I’m condensing everything into one post today so be prepared for lots of different info coming at you all at once. 😀
So, today’s market has been quiet and for the most part, uneventful…to say the least. It hasn’t been easy pinpointing exactly where things may be headed for the rest of the week.
USD/JPY, which has been on an upward move since early Monday has seemed to have lost some of its steam. Looking back to February 5th when the pair began its ascent, I see that it rose approximately 8.4 points from roughly 89.30 to 97.70( 12:20pm PST, 2/25/09), which is equivalent to just about 840 pips. It’s pulled off 1/2 of that progress in the past 2 1/2 days so it is no wonder that the pair is back to a slow-moving pace. Take a glance at the chart below:
As for the best move of the day, it would go to GBP/USD which dropped a whopping 350 pips overnight from 12am – 10/11am PST. The pair had ‘bounced up’ for 3 days(Thursday 2/19, Friday 2/20, and Sunday 2/22), went sideways on Monday and Tuesday, and today completely retraced and sold off the move it made on the previously mentioned ‘bounce’. See retracement below(notice my labeling/indications of where the bounce happened and when the tide changed to the downside today):
Now moving on to economic data from today and the previous days of the week(in descending order) :
2/25/09: U.S. existing home sales have fallen unexpectedly in January by 5.3 pct to 4.49 million. This is the lowest amount of purchases made since 1997. The median price for homes is now at $170,000, down about 15% since last year. It was projected that sales would be up from the 4.74 million existing home sales of December to 4.79 million in January but instead sales declined dramatically(as stated above).
The U.K. economy has shrunk to its lowest point during last year’s 4th quarter since 1980. GDP declined 1.5 pct from the 3rd quarter due to company and consumer spending slowing down.
2/24/09: U.S. consumer confidence dropped to lowest on record in February as unemployment and foreclosures reach new highs. It expected that spending with decline even further in the coming months unless President Obama’s stimulus plan creates new jobs which will then pump more money into the economy.
2/23/09: Canada’s retail sales plummetted twice as much as expected in December, down 5.4 pct to $33 billion as consumers decreased spending on clothing, cars and building supplies.
U.K.’s retail sales drop at the slower pace in February but retailers are letting go of employees at an increased rate.