US Dollar at a Crossroads: Further Gains or Finally a Pullback?
Euro: ECB Decision a Write Off, Financial Troubles the Real Threat
Japanese Yen Could Remain Directionless Despite Week Of Event Risk
British Pound Selling to Continue on Interest Rate Outlook
Swiss Franc Torn Between Major Trends in Other Currencies
Canadian Dollar to Face 4Q GDP, Bank of Canada Rate Decision
Australian Dollar Could Snap Back to Trend with an RBA Surprise
New Zealand Dollar Forecast to Track S&P 500’s Every Move

Go to Source

•    Euro Regains Some Lost Ground, though the ECB and Greece will Keep the Currency Under Pressure
•    Pound Extends its Plunge despite Positive Growth Revisions and Improved Sentiment
•    Australian Dollar Could Extend its Lead Over its Peers with an RBA Rate Decision and 4Q GDP

Go to Source

Our British Pound short position has met its initial objective and we have revised the profit target lower to 1.50. We have also added a short Australian Dollar position  and remain short the Euro and long the Yen against the US Dollar.

Go to Source

 The yen regained its footing in late trading as equity markets gave back earlier gains. Caution remains in the air with the outlook for growth dimming and the troubles in Europe. A week of major event risk is ahead which could lead to wild fluctuations in risk sentiment and the yen as well. The Asian currency has seen its correlation with risk grow as traders have started to favor the yen over the dollar as a funding source for riskier investments.

Go to Source

 A week of rate decisions, quarterly GDP reports, US employment figures and a number of other significant releases offers the potential for a great deal of volatility. The two central banks that have the greatest potential for altering monetary policy will convene this week in the RBA and BoE which could initiate new trends in their crosses and should garner the focus of markets. Employment and manufacturing data from the world’s largest economy 

Go to Source

 Just 24 hours ago, crude was pitched into its sharpest decline in three weeks; and the bullish trend the commodity had carved for most of the month seemed over. However, in a sign that recent high levels of volatility do not have an outlet in the form of a clear trend; the commodity would reverse most of its losses through Friday and position the market back within a broad range between $80 and $77.50.

Go to Source

Mortgage approvals in the U.K. are expected to fall to 50.0K in January following the unexpected decline in the previous month, and the data could weigh on the exchange rate as policy makers continue to see a risk for a protracted recovery.

Go to Source

The fundamental storm underlying the financial markets is building, yet the anchor on sentiment is holding fast. While this divergence between the primary health of the markets and the prevailing asset levels is remarkable, it is not altogether unusual.

Go to Source

Extreme weakness in the pound has catapulted EUR/GBP higher. After weeks of moving sideways below the 200 SMA, EUR/GBP has closed above that very much watched moving average. I would not chase it here but look for some kind of retest of the .8873 breakout area. Though Stochastics has crossed over into overbought territory, EUR/GBP could continue to move a several hundred pips while this indicator is in this area. The inability of the EUR/GBP to get and stay below the key .8700 level bodes will for a bullish trade. 

Go to Source

SP 500 Futures: Strong rally off the lows yesterday, and the volume into the close was strong to the upside. Still the weakness in the background that we outlined Wednesday, so it has to get through this 1105 to 1115 resistance zone to really avoid weak…
Go to Source