Thursday October 6, 2005 - 05:39:18 GMT
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Tricom Futures and Foreign Exchange -
Forex: We warned you yesterday about the wounded Euro.
The US dollar was trading lower against the major currency pairs but the euro has broken resistance following weak US services and firmer eurozone data. The euro recovered overnight to 1.1984 usd from 1.1929 following the release of the US ISM services survey for September
The survey fell to 53.3 index points from 65.0 in August, the lowest level since April 2004 and the biggest fall in the survey's eight-year history
The EUR's rebound has continued through the Asian session, as the single currency managed to get back above 1.2050.
I'm cautiously optimistic that this EUR bounce could be the start of a larger move. However, I remain concerned until we see a move back above 1.2110. Obviously, some of this move higher today has been short covering, particularly those who got caught out late in the US session.
ECB and BOE interest rate meetings today expected to announce no change in rates, but their comments could be looked at closely by the market for signs of an economic slowdown, which could see some of today's gains eroded.
Today’s Economic Releases:
UK: Industrial Production
UK: BOE meeting
EU: ECB meeting
US: Weekly Jobless Claims
Today's Top Trades
. Buy EUR/USD around 1.2030-40, with stops under 1.1980
For more ideas send me an email, [email protected]
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