The Foreign Exchange market is becoming the fastest growing industry on the internet. The secret is out; and a lot of people are making money on FX currency trading. And these are people like you and me, average people. This is because the government has recently relaxed rules to make the access to the FX market more easy for the average Joe investor and the advent of the internet into all our homes has given us a currency trading platform. For small investors, FX trading has become a lucrative source of income and everybody is trying to jump on the bandwagon.

Before you get started, it is useful to learn and understand a little bit about currency trading. There is plenty of information out there to help you learn, but remember that a lot of this supposed information and free FX currency strategy advise is bogus. But don't let this bias you against seeking real, quality Foreign Exchange education, because this will be critical to your success as a FX trader. The second piece of advice that one should keep in mind is to start small. If you do well as a FX trader, increase your budget slowly, but make sure you do not bet your life's savings on your trades.

Further, seek a good FX training course in currency trading. There are plenty of these online or find out where you can attend workshops locally. They will provide a lot of information on buzzwords, background material, historical data on currencies and a glossary of terms used in FX trading. Also, you can ask questions, which will be answered by experts on chat, message boards and forums. There are courses on FX trading that give you access to their library where you can see historical trends and all types of useful literature. Financial gurus run these FX training courses and offer videos with their own Foreign Exchange trading systems explained in detail.

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Major Pairs at Key Levels

Dollar's rally is still being held by key levels in against some major currencies. GBP/USD recovers after hitting 1.83 level, AUD/USD is drawing support from 0.85. USD/CHF is still struggling around 1.1. Momentum in EUR/USD is not convincing too. Dollar is struggling to find follow through buying with oil still held inside range of 112 and 118 level and will probably need a break out there to give clear direction. On the other hand, note that focus in the major pairs will remain on near term levels mentioned in out technical outlook reports and as long as these levels holds, there is still no change in dollar's near term bullish outlook yet.

On the data front, Germany import price showed 0.6% mom, 9.3% yoy gains in Jul. Prelim CPI is expected to drop -0.2% mom in Aug, with yoy rate moderated slightly from 3.3% to 3.2%. Durable goods orders in US will be the main focus and is expected to be flat in Jul, with ex transport orders dropping -0.5%.

FOMC minutes released overnight didn't revealed much new information. Members generally agree that the economy will remain weak and are generally concerned the possibility that core inflation will moderate as growth slows. The next move from Fed is still likely a hike but the opinion on the timing is rather divided.

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AUD/USD Daily Outlook

Daily Pivots: (S1) 0.8485; (P) 0.8565; (R1) 0.8638

AUD/USD recovers mildly after meeting mentioned 0.8512 cluster support target. At this moment, intraday bias remains on the downside as long as 0.8689 minor resistance holds. Sustained break of 0.8512 cluster support will bring deeper decline to test long term trend line support and 0.80/81 level. On the upside, though, above 0.8689 will turn intraday outlook neutral first. Further break of 0.8812 resistance will confirm that a short term bottom is finally in place with bullish convergence condition in 4 hours MACD and RSI. Stronger rebound should then be seen in such case.

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EUR/USD and AUD/USD Finally Formed a Short Term Bottom?

Despite initial strength, the greenback is gradually turning soft this week following rebound in oil prices. USD/CAD and USD/JPY has correcting for some time already. Now it seems that EUR/USD and AUD/USD are both finally bottoming. Both pairs are now pressing near term resistance level with clear sign of loss of downside momentum. Further upside in both pairs will confirm this case and bring stronger rally.

The tricky one is Sterling which remains under tremendous pressure, across the board. Some sell off is seen against yen and Swissy after nationwide house prices fell for the ninth month by -1.9% mom in Aug, dragging yoy rate to -10.5%.

On the other hand, the Euro remains supported by comments from ECB weber yesterday that discussion in rate cut is premature. Focus will turn to Germany job report, Eurozone M3 and sentiments indicators. Germany unemployment rate is expected to remain unchanged at 7.8% in Aug. Eurozone M3 money supply growth is expected to continue to slow from 9.5% yoy to 9.0%. Business climate and Economic sentiments are expected to show further deterioration.

Q2 GDP revision will be the main focus from US today. Markets expect a large upward revision from preliminary estimate of 1.9% to 2.7% mainly due to much better than expected performance of net exports in Jun. Though impact to the markets may be muted as the data is considered 'old'. Dollar strength and weakness will likely continue to be driven by developments in crude oil.

