Oct 30th Nov 5th 2011

Volume 1, Issue 26

Elite Global Trading

Forex Weekly Commentary

Fundamental Outlook
direct response to possible heavy outflows from now defunct MF Global's accounts. This change is expected to be temporary, with that we may see risk assets have more buyers in early trading as speculators take advantage of the lower margins needed to enter into a contract.

In this issue: Fundamental Outlook AUDUSD GBPUSD USDCAD EURUSD EURAUD Event Risk 4 3 1 2

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The Markets look for guidance to start week off and with a quiet start to the week regarding US news the spot light will be on Europe. As markets trade near highs from last weeks lows another move lower is on tap for risk driven assets. A move higher in some of the currency pairs and markets may be where the week starts but not expected to last before the next move to lower support below last weeks lows. With former Greek Prime Minister George Papandreou calling and canceling a referendum concerning further austerity and putting in jeopardy Greeces membership in the EU-17, a G20 meeting bringing Italian government budget woes in the spotlight and ending with a confidence vote confirming Papandreou, markets are nervous about the new political developments from the Mediterranean country. We expect to continue to hear positive and negative news out of Europe giving the markets swings in both directions. We are entering an interesting period of time after the massive swings we have had over the past several months. We are heading into range bound markets that may last for sometime before another move in either direction. With Europe on the brink of disaster, the markets hold their breathe for positive outcomes in all the decisions and plans that need to be executed. The Intercontinental Exchange and CME both decided to lower initial margins for speculative accounts. This easing of liquidity was done as a

Oct 30th Nov 5th 2011

Volume 1, Issue 26

Elite Global Trading

Australian Dollar / United States Dollar

AUDUSD: As the AUD/USD carves out another top just below 1.0800, the pullback from 1.0752 may gather pace in the days ahead, and the event risks on tap for the following week may have a limited impact on the Aussie as the central bank casts a weakened outlook for the region. In turn, we may see the Australian dollar continue to give back the rebound from 0.9390, and the exchange rate may come up against the 38.2% Fibonacci retracement from the 2010 low to the 2011 high around 0.9930-50 to test for near-term support. Ahead of the next move lower we can not rule out another move towards 1.0550 area. Along with this outlook for more bears in the near-term for the AUDUSD, we have a head and shoulders pattern being carved which brings more evidence for another move lower. Outlook: Bearish, with a weakening economy we see further downside risk on tap, look for support at 1.0300, 1.0250, 1.0202, 1.0120, 1.0050 and .9900. Ahead of this move down we may see price pop up to 1.0500 area look for resistance at 1.0450, 1.0500, 1.0542

UK Pound Sterling / United States Dollar

GBPUSD: The center focus for this week in the GBPUSD is the BOE Rate Decision Thursday morning, expected to stay the same at .50%, another asset purchase may be possible exceeding current level of 275billion Pounds in protection of the fragile economy that has a 50% chance of slipping back into recession. The pair held it's ground quite well to close out the week above 1.6020, a pattern of a head and shoulders is starting to form that may project price down towards to 1.5700 area in the weeks to come. Current levels also suggest that a touch of the 1.6200 area is not to be ruled out. With the dollar gaining and looking to cover more positive ground in the weeks to come may bring a good case to look for movement on the downside in this pair. Outlook: Neutral, a touch of the upside highs next week can not be ruled out, resistance to watch for, 1.6060, 1.6100, 1.6166, and 1.6200. A favored downside move can be expected towards support at 1.5824, 1.5719, and 1.5660.

United States Dollar / Canadian Dollar

USDCAD: The Dollar/Cad is poised to move towards the 1.0360 area in the weeks to come, with the .9900 level holding, a move on the bullish side is expected. Outlook: Bullish Bias, with the $DXY making a recovery back towards the highs the USDCAD is poised to move bullish as well. Look for resistance at 1.0225, 1.0260, and 1.0364. Support for this next move higher sits at 1.0100, 1.0072, 1.0040, and .9990.

Oct 30th Nov 5th 2011

Volume 1, Issue 26

Elite Global Trading

Euro / United States Dollar

EURUSD: The EURUSD has shown little desire to break to fresh lows, and yes it seems the markets may have registered a significant bearish sentiment extreme. The EUR-short trade has become quite popular and exceedingly crowded. Non-commercial futures traders recently hit their most net-short since the EUR set a significant bottom near the $1.20 mark. The decline from 14246 is impulsive and therefore composes the first leg of the next bearish sequence and we are currently in a consolidation zone of a 200 pip range from 1.3650-1.3850. The next level of resistance would be 13910/25 and 14000. These levels are possible before next major move down below 1.3550. With Sentiment a bit mixed at the moment be aware of the range for the week to come and respect the fact that we may play within this range for sometime before the pair declines to lower levels. Outlook: Neutral, with the current range on tap we see possible movements higher to 1.3900-1.4000. Once we reach range extremes we can expect a move lower towards the 1.3660 area, and a break of this level we will certainly attack the 1.3560 level. We see selling in the 1.3900s-1.4000s as a good play looking to the lower part of the range for targets around the 1.3700 level.

Euro / Australian Dollar

EURAUD: This pair has moved off it's highs of it's 1000 pip range to the lows which it hit a low last week at 1.3110. A move to the highs over the weeks to come is most likely. Outlook: Bullish Bias, with the Aussie expected to weaken in the weeks to come we expect a move back to the 1.3700. Support sits at 1.3170 and 1.3111. Resistance on the move up is at 1.3332, 1.3483, 1.3598, and 1.3665.

Oct 30th Nov 5th 2011

Volume 1, Issue 26

Elite Global Trading

Weeks Event Risk

Monday: GBP: Halifax HPI 3am EUR: Sentix Investor Confidence 4:30am EUR: Retail Sales 5am EUR: German Industrial Production 6am AUD: Trade Balance 7:30pm EUR: French Industrial Production 2:45am EUR: ECB Monthly Bulletin GBP: Official Bank Rate/Asset Purchase GBP: MPC Rate Statement CAD: Trade Balance 8:30am USD: Trade Balance 8:30am

Tuesday: EUR: ECOFIN Meetings GBP: Manufacturing Production 4:30am CAD: Housing Starts 8:15am AUD: Home Loans 7:30pm CNY: CPI 9pm

Friday: GBP: PPI Output 4:30am USD: Bank Holiday USD: Prelim UoM Consumer Sentiment

Wednesday: GBP: Trade Balance 4:30am USD: Fed Chairman Bernanke Speaks NZD: RBNZ Financial Stability Report AUD: Employment Change 7:30pm AUD: Unemployment Rate 7:30pm CNY: Trade Balance

Thursday:

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News letter Authors: Anthony Rousseau

arousseau@eliteglobaltrader.com

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