Major Market Mover: Growth And Housing!

Today is another added day to the ever lasting dollar weakness; providing more numbered facts that the Fed is to further deepen their key rate cuts. Slowdown is projected to have broadened the fall in August, as we have key housing data today in addition to the final GDP reading for the second quarter, as well key inflationary readings.

Despite the fact that the data covers a period prior to the Fed’s implemented cut yet market are merely comprehending a continuation pattern to become a series of cuts on key rates. Today’s August’s New Home Sales are expected to have dropped 5.2% to an annualized rate of 825 thousand, and the slumping sector remains the blister that is the entire economy’s sore of anguished losses. After we have seen a deep drop in Durable goods yesterday the comprehension of a sluggish economic expansion to come and explaining the 50 basis points cut.

Reaching to growth that has soared to 4.0% in the preliminary reading boosted by a leap in exports as robust global growth combined with a weak dollar has flourished a key exit to the slump; with some stability seen in the trade balance figures today’s final GDP reading is expected to be revised slightly down to an annualized rate of 3.8 percent, in addition to solid readings and no revisions to be seen to the personal consumption as well on core levels staying as is at 1.4% and 1.3% respectively.

The dollar is still on a losing streak against majors and weak data still fortifies expectations of and extended track to the downside, if we just look at it from rate differentials angle we see expectations of rate cuts on federal ground and hikes in the 13 nation that has already soared almost 4.2% versus the dollar in the past three months alone.

As we have mentioned earlier the gap in time at hand between fundamental readings and implemented action in real will create this sort of discarding to actual figures and comprehension to expectations and projections to future monetary policy headings; which at last remains to a weak greenback, so stay aboard the broader picture and enjoy the record high as we see the economic developments world wide affected by the happenings on US soil…

crosses technical analysis 28-09-2007

GBP/JPY

The Pound against the Yen pair started heading towards the downside in a correctional move, yet the general trend remains to the upside and the first target is set to be the 234.85, and the point at 232.53 seems to offer good demand for the pair.

EUR/JPY

The Euro also declined against the Yen, as the technical indicators is still showing a bullish wave, and now the 164.79 level is set to be the first target for the pair, and the point at 162.72 seems to offer good demand for the pair.

EUR/GBP

The Euro is still consolidating against the Pound, as the pair is still able to hold onto its gains, and the technical indicators are still showing the upside movement, and the point at 0.6982 seems to offer good demand for the pair.

Major Technical analysis 28-09-2007

euro

The European currency had tendency to move in an upside pattern after it made the suitable correction with some consolidation yesterday. Moreover, the euro succeeded in getting some new high records until the levels of 1.4180. Today we expect the euro to progress towards the upside as well.
The trading range for today might be between the key resistance level at 1.4220 and the key support level at 1.4060.
The general trend is up as far as 1. 3270 remains intact targets now at 1.4050 and 1.4220.
We expect buying Euro above 1.4135 with a target at 1.4190 stop loss below 1.4100.

gbp

The British pound yesterday managed a strong upside move after successfully passing the major level at 2.0180s, the same level which forced the pound to consolidate below it two days ago. Today the pound is expected to progress towards the upside.
The trading range for today might be between the key resistance level at 2.0380 and the key support level at 2.0120.
The general trend is up as far as 1.9700 remains intact targets now at 2.0635 and 2.0740.
We expect buying sterling above 2.0255 with a target at 2.0350 stop loss below 2.0210

jpy

The dollar against the Japanese yen last time tended to move in a balanced pattern however it hit the upper strong resistance at 115.80s. The pair moved in the upside direction with not enough momentum which might lead the currency towards the downside today.
The trading range for today will be between the key resistance at 116.50 and the key support at 114.50.
The general trend is down as far as 124.60 remains intact, targets at 112.40 and 111.20
We expect selling USD/JPY below 115.85 with a target at 115.00, stop loss above 116.35.

Market Comment

The Developing Storm

The housing situation is continuing to worsen, and it is spreading to the rest of the economy, increasing the probability of a recession that has not been factored into the stock market. August new single-family home sales were down 8.3% from July and off 21.2% from a year earlier to the lowest level in seven years. Median prices were down 7.5% year-to-year with inventories of unsold homes rising to an 8.2-month supply. This reinforces the previously released data on August existing home sales, which declined 4.3% for the month and 13% from a year earlier to the lowest level since mid-2002. Continuing volume weakness, tighter mortgage credit, weak pricing and ongoing mortgage resets are likely to lead to more mortgage credit problems and foreclosures that will keep economic and financial risks high.

