Tuesday March 7, 2006 - 08:37:02 GMT
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Tricom Futures and Foreign Exchange -
Forex: The USD comes back, again
The dollar steadied against the yen earlier today, keeping the previous day's gains as market conviction grows that the dollar's yield advantage won't weaken even if the Bank of Japan ends its ultra-easy monetary policy.
The dollar jumped about 0.5 percent against the euro and the Swiss franc, extending gains as U.S. bond yields rose to 21-month highs.
The dollar got a lift on Monday from economic data that showed a smaller-than-expected decline in February factory orders and upward revisions to January's durable goods orders.
As i said yesterday, be careful about this USD rallying back. I didn't expect it to happen overnight though. Obviously, we remain stucj in this choppy trading environment where a 40 pip winning trade is like making 100 pips at the moment.
The market's obviously looking towards Friday's payrolls now, but it's been a long time since that number moved the market more than 50 pips.
The Canadian central bank meets today with another 25bps hike expected. I'm looking for dovish comments to ensue, with the CAD looking soft after last night's fall in commodity prices.
Today's Economic Release:
UK: Retail Sales
CAD: Central Bank meeting
Today's Top Trades
- Buy USD/CAD around 1.1420-10, with stops under 1.1380
For more ideas send me an email, firstname.lastname@example.org
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