Monday March 14, 2005 - 20:52:45 GMT
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MARKET WARY OF BID TONE IN THE GREENBACK
Market appears to today be in a Dollar buying mood, but recent Dollar selling has come despite a strong run of US data and widening of yield spreads in favor of the US. Price action has suggested that even as the market is increasingly short USD, data driven dollar rallies have been viewed as opportunities to add to EUR longs. Furthermore rising inflation expectations imply risk that coming Fed hikes may not be as benign as previous tightening. This said, there were momentum players that travel with the trend getting long USD/JPY even as exporters were rumored to be selling USD/JPY as this pair moved through 105.00/10. EUR/USD traded heavy all day with short term traders exiting positions as Euro went through 1.3390 and also 1.3360. Euro put in a low around NY lunch that was at 1.3334/38 and maintained an offered tone. Tomorrow brings us Retail Sales and TIC data that should further stimulate the market.
Euro has put in a 1.3335 low on a 60 minute chart. This pair is trading below its 30 and 120 hour moving averages on a 60 minute chart and there is major trend line support seen at 1.3320/30 on the same 60 minute chart. Old support at 1.3390 and 1.3420 are now resistance to the upside.
GAIN AN EDGE
We look to buy Euro on a dip to 1.3325 with a stop below 1.3290 and a take profit of 1.3395
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