The industry data was confirmed by individual companies as well. Lennar reported a record loss attributable to a drop in sales prices, a decline in home deliveries and heavy write-downs. The company said it has cut its workforce by 35% this year and expects to pare more employees soon. CEO Stuart Miller stated “Overall, the supply of homes to sell continues to climb in many of our markets and we’re not yet able to get a good reading on how quickly the inventories will be absorbed or whether it will continue to increase as foreclosures increase and add to inventory.” Lennar reported that new home orders were down 28% with a cancellation rate of 32%. Similarly, KB Homes reported a big third quarter loss with CEO Jeffrey Mezger stating “We see no signs that the housing market is stabilizing in the near future.” In addition the Case-Shiller 10-metro housing price index dropped 4.4% in July while the 20-metro index declined 3.9%. This happened prior to the August credit market upheaval that probably made things even worse. It is notable that the NAHB housing index recorded its lowest level on record for September in every subcategory.

The severe housing slump is already beginning to hit consumer spending. The International Shopping Center Chain Store Index has now declined more than 1% for two straight weeks for the first time since December 2004, and has broken down to its lowest level of the year as a result of slower job growth, a diminishing wealth effect, record debt burdens, little savings cushion and high energy prices. Target has reduced its September forecast of same-store sales growth to 1.5-to-2.5% from a previous 4-to-6% while a number of other retailers have reduced their estimates as well. Furthermore, ISI Group points out that a revision of mortgage equity extraction (MEW) estimates has further negative implications for the consumer spending outlook. The 2006 peak for MEW has been raised to almost $1 trillion with the second quarter 2007 estimate still at a relatively high $500 million. ISI states that that this means the coming decline in MEW will be greater than previously estimated, increasing the coming hit to consumer spending.

Furthermore, the developing economic weakness is not restricted to housing and consumer spending. Core new orders for durable goods fell 0.7% in August and are down 2% since year-end, indicating future weakness in capital goods expenditures. The economy.com survey of business confidence has been falling sharply, also not a good omen for employment or capex. ISI Group also points out that the Conference Board leading indicators have been unchanged for 21 months. That has proven to be a recessionary signal in the past. In addition, we note that the OECD leading indicator has been declining significantly while Japan’s GDP has declined in the most recent reported quarter.

In our view, therefore, the chance of recession is high and will not be stopped by the current Fed rate cut or those to come. History indicates that once recessionary forces take hold they play out despite any moves by the central bank. In addition, since the stock market has not discounted a recession the downside risks are high. The last eight recessions were associated with an average market decline of 30%. In comparison the S&P 500 at its low a few weeks was only about 10% below its peak. The current rally has been a psychological reaction to the Fed rate cut and is likely to lose momentum soon as economic reality sets in. Market observers seem to have the same faith in the Fed that four-year olds have in their mommies and daddies. Although we all wish that the Fed could wave a magic wand and make everything OK, that is not the way the economy or the markets work, and eventually we have to face reality.

crosses technical analysis 27-09-2007

GBP/JPY

The pair started its incline after it bypassed the 232 barrier, heading now to the major pivot point at 235.50, the technical indicators started to adjust to give more strong signals to the upside while the volume is giving the pair some momentum. The point 233.00 seems to offer the first demand point.

EUR/JPY

The European currency is still gaining against its all mates, and the Japanese yen had its share, after breaking the 161.90 level the pair is heading now towards the 164.50, and eventually to the all time high at 169.00 almost. The technical indicators started to give some more powerful signals to the upside. And the level 163.30 seems to offer the first demand for the pair.

EUR/GBP

The European currency declined slightly today after reaching above the 0.7000 barrier earlier this week, the decline was based on some strength the British Pound that he gained from strong houses data. Yet the pair is still above the 0.6990 which make this decline just a slight correction with a demand on this particular level.