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AUD/USD Daily Outlook

Daily Pivots: (S1) 0.8532; (P) 0.8584; (R1) 0.8638

AUD/USD's recovery from 0.8493 continues today and is now pressing 0.8689 minor resistance and 4 hours 55 EMA. An intraday low should be in place with 4 hours MACD crossed above signal line again. Outlook is turned neutral for the moment. Further break of 0.8812 resistance will confirm that a short term bottom is in place after meeting mentioned 0.8512 cluster support target. In such case, stronger rebound should be seen to 38.2% retracement of 0.9849 to 0.8493 at 0.9011 or above but upside should be limited by 61.8% retracement at 0.9331 and bring fall resumption. On the downside, sustained break of 0.8512 cluster support will indicate decline from 0.9849 has resumed and bring deeper decline to test long term trend line support and 0.80/81 level.

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Yen Lower after Strong US Durables

The Japanese yen spikes lower in early US session on anticipation of a strong open in US stock markets after durable goods orders beat expectation. However, the greenback continues to be soft, pressured by rebound in oil prices. Headline durables jumped 1.3% in Jul versus consensus of 0%. This is the third consecutive months of expansion. Ex-transport orders rose 0.7% versus consensus of -0.5% fall. Ex-defense orders also rose 2.8% versus expectation of 0.2%. The data argues that business spending and confidence are continuing to recover in the US.

Dollar continues to retreat against majors after hitting key levels against Aussie and Sterling and struggling against Swissy around 1.1. Oil continues to rebound further to as high as 118.53 on concern of disruption of operations in Gulf of Mexico by Tropical Storm Gustav. The direction in the greenback will like continue to be dominated by oil prices. DOE crude inventories will also be watched later today.

Euro is supported by comments from ECB Weber and recovers against dollar and yen. Weber said that the discussion about declining rates in Europe is "premature" and "If the economic outlook brightens somewhat again towards the end of the year and next year, which I still expect, we'll have to see if action is necessary."

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USD/JPY Mid-Day Outlook

Daily Pivots: (S1) 109.17; (P) 109.56; (R1) 109.98

USD/JPY's retreat was contained at 108.70 and recovers in early US session. The three wave structure of the fall from 110.27 to 108.70 suggests that it's merely a correction to rise rom 108.13. Though, outlook remains neutral for the moment. Break of 109.92 minor resistance will add more credence to this case and encourage stronger rise to 110.66. Break will confirm that recent rally has resumed for next target of 61.8% projection of 95.77 to 108.58 from 103.76 at 111.68.

On the downside, firstly, below 108.70 will dampen this above case and bring deeper fall to 108.13 low. Also, note, though earlier, that the possibility of a short term head and shoulder top (110.4 110.66, 110.27). Break of 108.13 will indicate recent up trend has possibly reversed and and much deeper decline should the be seen to test medium term rising trendline support (now at 106.49).

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Dollar Got No Boost From GDP Revision

Dollar shows little reaction to stronger than expected upward revision in US Q2 GDP. Instead, volatility is again seen in the Japanese yen. Preliminary Q2 GDP annualized growth rate was revised higher from 1.9% to 3.3% versus expectation of 2.7%. Record exports and the smallest trade deficit in eight years were the biggest driver in the upward revision. Personal consumption was revised up to 1.7% versus expectation of 1.6%. Jobless claims dropped slightly but remains elevated at 425k. Dollar remains pressured by strength in oil which extends rebound to close to 120 level. The Japanese yen spikes lower in on anticipation of higher open in US stock markets. However, note that outlook in the yen is still mixed with USD/JPY and EUR/JPY bounded in range.

Euro remains supported by strong employment report in Germany which saw unemployment rate dropped to record low of 7.6% in Aug, with unemployment dropping more than expected by -40k. Eurozone M3 money supply slowed less than expected to 9.3% yoy in Jul. Sterling, on the other hand, remains pressured after poor data from UK today. Nationwide house price dropped -1.9% mom, -10.5% yoy in Aug. CBI distributive trades dropped to -46 in Aug.

Technically speaking, EUR/USD and AUD/USD continues to press near term resistance. Both pairs have displayed clear indication of loss of downside momentum and is set to confirm that short term bottom is in place.

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EUR/USD Mid-Day Outlook

Daily Pivots: (S1) 1.4648; (P) 1.4712; (R1) 1.4791

EUR/USD continues to press 1.4807 resistance in early US session. Intraday outlook remains neutral for the moment. As discussed before, with bullish convergence condition in 4 hours MACD and RSI, firm break of 1.4807 will be an important signal that a short term bottom is finally in place. Further break of 1.4908 will confirm and bring stronger rebound to test 1.5284 double top neckline resistance before staging another fall. On the downside, though, below 1.4571 will indicate that recent fall is still in progress to key medium term support at 1.4309.

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