Friday February 4, 2005 - 16:42:14 GMT
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European Forex Session Wrap-up - 4/2/05
The European session closes today, february 4th, with both european currencies EUR and CHF trading significantly lower against the USD. EUR is breaking key fibo support around 1.2940/30 as I speak, after good unemployment numbers from the US (unemployment rate at 5.2%, lowest level since 2001). Looks like finally fundamentals and technicals worked hand in hand today.
Though the first reaction was dollar negative, the unemployment report shows signs of relief for the US economy, though much more work must be done. The negative reaction was caused because expectations were much higher than the actual number, but then, when the news was analyzed (and given the current short-term USD sentiment), the greenback just went back up, recovered all its losses and keeps on gaining at this moment. It finally managed to break (and for now it is still trading below) the key 1.2940/30 area, which opens the door for more downside, if confirmed. Both EUR and CHF also lost big time against the third european currency, the GBP, which is almost flat after the news release, showing good tone for the time being. In my morning report, I suggested the chance that selling Eur against the GBP for a move down to strong support at 0.6850 was an efficient trade, at it just proved it right.
Trading Recap :At the time of this writing, the EUR is trading around 1.2920 against the greenback, or 45 pips down with respect to european opening levels, and finally breaking the 1.2940730 area, and also finally following its european fellow CHF. GBP is doing around 1.8845, 35 pips up. The Swiss Franc –CHF- around 1.2055, loosing (USD gaining) 30, confirming the break of the key 1.1960/75 level. It looks to me a very strong signal for the greenback. And finally, the Yen around 103.70, up some 80 pips.
USD small brothers session performance: the AUD is trading around 0.7720, 15 pips up, the NZD trading around 0.7120, or 20 pips up, and CAD trading around 1.2490, down 85 pips.
Economic events to resume for february 8th. My (valoration) of the economic events of the day goes from 1 to 5 depending on the influence the news has in the market (1 lowest – 5 highest).
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