Wednesday September 15, 2004 - 18:58:04 GMT
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Dollar Bulls come out Punching
The greenback staged a “Rocky” like comeback this morning even on the not too impressive figures. Industrial Production was much worse than expected coming in at +.1 on an expected +.5, yet the revision was +.6 from last month, with that the dollar did not even flinch as it held its ground and held its overnight gains to make an intraday high of 1.2715. The euro was bashed early and often consistently today to make a new low of 1.2135, way off its 1.2293 highs of yesterday. The overall theme is that a range is a range, and we are still in it. The 1.2400-1.1980 is still in play. Empire State Manufacturing also was out today and we did see a stronger than expected number there which contributed to the dollar strength. Expectations of a 21 was overwhelmed when a 28.3 was posted. Some other news seen in NY was Martha Stewart asking to go to jail earlier than expected so she can be back by spring time to plant her flowers for next year. She asked to be held close at home as well so that her 90 year old mother can see her as well as her friends. The DOW was down all day today and did manage a late day charge but what was funny is crude oil prices a huge topic of discussion today with Hurricane Ivan ready to hit the gulf, was up as much as 1.00 and late in the day had reversed course to -0.75. The other interesting story today was OPEC raising output quotas even though they have been producing almost 2 million barrels a day already. That led dollar against the yen to make a new high seen today at 110.40.
Technically Speaking: We are still in a range but the dollar looked awful last Friday is now looking pretty healthy going into next weeks FOMC. The levels to watch now are 1.2515 on the down side coinciding with possibly 1.2310. USDJPY is very sensitive to oil pricing and as we saw today with crude prices up early and down a again late, the dollar did the same thing, so we expect with Hurricane Ivan, and now news of another Tropical storm forming in the Caribbean that this will continue to fluctuate oil prices, but overall should go higher in the short term.
Gain an Edge: We look to buy dips in USDJPY to 109.55 with a stop in place at 109.05; our objective is for a move to 112.00.
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