Major Technical analysis 27-09-2007

euro

The European currency saw the tendency to move towards the downside hitting the key support at 1.4100, then it managed an upside move until the levels of 1.4130s. Nevertheless, the upside potential is still possible and the Euro just consolidated at the top to gather some strength to move in a bullish trend again.
The trading range for today might be between the key resistance level at 1.4220 and the key support level at 1.4060.
The general trend is up as far as 1. 3270 remains intact targets now at 1.4050 and 1.4220.
We expect buying Euro above 1.4110 with a target at 1.4180 stop loss below 1.4075

gbp

The British pound consolidated at the critical level of 2.0150s. Meanwhile, the pound is still has the upside potential as long as it stays above the major level at 2.0070s.
The trading range for today might be between the key resistance level at 2.0260 and the key support level at 2.0040.
The general trend is up as far as 1.9700 remains intact targets now at 2.0635 and 2.0740.
We expect buying sterling above 2.0120 with a target at 2.0220 stop loss below 2.0070

jpy

The dollar against the Japanese yen yesterday moved in a bullish pattern ignoring the strength of the major resistance level at 115.15, so it managed to drive through the upside channel to hit the upper resistance level at 115.70s. The pair today is expected to progress towards the upside as long as it has high levels of volume.
The trading range for today will be between the key resistance at 116.70 and the key support at 114.00.
The general trend is down as far as 124.60 remains intact, targets at 112.40 and 111.20.
We expect selling USD/JPY below 116.20 with a target at 115.50, stop loss above 116.65

Major Market Mover: Growth And Housing!

Today is another added day to the ever lasting dollar weakness; providing more numbered facts that the Fed is to further deepen their key rate cuts. Slowdown is projected to have broadened the fall in August, as we have key housing data today in addition to the final GDP reading for the second quarter, as well key inflationary readings.

Despite the fact that the data covers a period prior to the Fed’s implemented cut yet market are merely comprehending a continuation pattern to become a series of cuts on key rates. Today’s August’s New Home Sales are expected to have dropped 5.2% to an annualized rate of 825 thousand, and the slumping sector remains the blister that is the entire economy’s sore of anguished losses. After we have seen a deep drop in Durable goods yesterday the comprehension of a sluggish economic expansion to come and explaining the 50 basis points cut.

Reaching to growth that has soared to 4.0% in the preliminary reading boosted by a leap in exports as robust global growth combined with a weak dollar has flourished a key exit to the slump; with some stability seen in the trade balance figures today’s final GDP reading is expected to be revised slightly down to an annualized rate of 3.8 percent, in addition to solid readings and no revisions to be seen to the personal consumption as well on core levels staying as is at 1.4% and 1.3% respectively.

The dollar is still on a losing streak against majors and weak data still fortifies expectations of and extended track to the downside, if we just look at it from rate differentials angle we see expectations of rate cuts on federal ground and hikes in the 13 nation that has already soared almost 4.2% versus the dollar in the past three months alone.

As we have mentioned earlier the gap in time at hand between fundamental readings and implemented action in real will create this sort of discarding to actual figures and comprehension to expectations and projections to future monetary policy headings; which at last remains to a weak greenback, so stay aboard the broader picture and enjoy the record high as we see the economic developments world wide affected by the happenings on US soil…

Week of 9/24/2007 thru 9/28/2007

Monday, September 24, 2007

Economic 11:00am 2 and 5 year announcement (expected unchanged at $18 and $13B respectively) 1:00pm 3 and 6 month bill auction
Events9:00am Fed’s Fisher speaks in Dallas on Higher Education, 9:30am Fed Board holds public meeting on Banking Regulations,FDA Joint Regulatory Conference on evolving regulatory expectationsincluding first cycle approval, IQPC Credit Derivatives Conference,Sidoti & Co San Francisco Investor Forum, Piper Jaffray Solar PowerConference, Trades Ex-dividend: TW $0.006. PRD $0.438
EarningsBefore the Open: ALOG After the Close: LTRE, SNX

Tuesday, September 25, 2007

Economic10:00am Sep Consumer Confidence (last 105.0), Sep Richmond Fed ManufacturingIndex (last 7), Aug Existing Home Sales (last 5.75M, m/m –0.2%),
Events5:30pm Plosser speaks on productivity,Friedland Capital Inc Undervalued Equities Conference, WiMAX World USA,CFO European Summit, ICSC/UBSW Chain Store Sales (7:45, last 2.4%).Redbook Retail Sales (8:55, last %). ABC Consumer Confidence (last-15). Trades Trades Ex-dividend: LM $0.24, SWY $0.069, SRE $0.31, THO$2.07, UVE $0.08
EarningsBefore the Open: FDS, LEN, MCS After the Close: CPRT, FUL, RHT, RECN, SMSC, WOR

