at any of the Fed’s summer meetings. “The February 2011 fed-funds futures contract priced in a 48% chance for the FOMC to lift the funds rate to 0.5% at its Jan. 25-26 meeting.” Meanwhile, an internal Fed analysis has concluded that based on previous rate-setting patterns, it is unlikely that the benchmark FFR will be lifted before 2012.