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The EUR/USD climbed for a second day to 1.4168 after rising to a high of 1.4174

Varengold Bank Research Team from Varengold Wertpapierhandelsbank AG at 01/25/10


Good morning from cold Hamburg. We hope you have enjoyed your weekend and you were able to relax for a new trading week. Today we will see important data from the US, which could have decisively influence on the FOREX market. Have a nice start in the new week.

Market review

According to a survey the fed officials will do their part to spur the economic growth by keeping interest rates near zero after their two-day meeting this week. Futures trading in Chicago showed on Friday an 18 percent chance that the fed will raise its target lending rate by at least a quarter-percentage point by its June meeting. Today, the US economy will release the data of Existing Home Sales in December. The Monthly data is expected to show a fall of 9.8% while the annual rate may be fallen to 5.9 million from 6.54 million in November. The USD fell against the EUR, JPY and a lot of other major currencies. The EUR/USD climbed for a second day to 1.4168 after rising to a high of 1.4174. The USD/JPY fell for a third day to 90.14 after touching on Friday a low at 89.79, which was the lowest level since December 12th. The falls in the USD may be also caused by the drops in stocks after the Nikkei 225 stock Average fell 0.5 percent and the S&P 500 Index fell 2.2 percent on Friday. The AUD/USD gained also for a second day after it touched its psychological support around 0.90. The NZD/USD has got support around 0.71 and pulled up to a high of 0.7170 before coming back to 0.7158.


On a long term view, the EUR/JPY has reached its support level around 127.00. It is the forth touch around this level since the middle of Mai 2009. As you can see, the Auto Regression Bands are signalizing an oversold market. If the market doesn’t make a break trough the strong long term support it may turn back and start a bullish phase.


After breaking trough the 1.6780 resistance and getting support around the second pivot resistance level last week, the GBP/CHF has recovered back and crossed below the 1.6780 level. At the moment there are no significant support levels. That may be a sign for further falls towards the first pivot support line around 1.6635.

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