Wednesday, September 26, 2007

Economic8:30am Aug Durable Goods orders (last 5.9%), Aug Durables ex Transportation (last 3.7%) 10:30am Crude Oil/Gasoline/Distillate Inventories1:00pm 2-year note auction
Events 8:30am Fed’s Poole,Freddie Mac quarterly funding announcement, CIBC World Markets EasternInstitutional Investor Conference, Massachusetts Biotechnology Council9th advanced forum on Biotech, MBA Mortgage Applications (7:00, last%). Trades Ex-dividend: ACE $0.27, AYR $0.65, BXP $0.68, CCU $0.188, DE$0.50, EIX $0.29, FITB $0.42, FRP $0.398, GNI $2.80, ITW $0.28, JTX$0.18, NUE $0.61, TDK $0.461, DOW $0.42, USB $0.40
Earnings Before the Open: ATU After the Close: BBBY, INTV, PAYX, XRTX

Thursday, September 27, 2007

Economic8:30am 2Q FinalGDP Annualized (last 4.0%), 2Q Final GDP Price Index (last 2.7%), 2QFinal Personal Consumption (last 1.4%), 2Q Final Core PCE q/q (last1.3%), Initial Jobless Claims (last 311K), Continuing Claims (2.54M)10:00am Aug New Home Sales (last 870K, m/m last 2.8%), Aug Help Wanted Index (last 25) 10:30am Natural Gas Inventories 1:00pm 5-year note auction
Events5:30pm Fed’s Mishkin speaks on domestic prices,Deutsche Bank Securities Global Oil & Gas Conference, Bear Stearns& Co, Inc US Rates London Conference, Trades Ex-dividend: CAH$0.12, CCZ $0.414, HOG $0.30, OMX $0.15, TYC $0.15
EarningsBefore the Open: CHTT, CRAI, KBH, MKC, RAD, TXI, MTN After the Close: ACN, CBK, CTAS, COGN, CREL, ESIO, FINL, GPN, HMX, JBL, PLL, TIBX

Friday, September 28, 2007

Economic 8:30am Aug Personal Income (last 0.5%), Aug Personal Spending (last 0.4%), AugPCE Deflator (y/y last 2.1%), Aug PCE Core (y/y last 1.9%, m/m last0.1%)9:45 Sep Chicago PMI (last 53.8)10:00 Aug Construction Spending m/m (last –0.4%), Sep U. of Michigan ConsumerConfidence (last 83.8), Sep NAPM – Milwaukee (last 63.0)
Events10:00amFed’s Lockhart speaks on the economy, 10:15am Yellen speaks onbehavioral economics, 5:00pm Fed’s Poole speaks on Central Banking, First Energy Capital Global Energy Conference Trades Ex-split: FCSX 3-2. Trades Ex-dividend: RJF $0.10
Earnings Before the Open: AZZ . After the Close: none seen.

Crosses technical analysis

GBP/JPY

The Pound gained against the Yen, and started heading towards the upside, the general trend is to the upside, as targets are now set at 233.53 then 235.02, and the point at 232.53 seems to offer strong demand for the pair.

EUR/JPY

The Euro gained as well against the Yen last week, yet the pair declined back, the upside trend is the valid one, and the point at 161.61 seems to offer strong demand for the pair

EUR/GBP

The Euro dropped slightly against the Pound, as the pair started a correctional move in order to gather some momentum to progress to the upside, and the point at 0.6941 seems to offer good demand for the pair.

Major technical analysis 24-09-2007

euro

The European currency managed to move in an irregular movement last week to record and all time high. Today the euro is expected to continue the upside move as the euro couldn’t breach the major up trend line beside the technical parameters that indicate the upside potential until 1.4200 levels . The trading range for today might be between the key resistance level at 1.4250 and the key support level at 1.4050. The general trend is up as far as 1.3600 remains intact targets now at 1.4500 and 1.4885.
We expect buying Euro above 1.4100 with a target at 1.4175, stop loss below 1.4070

