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USD Reaches 3 Month High

UFXBank Research from UFX Bank at 12/21/09


Daily Review 21/12/2009

USD Dollar (USD) – The Dollar reached a new 3 month high versus the Euro on Friday, heading toward the biggest weekly gain since April. The rise in risk aversion pushed the Dollar higher. Wall Street managed to end with gains on Friday after spending most of the session on the negative side. Dow Jones rose by 0.2% and NASDAQ gained 1.45%. Crude Oil jumped in more than 2% after Iranian soldiers took control of an oil well in a disputed section of the Iran-Iraq border region. The Gold (XAU) keeps up above the 1100$ level and closed at 1113$ an ounce. No economic data expected today.

EURO (EUR) – Concerns about the debt levels in European countries in recent weeks still affect the European currency and it dropped for a short term below the 1.43 level but succeeded to end the day above. The German IFO Business Climate Index came out 94.7 better than 94.5 expected but the Current Account came out much lower than forecast at -4.6B vs. -2B. Overall, EUR/USD traded with a low of 1.4260 and a high of 1.4411. No economic data expected today.
EUR/USD - Last: 1.4330

Resistance 1.44 1.45 1.459
Support 1.426 1.4175 1.413

British Pound (GBP) – The Sterling was under pressure reaching a fresh low of 1.6050, but was unable to remain below the 1.61 level. Business Investment came out -0.6% better than -2.8% expected. Overall, GBP/USD traded with a low of 1.6050 and a high of 1.6248. No economic data expected today.
GBP/USD - Last: 1.6240

Resistance 1.6165 1.6250 1.6320
Support 1.6050 1.6 1.5945

Japanese Yen (JPY) – The Dollar gained almost 1% versus the Japanese yen, after Bank of Japan left its call-rate target and economic assessment unchanged at 0.1% and signaled an extended continuation of easy monetary policy. The Bank of Japan emphasized the need to pull Japan out of deflation. Overall, USD/JPY traded with a low of 88.86 and a high of 90.89. Today, the BOJ monthly report is expected.
USD/JPY-Last: 90.40

Resistance 90.9 91.3 91.75
Support 90.25 89.95 89.4

Canadian Dollar (CAD) – The Canadian Dollar fell for a second week as global stocks slid and its US dropped on signs the American economic recovery is gaining momentum. Retail sales in Canada rose in October for the third straight month, coming out at 0.3% vs. 0.2% expected. Overall, USD/CAD traded with a low of 1.0628 and a high of 1.0724. Today, The Core Retail Sales expected at 0.5% vs. 1.1% previously.

USD/CAD - Last: 1.0670

Resistance 1.07 1.075 1.0825
Support 1.063 1.06 1.057

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