Friday June 10, 2005 - 05:12:14 GMT
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Tricom Futures and Foreign Exchange -
Forex: The EUR will trade 1.2000, before it trades 1.2400
Asian trade was subdued as we come to the end of another week of tooing and froing. The EUR's failure above 1.2300, and its inability to break above 1.2340, now sets the scene for a test 1.2000 in coming weeks.
The USD rose modestly in choppy trade on Thursday after Federal Reserve Chairman Alan Greenspan said the U.S. economy is on a firm footing and that interest rates can continue to be raised at a measured pace. The dollar's gains on Greenspan's comments to Congress were exacerbated by relief in some quarters that the Fed chief did not echo recent remarks from other Fed officials that the Fed might be nearing the end of its rate-raising cycle. Tonight, we have the US Trade Balance. The market knows it’s bad, so any effect will be short-lived I suspect.
U.S. Treasury debt prices sagged on Thursday after a sale of reopened 10-year debt drew only modest demand, particularly from indirect bidders.
The soft auction only reinforced early selling, which followed a reaffirmation by Fed Chairman Alan Greenspan of the need for tighter monetary policy.
Greenspan largely glossed over recent weakness in the economy, and did not even acknowledge softness in the labour market and declining growth in manufacturing -- a blow to bond market bulls.
U.S. stocks rose on Thursday, helped by optimism ahead of Intel Corp.'s business update and comments on the economy from Federal Reserve Chairman Alan Greenspan, but a spike in oil limited gains.
Today’s Economic Releases:
· US: Trade Balance
Today’s Top Trades
· Buy USD/CHF on dips to 1.2520, for a push towards 1.2600 initially
. Sell EUR/USD around 1.2250-60, for a push down towards 1.2000
. Sell GBP/JPY around 195.90-00, take part profit at 195.65, and hold the balance for a larger move lower
. Sell EUR/JPY around 131.50-60
. Sell GBP/USD around 1.8230-40, for a move towards 1.8000
For more ideas send me an email, [email protected]
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