Tuesday November 8, 2005 - 06:26:06 GMT
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Tricom Futures and Foreign Exchange -
Forex: Like Santa Claus, the Euro's end of year rally will be make believe in 2005
The US dollar was firmer earlier today against the euro and yen, but the bullish rally is likely to pause in the short term, lacking fresh factors to propel the currency higher. With no key US economic releases overnight, traders focused on the Federal Reserve's revised industrial production estimates and key upward revisions to capacity use data.
Friday's break in the euro below 1.1870 usd probably signalled to petro dollar holders and the generic sovereign names that there is no need or urgency to step up to the plate to add to holdings of the euro.
With little economic data out today, the market should continue to trade a tight range. The USD will remain mildly bid on technicals, with some possible profit-taking starting tomorrow ahead of Thursday's US Trade Balance. Given the market could be entering a couple of days of sideways trade, i advise caution.
The Euro will remain soft now going into the end of the year, with the only proviso being a possible rate hike by the ECB in December.
Today’s Economic Releases:
Today's Top Trades
- Sell EUR/USD around 1.1760-70
- Buy USD/CHF around 1.3110
- Sell GBP/JPY around 204.90-205.00
For more ideas send me an email, email@example.com
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