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THe GBP Posted Sharp Gains Against the USD

UFXBank Research from UFX Bank at 11/05/09


Daily Review 5/11/2009

USD Dollar (USD) – The Dollar fell across the board on the FED decision to leave interest rates at their historic lows of 0.25%. Stocks ended mostly up in the U.S. but far from their daily highs. The ADP National Employment Report came out -203K worse than -190K expected. The Dow Jones rose by 0.31%, The Nasdaq closed almost unchanged with -0.09% decrease and the S&P added 0.1%. Gold (XAU) continued to rise and posted new record highs at $1,097. Crude oil rose for the 4th day in a row and is back above $80 a barrel. Today, The Nonfarm Productivity is expected at 5.8% versus 6.6% previously. The Unit Labor Cost is expected -3.7% vs. -5.9% previously. The Initial Jobless Claims is expected 520K vs. 530K previously.
EURO (EUR) – The EUR/USD continued on its uptrend for the week and soared against the Dollar. The Producer Price Index came out -0.4% worse than -0.3% expected. EUR/USD traded with a low of 1.4701 and with a high of 1.4907. Today, The European Central Bank will release their interest rate decision, expected unchanged at 1%.

EUR/USD - Last: 1.4838

Resistance 1.4925 1.498 1.5045
Support 1.48 1.476 1.47

British Pound (GBP) – The Pound posted sharp gains against the Dollar and extended its 2 day rally after the Fed's rate decision. The Services PMI came out 56.9 better than 55.4 expected. Overall, GBP/USD traded with a low of 1.64 and a high of 1.6595. Today, The Bank of England will release its' decision on the interest rate, the economists expect it unchanged at 0.5%. The Manufacturing Production is expected at 1.1% vs. -1.9% previously. The Industrial Production is expected at 1.1% vs. -2.5% previously.
GBP/USD - Last: 1.6515

Resistance 1.6605 1.664 1.6695
Support 1.6495 1.6455 1.642

Japanese Yen (JPY) – The Yen tumbled across the board. BOJ said on its minutes it is not planning to raise interest rates soon even after ending the emergency programs. Overall, USD/JPY traded with a low of 90.03 and a high of 91.30. Today, Leading Indicators are expected higher with 86.4% versus 83.2%.

USD/JPY-Last: 90.55

Resistance 91 91.3 91.55
Support 90.4 90.25 90.05

Canadian dollar (CAD) – The Canadian Dollar ended higher as commodity prices kept advancing and higher yielding assets demand remained high after U.S interest rate decision was released. Overall, USD/CAD traded with a low of 1.0587 and with a high of 1.0683. Today, Building Permits are expected at 1.2% vs. 7.2% previously. Ivery PMI is expected at 60.9 vs. 61.7 previously.

CAD/USD - Last: 1.0645

Resistance 1.0685 1.0715 1.076
Support 1.0595 1.0545 1.049

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