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Housing Data from US Better Than Expected

UFXBank Research from UFX Bank at 12/02/09


Daily Review 2/12/2009

USD Dollar (USD) – The Dollar weakened versus most majors as better than expected housing data was released and the Dubai effect fades away. Pending Home Sales came out surprisingly positive with 3.7% versus -0.4% decline expected. ISM Manufacturing PMI was released with 53.6 weaker than 54.8 forecasted. NASDAQ gained by 1.46% and Dow Jones reached new yearly highs with 1.23% change. Crude gained by 0.75% closing at 77.86$ a barrel and Gold (XAU) gained by 1.25% closing at new record highs with 1195.9$ an ounce after reaching the 1200$ mark. Today, ADP Non Farm Employment Change is expected with -149K versus -203K prior. FOMC Member Lacker will speak and the Fed's Beige Book will be released giving more information on future monetary policy decisions. Crude Oil Inventories are expected with -0.4M decrease versus 1M prior, and could result volatile prices.

EURO (EUR) –The Euro continued to climb versus the Dollar as Dubai's effect fades off and equity markets continue rising. Euro Zone Unemployment Rate came out 9.8% as expected and German Unemployment Change came out better with -7K decrease versus 5K increase expected. Overall, EUR/USD traded with a low of 1.4971 and with a high of 1.5117. Today, PPI is expected with 0.1% versus -0.4% prior.

EUR/USD - Last: 1.5090

Resistance 1.5145 1.5170 1.521
Support 1.5050 1.50 1.4975

British Pound (GBP) – The Pound rose versus the Dollar after Housing Prices showed an increase of 0.4% higher than 0.3% expected and Dubai's crisis concerns eased. Manufacturing PMI came out weaker with 53.6 versus 54.1 expected. Overall, GBP/USD traded with a low of 1.6390 and a high of 1.6646. Today, Construction PMI is expected with 46.9 versus 46.2 prior. MPC Member Dale will speak today at Essex.

GBP/USD - Last: 1.6620

Resistance 1.6650 1.67 1.6750
Support 1.655 1.651 1.6475

Japanese Yen (JPY) –The Yen weakened versus the Dollar and the Euro after BOJ announced it will provide 115 billion Dollars for 3 month loans at 0.1%. Monetary Base came out weaker with 3.8% versus 4.7% expected. Overall, USD/JPY traded with a low of 86.16 and a high of 87.53 and EUR/JPY traded with a low of 129.32 and a high of 131.27. Today, Capital Spending is expected with -15.8% versus -21.7% prior.

USD/JPY-Last: 86.70

Resistance 87.1 87.5 88
Support 86.3 85.75 85.25

Canadian Dollar (CAD) – The Canadian Dollar rose versus the Dollar as investors shift back to higher yielding assets. Australian government raised its overnight interest rate by 0.25% supporting other commodity linked currencies such as the Canadian Dollar. Overall, USD/CAD traded with a low of 1.0405 and a high of 1.0576. No economic data expected today.

CAD/USD - Last: 1.0465

Resistance 1.0475 1.0505 1.054
Support 1.04 1.0375 1.0315

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