gbp

The British pound managed to move towards the upside in a bullish pattern after it built the base above the major level last week at 2.0200. However, the pound has a tough level at 2.0280 that might bother the pound while in its upside move. The trading range for today might be between the key resistance level at 2.0335 and the key support level at 2.0160.
The general trend is up as far as 1.9650 remains intact targets now at 2.0635 and 2.0740.
We expect buying sterling above 2.0120 with a target at 2.0280, stop loss below 2.0080

jpy

The dollar against the Japanese yen arranged a strong drop with high levels of volume and volatility. Due to that, the pair hit the low at 114.60 last Friday. Today the pair seems to continue towards the major support at 114.20s. The trading range for today will be between the key resistance at 115.70 and the key support at 114.00.The general trend is down as far as 124.60 remains intact, targets at 112.60 and 111.30.
We expect selling USD/JPY below 115.20 with a target at 114.50, stop loss above 115.60

crosses technical analysis 21-09-2007

GBP/JPY

The Pound against the Yen pair is still consolidating, yet the general trend for the pair remains to the upside, and the point at 230.98 seems to offer good demand for the pair.

EUR/JPY

The Euro declined slightly against the Yen, in a correctional move for the pair, yet targets remain at the 162.91 then 163.80, and the point 161.65 seems to offer good demand for the pair.

EUR/GBP

The Euro against the Pound pair declined back, as the momentum indicators show the pair was in an overbought area, yet the general trend for the pair is still to the upside, and the point at 0.6972 seems to offer good demand for the pair.

Major Technical analysis 21-09-2007

euro

Obviously the European currency managed to hit new records yesterday in the absence of the US dollar strength, the slope’s steep angle to the upside wave shows the strength of this move which is expected to push the Euro up until the 1.4140s strong resistance level.
The trading range for today might be between the key resistance level at 1.4150 and the key support level at 1.3950.
The general trend is up as far as 1.3600 remains intact targets now at 1.4500 and 1.4885.
We expect buying Euro above1.4040 with a target at 1.4140, stop loss below 1.3985.

gbp

The British pound managed to move towards the upside in a bullish pattern after it built the base above the major support level yesterday at 1.9970 to hit the key resistance level at 2.0140s, today we expect the pound to continue towards the upside as long as it stays above 2 dollar barrier.
The trading range for today might be between the key resistance level at 2.0235 and the key support level at 1.9970.
The general trend is up as far as 1.9650 remains intact targets now at 2.0635 and 2.0740.
We expect buying sterling above 2.0075 with a target at 2.0210, stop loss below 2.0020.

jpy

The dollar against the Japanese yen arranged a strong drop with high levels of volume and high volatility, due to that the pair hit the unexpected low at 114.00; therefore today the pair seems to continue towards the major support at 113.30s.
The trading range for today will be between the key resistance at 115.40 and the key support at 113.00.
The general trend is down as far as 124.60 remains intact, targets at 112.60 and 111.30.
We expect selling USD/JPY below 114.80 with a target at 113.50, stop loss above 115.40

Forex Market Summary

U.S. Dollar Trading (USD) eased further overnight on ongoing speculation that the Federal Reserve will continue to reduce interest rates, dwindling any demand for the USD. Bearish sentiment was re-iterated with reports circulated that Saudi Arabia will look to cease its peg with the USD due to the recent dollar weakness. In data news, the Conference Board’s index of leading U.S. economic indicators fell 0.6 percent in August, the most in six months. In his address to congress, Bernanke highlighted the Fed’s concern with any repeat in sub-prim mortgage rout, stating ‘we will use our rulemaking authority’ to ‘propose additional consumer protections later this year’. In U.S share markets the NASDAQ was down 12.19 (-0.46%) whilst the Dow Jones also declined 48.86 (-0.35%). Crude oil fell by US$0.11 a barrel to US$81.67 having traded at a fresh record high of US$83.90.

The Euro (EUR) reached a fresh record high, breaking through key 1.40 levels in the early part of the European session. The Euro was buoyant against the greenback having gained 6.2% for the year. Overall the EURUSD traded with a low of 1.3964 before and a high of 1.4099 before closing the day at 1.4040 in the New York session. Looking ahead key data is due out of the EZ in the form of Current Account and PMI.

The Japanese Yen (JPY) gained 1.3% against the USD on speculation the Federal Reserve will continue to reduce rates. Yen buying by Japanese individual investors reached a three-month high of $1.57 billion yesterday, figures from the Tokyo Financial Exchange indicate. Overall the USDJPY traded with a range of a low 115.30 and a high of 116.04 before closing the day at 115.57 in the New York session.

