Monday June 20, 2005 - 04:59:49 GMT
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Tricom Futures and Foreign Exchange -
Forex: Hold your ground Mr Blair
The Euro gave back some of its gains from Friday, in early trade today, following the market’s reaction to the EU stalemate on the budget, and further negative comments by certain members of the EU over the weekend. The EUR/USD found support around 1.2180 this morning, and now is knocking up against resistance at 1.2240. Given the negative sentiment surrounding the EUR at the moment, I’d like to stick to my call for a move under 1.2000 in coming days/weeks. A close above 1.2340 will change my thinking.
The dollar sagged against the euro on Friday after news of a record U.S. current account deficit raised concerns about the country's ability to attract foreign investments and its penchant for overseas goods.
The U.S. current account shortfall for the first quarter amounted to $195.1 billion or 6.4 percent of gross domestic product, and was wider than the $190 billion forecast by economists. The deficit in the fourth quarter of last year was also revised to a slightly wider $188.36 billion.
U.S. Treasury debt prices took a hit on Friday from a sharply higher measure of consumer sentiment but they clawed back toward steady levels by mid-session as crude oil prices surged toward record highs.
A renewed pickup in energy costs could undermine the feel-good nature of the University of Michigan's consumer sentiment index, which rose in early June for the first time this year.
U.S. stocks were higher on Friday, boosted by news of a rise in consumer confidence and a jump in energy company shares as oil prices soared to a record high above $58 a barrel.
While high oil prices are generally negative for stocks -- and indeed trimmed the market's gains in late-afternoon trading -- they help energy companies' profits.
Today’s Economic Releases:
· US: Leading Indicator
Today’s Top Trades
· Sell EUR/USD strength towards 1.2230-40
· Buy USD/CHF on dips to 1.2600-10
· Buy AUD/NZD on dips to 1.0830-40
· Buy GBP/JPY around 198.50-60
For more ideas send me an email, [email protected]
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