The next resistance could be around 89.35

Varengold Bank Research Team from Varengold Wertpapierhandelsbank AG at 01/20/10

We wish you a good morning from Hamburg where the snow begins to thaw. Today we are expecting a lot of interesting economic data from the U.S. Furthermore the USD could reach a four month high against the EUR. However, much luck trading today.

The EUR dropped to its lowest level in more than four month versus the USD on concern Greece`s deteriorating financial situation will weigh on the region’s economic recovery. The USD reached 1.4188 against the EUR. Furthermore the JPY climbed to a four week high against the EUR, with the EUR/JPY falling to 129.83, on speculation that European Central Bank Executive Board Member Juergen Stark will reiterate the bearish outlook for the region’s economy and the budget deficit in Greece when he speaks today. The NZD dropped for a second day after a government report showed that consumer prices fell last quarter. This damping prospects for an interest rate increase. The USD gained to 0.7310 versus the NZD and the AUD slipped to 0.9194 USD.

The NZD dropped versus all of its 16 most traded counterparts after the statistics department said that consumer prices slipped 0.2% in the last quarter from the previous three month. The Reserve Bank of New Zealand Governor Alan Bollard, who predicted that the prices would fall, said last month the he expected to keep the interest rate at 2.5% until the middle of the year to help the economy recover from a recession.

After the first week of January, the CAD has been trading in bearish trend against the JPY and reached its level from the beginning of the year. Recently, the currency pair touched its support around 88.05 and could recover. Now it seems that the CAD is ready for a changing trend. A crossing MA Oscillator through the signal line from below may support that. The next resistance could be around 89.35.

With the beginning of the last week, the USD recovered from its bearish trend versus the CHF and has been trading in an upward trend. Currently, the currency pair touches it upper Bollinger Band. Three times before whenever the prices touched the upper Bolls the prices rebounded. Also the RSI may indicate a decreasing trend. It remains to be seen if the USD could confirm its trend at the actual level.