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Forex Trading StrategiesUSDJPY still capped at 121.40
The Japanse data out today in Asia, did little for USDJPY's inability to reach new highs we may soon see a break of 120.00 which would give scope for a deeper correction to the 118.20 area.
MAJOR HEADLINES PREVIOUS SESSION
Government raises forecast for Commodity exports.
Minerals and Energy exports to be A$90.3 billion, up 32%.
Commodities export for 2005-06 to reach $120 billion, up 22% from the prev year.
Reserve Bank Governor Alan Bollard will leave the official cash rate at 7.25% at his next interest rate review on January 26th according to 12 out of 13 local economist surveyed. Only ASB Bank expects a 0.25% rise. NZDUSD last bid at 0.7026.
Domestic Corporate Goods Price Index MoM for November flat at 0.0% vs 0.1% expected. YoY it rose 1.9% as expected.
Current Account Total for Oct month at 1376.8 Billion yen slightly higher than the 1360.0 billion yen expected.
Adjusted Current Account Total for Oct month at 1673.6 Billion yen vs. 1436.3 billion.
Export Price index MoM increased 1.6%, YoY increased 6.1%.
Import Price index MoM increased 1.7%, YoY increased 21.9%.
Trade Balance - BOP Basis for Oct month at 939.1 billion Yen. Adjusted Current Account correction: gains 3% vs Sept.
THEMES TO WATCH UPCOMING SESSION
The market looks locked on tomorrow's FOMC rate decision which is believed to be a 0.25% hike, but the debate is whether or not the Fed will change the language of the FOMC statement this week. The EURUSD bears were rejected in the 1.1700 area all last week, which is now the new base for this pair. So a more neutral stand from the Fed would likely lead to a break of 1.1900 in EURUSD and 1.2890 in USDCHF which would technically confirm new medium term trends.
The European markets eye UK PPI survey suggesting -0.2% MoM, 9.2% YoY along with German DIW's Dec bulletin.
Note: the support/resistance levels used in the matrixs of this document are levels derived from yesterday high, low and close. Reference in the text to other support/resistance levels will occur.
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