Forex Blog

Enough with the Blogger, its glitchy publishing system and the limited settings choice. I’ve decided to move my Forex blog to WordPress, as I find it very good CMS for my needs. Of course, in the beginning there will be a lot of things messed up because of it, but now you will probably have a better experience with the whole more clean blog. And the posts will be actually posted without waiting periods of more than 10 hours (because sometimes Blogger just didn’t want my posts to be published).

As to the Forex market, not much news here today. U.S. factory orders for December rose 2.3% instead of the expected 2.4%, but it was still better than 1.5% previous value. This news probably made some difference for euro and EUR/USD rose about 30 pips up today.

U.S. dollar rallied to its two months low at 1.3320 today. Surprisingly the United States Trade Balance Deficit for April 2007 was reported almost 5 billion dollars lower than predicted $58.5 billion, whereas March Trade Balance Deficit was revised to $62.4 billion (almost a billion lower than previous value). Trade Balance Deficit tightening was caused by both lower import and higher export which is a very good sign for the U.S. economics. But this wasn’t the main reason for today’s EUR/USD correction, the main reason was the higher yield for U.S. bonds which broke through 5.00% yesterday and now many long term investors need to buy dollars to get into the bonds.

EUR/USD broke through 1.3400 today on Forex market - showing a new 7-week low. Good macroeconomic data from U.S. was the reason for this break-through. Nonfarm payrolls - a major employment indicator of the U.S. economy - increased by 157,000 in May (22 thousands more than expected), while ISM Index - reported an increase by 0.3% up to 55.0% (against 54.0% expected). ISM Index means a lot in the U.S. economy because it describes its most powerful industries, and greatly influences FOMC rate decisions. Now it is quite possible to see an increase in U.S. interest rates by 0.25% this Fall, in my opinion.