Tuesday October 4, 2005 - 05:05:29 GMT
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Tricom Futures and Foreign Exchange -
Forex: Gold and the USD rallying. Is nothing sacred anymore?
The US dollar eased against the yen in afternoon trade here, after climbing to 16-month highs against the Japanese currency overnight, hit by profit-taking and a surge in the Nikkei 225 stock index. The dollar hit a high of 114.36 yen in New York trading, a level not seen since May 2004, following the release of strong US manufacturing data and disappointment on the Bank of Japan's September Tankan survey.
The euro was slightly firmer against the dollar, thanks to short-covering after it managed to hold onto the 1.19 usd level, but its near-term prospect is not so bright due to widening interest rate differential between the US and the Euro zone.
The market action this morning has suggested we maybe heading for a retest of the 1.1875 area in the EUR/USD, and conversely the 1.3070 level in USDCHF. For today, the sentiment remains with selling strength in the EUR, and/or buying dips in the USD. However, with little in the way US data due out today, most of the market's attention will focus on Eurozone PPI and unemployment data.
Today’s Economic Releases:
US: Factory Orders
Today's Top Trades
. Sell EUR/USD around 1.1960, with stops above 1.1985
. Buy USDCHF around 1.3000, with a 40 pip stop
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