Friday August 5, 2005 - 05:04:35 GMT
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Tricom Futures and Foreign Exchange -
Forex: Look, up in the sky - Is it a bird, is it a plane, no it's the Euro!!! AGAIN
The dollar weakened against most major currencies in a seesaw session on Thursday as dealers adjusted positions ahead of Friday's July U.S. employment report.
The euro powered to a fresh 2-month intra-session high of $1.2402, according to Reuters data, while the dollar tumbled to a two-month low against a basket of currencies.
More talk of central banks selling dollars, stop-loss sell orders and relatively thin markets conspired to push the dollar lower against most currencies except the yen.
Analysts expect another month of solid employment gains in July, with median estimates pointing to the creation of about 183,000 jobs, according to a Reuters survey.
The European Central Bank held interest rates unchanged while the Bank of England cut borrowing costs for the first time in two years.
The only thing surprising about the EUR's strength late in New York, and during Asian trade today is the fact that the market has ignored today's US employment data. I was expecting the market to sell USD's, and buy EUR etc, but thought that they might have been cautious and waited to see tonight's data before pulverising the USD. The gap between the EUR/USD and USD/CHF is now less than 160 pips, whereas at the start of the week they were 700 pips apart. The last time they crossed over around 1.2470, in May, we saw the USD/CHF rally to 1.31, and the EUR/USD fall to 1.1860. This time around we may see an initial touch then a small recovery in USD/CHF and a small pullback in EUR, but eventually they will crossover, possibly next week - or even following today's data depending on how bad it is.
Today’s Economic Releases:
US: Non-Farm Payrolls
Today’s Top Trades
· Buy AUD/NZD around 1.1130-40
· Buy EUR/USD around 1.2310, followed by 1.2270
. Sell USD/CHF around 1.2650, followed by 1.2690
For more ideas send me an email, [email protected]
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