The Sterling (GBP) paired its previous session losses rebounding well above the $2 levels. The Pound was supported by a report which showed retail sales unexpectedly increased in August, making it less likely the Bank of England will cut interest rates by year end. In other news, BoE Governor Mervyn King today defended policy makers’ actions in the bailout of Northern Rock Plc to a parliamentary committee. King said British and European Union laws ‘made it almost impossible for us to act as a lender of last resort in the way that I would prefer’. Overall the GBPUSD traded with a low of 1.9974 and a high of 2.0114 and a low of 2.0080 in the New York session.

The Australian Dollar (AUD) gained over night on a broadly weaker dollar boosted by a demand in commodities. Overall the AUDUSD traded with a low of 0.8553 and a high of 0.8633 before closing the day at 0.8622 in the New York session.

The Canadian Dollar (CAD) traded equal to the U.S. currency for the first time in three decades, capping a five-year run on the back of booming demand for the nation’s commodities. Parity symbolizes Canada’s emerging clout in a world economy increasingly short of the energy, grains and metals the country produces. Canada, the world’s eighth-biggest economy, has benefited from rising demand for copper, gold, wheat and oil from neighboring U.S. and emerging economies such as India and China. Overall the USDCAD traded with a low of 0.9992 and a high of 1.0156.

Gold (XAU) rose to a 27-year high up 2 percent to $735.85 an ounce, it’s highest since January 1980, when it hit a record high of $850. XAU traded with a low of 721.50 and a high of 738.30.

Major Market Mover: Readings… After Cut!

What’s done is done and the Feds took us all by surprise last night indeed with their drastic measures taken to ensure the wellbeing of their economy and anchoring the ghost of recession, taking their key rates to 4.75 percent and yet the Board of Governors took another 50 basis points off their discount rate…

The statement’s rhetoric did in fact as expected take desperate alteration as their focus on the ongoing correction in the housing market and credit squeeze that have the potential to restrain economic growth. Their dovish alteration didn’t at all withhold their constant watch on inflation, acknowledging the fact that it did moderate while the risks still remain; the committee judges that they need to thoroughly anticipate economic developments on ground and world wide as well.

The aftermath of the 50 basis points is still to be locked in the market and greenback has never looked weaker; today’s inflation readings come as the first sign after the decision and all is significant at this stage, for assessing the entire economic picture starts to build up form now.

Yesterday the PPI readings showed slowing especially on food and energy, while stability was seen on core levels. On the queue we have today the consumer counterpart and that is the CPI for August to come in flat on the month and slightly lower on the year at 2.2% from 2.4%; while on the core levels stability is expected with 0.2% on the month and 2.2 percent on the year.

The housing data is still the markets rich chocolate cake as today we also have key data that still defines the ongoing trend especially that they are the first on hand for the turmoil month, August. Permits are expected to have edged down further to 1345 thousand from 1373 K showing that the devastated sentiment in the housing sector is reflected yet further into futuristic expectations, and that is further downside trend; housing starts are also to have taken a hit sliding to 1350K from 1381 thousand. The initial readings for August such as the jobs report reflected the economic conditions have deteriorated massively and to that even those slowing expected readings on housing seem the brightest optimistic for now so the actual readings today might reflect some further damage.

Keep your senses with the market, as majors acquire massive bullish momentum against the dollar, and new records are about to be set in the markets that you don’t want to miss. All counts now and the jitters are fading away as common sense once again is arising to surface…

Major Technical analysis 19-09-2007

euro

The technical indicators yesterday showed the upside potential for the European currency driving it through the upside channel with high momentum. The Euro was able to hit but not breach the major resistance level at the major upside trend line at 1.4000. If this resistance level is breached, the Euro might continue to progress today.
The trading range for today might be between the key resistance level at 1.4150 and the key support level at 1.3900.
The general trend is up as far as 1. 3270 remains intact targets now at 1.4050 and 1.4220.
We expect buying Euro above 1.3960 with a target at 1.4020 stop loss below 1.3915.

