This week 16th Jan 2012

Last week ended with a strong finish ;a down grade of as many as 10 European nations including France and Austria whose  AAA+ ratings were cut to AA+.There was also Italy,Portugal and Spain who were more or less not a surprise with the current economic turmoil in the Euro zone nations.Greek talks have also failed and they are inevitably heading towards a default.All these affected the Euro in the early morning trade opening lower and may just begin that descend to the 2500 mark.

The US dollar on the other hand seems to be enjoying further strengthening especially with these kind of issues compounding against the Euro. However,the market still lacks volumes and there is not enough to make a trend that we can honestly follow as retail traders.Last week we had some lackluster news from Australia but we saw it rise well against the dollar as the other Antipodes nation Newzealand continuing to see strength with the construction of Christchurch.

This week hopefully may begin the return of capital back to the markets that may see some good action back.The last two weeks have been very choppy and price action was a little wanting.There has been speculation of interventions by the Swiss and the Yen that we must be very careful when trading.At times like this when they are considered safe haven currencies, they might gather strength on the short fall only to suddenly move in the opposite direction as a result of interventions that come at times especially when we here are sleeping.You can imagine the night mare.

I have a small long position on the GBP/CHF on the daily chart with last weeks Friday bullish daily bar.Closed position for +2 pips.Price action really lacking at the moment.Market movement is very erratic and unpredictable on the short term due to capital sitting on the sidelines.

Aud/Jpy has formed an ascending triangle on the daily charts and depending on the way things are going we are poised for a break out  in my opinion to the downside to the 77.22 mark on my charts.

This I will be watching closely to see how it performs and try to catch the lower break once it is confirmed.Will continue to update as it progresses.We will also be watching other pairs as the week continues to progress.

This are my thoughts and good luck trading out there.Do a thorough analysis and let me know what you find.