Currency Pair Overview The Asian Session Moves Almost Without Any Momentum

Overall, the dollar advanced yesterday for the first time this week against the majors. The move came on a positive equity market, despite more disappointing data coming from the U.S. In the Asian session, every pair advanced against the dollar, surprisingly even the yen, but the moves came on a very weak volume and momentum, suggesting it may not have the power to withstand a test later in the day.

The Euro (EUR/USD) declined even in the first minutes, yesterday. The pair finished the day near TheLFB S1, 180 pips lower. With the declines it posted yesterday, the euro snapped an upside rally that lasted 3 days. In the Asian session, the euro gained an additional 40 pips.

The Pound (GBP/USD) fell near the neutral pivot point in the early trading hours and since then it traded in quite large swings around the pivot point. The pound declined at the end of the last day of trading 100 pips, even though the trading range reached nearly 300. So far, into the new day of trading, the pound gained 40 pips.

The Aussie (AUD/USD) failed for a third consecutive day to break above the 20-day moving average. The aussie traded quite smoothly yesterday, and had at the end of the day a 120 pips range. In tonight’s session, the pair ran another test at the same resistance area, but for the moment, it could not push anywhere higher. 

The trend estimate for total new capital expenditures rose in terms of volume by 2.9 percent in the September quarter of 2008 while the seasonally adjusted rate rose 0.6 percent. The estimate for buildings and structures rose by 2.4 percent this quarter, and 6.6 percent seasonally adjusted. The fourth estimate for 2008-09 is 21.9 percent higher than the fourth estimate for 2007-08 and is 1.6 percent higher than the third estimate for 2008-09. Overall, total capital expenditure is up by 15.9 percent, year over year.

The Cad (USD/CAD) formed a doji-start at the end of the last day of trading, the second one in a row. Both the candles’ real body sits exactly in the same area, further showing the pair’s indecision. On the downside, the cad could not break under the 20-day moving average, while on the upside, the 1.24 area stopped the pair from any gains. Tonight, in the Asian session, the pair fell 30 pips.

The Swissy (USD/CHF) started yesterday to move higher in the early session and continued to do so until the closing bell. The pair bounced near the Asian open from the 20-day moving average, and gained 180 pips yesterday, practically recovering the declines seen at the start of the new trading week.

The Yen (Usd/Yen) formed a doji-star at the end of the last day of trading, despite that the S&P closed in the green. In the overnight session, the yen traded somewhere lower, but during the U.S. session, it pared every pip lost earlier. Since the Asian session started, the yen fell 35 pips.

The monetary policy meeting minutes from Japan revealed that member Atsushi Mizuno voted against the 20 basis point rate cut at the October 31st meeting, stating that a cut would not have any effect on the economy and instead advocated for an increase in fund supplies instead. However, all members agreed that the financial markets were nervous. The minutes also showed that members were concerned about the future of the global financial markets and what effect it would have on the appreciating of the yen and exports. Three members of the eight-member panel had pushed for a 25 basis point cut but were overturned and a second vote on the softer 20 basis point cut resulted in a tie in which Governor Shirakawa decided the cut would go through.