Thursday March 23, 2006 - 07:55:35 GMT
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Tricom Futures and Foreign Exchange -
Forex: The USD gains ground, but very slowly
The US dollar was narrowly mixed against other major currencies with investors reluctant to take aggressive positions ahead of next week's US Federal Open Market Committee meeting.
While investors have already priced in a likely (25 basis points) rate hike at next week's FOMC meeting, investors will still be waiting anxiously for the FOMC's statement to try and get an idea of its future rate intentions. While there has been previous speculation that the US Federal Reserve is close to ending its rate hiking cycle, any statement from the FOMC that suggests the Fed is not done yet should see the dollar attract renewed buying interest.
The USD continues to grind higher, as traders start to price in hawkish comments following next week's expected 25bps hike by the Fed.
As suggested yesterday, the EUR/USD broke under 1.2070, and USD/CHF broke above 1.3040. These levels will now become resistance and support respectively. That is, look to sell EUR/USD around 1.2070, and/or buy USD/CHF around 1.3040 today.
Again, the economic calendar is a little light on, but we have a few ECB officials talking, which may impact on the EUR.
Today's Economic Release:
US: Exisiting Home Sales
US: Weekly Jobless
Today's Top Trades
- Sell EUR/USD around 1.2070, with stops above 1.2115
- Buy USD/CHF around 1.3040, with stops under 1.2990
For more ideas send me an email, firstname.lastname@example.org
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