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USD Markets Finish Lower

UFXBank Research from UFX Bank at 01/13/10


Daily Review 13/01/2010

USD Dollar (USD) – The Dollar posted mix results across the board. US Markets finished lower, stocks declined by the end of today’s trading session after the worst than expected fundamentals released from the U.S. economy. Trade balance deficit came out at -36.4B in the month of November, worst than expected -34.5B. The Dow Jones fell by 0.34% and NASDAQ lost 1.30%. Commodities also fell. The Crude oil tumbled but managed to close above 80$ a barrel. Gold (XAU) collapsed and closed at 1127$ an ounce. Today, The Federal Budget Balance is expected at -92B vs. -120.3B previously.
EURO (EUR) – The Dollar rose against the Euro. The European currency failed to stay above the 1.4550 level and struggling to hold the critical support of 1.4480. Risk aversion could be extended in the market after bad reports that came out in the US also favoring the downside of the cross. On the technical view, if the 1.4480 level fails to hold, a downside back to 1.44 could be seen. Overall, EUR/USD traded with a low of 1.4452 and with a high of 1.4545. Today, The French CPI is expected at 0.3% vs. 0.1% previously.
EUR/USD – Last: 1.4480

Resistance 1.456 1.459 1.463
Support 1.4465 1.4415 1.4385

British Pound (GBP) – The Pound posted moderate gains against the Dollar and the Euro. The Sterling lost an upside momentum after renewed failure attempt of break above 1.6200 level and retraced to the 1.6150 level. The European Trade Balance index came out at -6.8B, better than the expected -7B. On the technical view, if the 1.6120 level fails to hold, a downside back to 1.6 could be seen. Overall, GBP/USD traded with a low of 1.6061 and a high of 1.6192. Today, The Manufacturing Production is expected at 0.3% vs. 0% previously.
GBP/USD - Last: 1.6065

Resistance 1.624 1.6275 1.6315
Support 1.612 1.6065 1.6025

Japanese Yen (JPY) – The Dollar traded near a three-week low against the Yen on speculation the Federal Reserve will extend its stimulus programs amid signs of the slowing U.S. economic recovery. The Japanese currency rose across the board on the day that the central bank of China announced an increase of 0.50% on reserves requirement for commercial banks. On the technical view, a downtrend back to 90 could be seen as long as the pair below the 91.8. Overall, USD/JPY traded with a low of 90.70 and a high of 92.41.
USD/JPY-Last: 91

Resistance 91.3 91.75 92
Support 90.65 90.3 89.85

Canadian dollar (CAD) – The Dollar rose against the commodities-currencies, including the Canadian Dollar. Canada’s Dollar fell the most in almost two weeks as commodities tumbled and the nation unexpectedly posted a trade deficit, spurring speculation the economic recovery may not be as robust as investors anticipated. The Trade balance came out -0.3B worse than expected 0.9B. On the technical view, sustaining above 1.0380 can add to the upside momentum running to 1.05. Overall, USD/CAD traded with a low of 1.0312 and with a high of 1.0412.
USD/CAD - Last: 1.04

Resistance 1.041 1.0455 1.049
Support 1.035 1.0315 1.029

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