gbp

The British pound moved towards the upside hitting the key resistance level at 2.0150s in a strong bullish pattern. That might be a step to hitting some new records in the short term period. On the other hand, the technical parameters got ready to show some bullish signs as we mentioned above.
The trading range for today might be between the key resistance level at 2.0260 and the key support level at 2.0040.
The general trend is up as far as 1.9700 remains intact targets now at 2.0635 and 2.0740.
We expect buying sterling above 2.0100 with a target at 2.0180 stop loss below 2.0040.

jpy

The dollar against the Japanese yen yesterday moved in a bullish pattern ignoring the strength of the major resistance level at 115.40s, so it managed to drive through the upside wave to hit the upper resistance level at 116.30s. The pair today is expected to progress towards the upside as long as it has the high level of volume.
The trading range for today will be between the key resistance at 116.70 and the key support at 114.00.
The general trend is down as far as 124.60 remains intact, targets at 112.40 and 111.20.
We expect selling USD/JPY below116.60 with a target at 115.50, stop loss above 117.15

crosses technical analysis 19-09-2007

GBP/JPY

The Pound gained back against the Yen, as investors started a selling wave on the Yen, now targets are set at the 234.95 then 235.72, and the point at 232.53 seems to offer strong demand for the pair.

EUR/JPY

The Euro continued to incline against the Yen, as the pair breached the 160.00 resistance level and progressed the upside channel, the first target is now set at 162.91, and the point 161.45 seems to offer strong demand for the pair.

EUR/GBP

The Euro against the Pound pair, started heading towards the downside affected by profit taking transactions, the general trend for the pair is still to the upside, targets are set at 0.6952 then 0.6967, and the point at 0.6930 seems to offer good demand for the pair.

Weekly Calendar

Week of 9/17/2007 thru 9/21/2007

Monday, September 17, 2007

Economic
8:30am Sep Empire Manufacturing (last 25.1)
1:00pm 3 and 6 month bill auction

Events
Bank of America Securities 37th Annual Investor Conference, Financial Research Associates Biofuels Marketing & Distribution Conference, Credit Suisse 2007 Homebuilders Conference. Trades Ex-split: LPHI 5-4 Trades Ex-dividend: DTE $0.53, GES $0.08

Earnings
After the Close: ADBE

Tuesday, September 18, 2007

Economic
8:30am Aug PPI (m/m last 0.6%, y/y last 4.0%), Aug PPI Ex Food and Energy (m/m last 0.1%, y/y last 2.3%)
9:00am Jul Net Long Term TIC Flows (last $120.9B), Jul Total Net TIC Flows (last $58.8B) 1:00pm Sep NAHB Housing Index (last 22)
2:15pm FOMC Rate Decision (prior 5.25%)

Events
9:00am Fed’s Open Market committee meets on interest rates, economy, Apple UK press event, Euromoney Total Derivatives Fixed Income Forum, A.G Edwards Emerging Growth Conference, Piper Jaffray Financial Services Private Equity Conference, ICSC/UBSW Chain Store Sales (7:45, last 0.3%). Redbook Retail Sales (8:55, last 2.8%), ABC Consumer Confidence (last -17 ). Trades Ex-split: LABL 3-2 Trades Ex-dividend: GKSR $0.05, HOMF $0.2, IIG $0.11, SNV $0.205, TIF $0.15, TSYS $0.07, OMC $0.15
Earnings
Before the Open: AHII, AZO, BKRS, BBY, CBRL, KR, LEH . After the Close: DRI

Wednesday, September 19, 2007

Economic
8:30am August CPI (m/m last 0.1%, y/y 2.4%), August CPI ex Food and Energy (m/m 0.2%, y/y 2.2%), Aug Housing Starts(last 1.38M), Aug Building Permits(last 1.37M)
10:30am Crude Oil/Gasoline/Distillate Inventories

Events
8:00am FDA Panel for circulatory system devices (REPEL-CV), Deutsche Bank Securities Emerging Europe Conference, Friedland Capital Inc Alternative Energy Conference, MBA Mortgage Applications (7:00, last 5.5%). Trades Ex-dividend: AAP $0.06, CBK $0.06, CB $0.290, HNZ $0.38, MBI $0.34, CINF $0.355, TROW $0.17

Earnings
Before the Open: AIR, KMX, DBRN, GIS, MS, POSS, SMTS After the Close: APOG, CKR, CLC, CMTL, MLHR

Thursday, September 20, 2007

Economic
8:30am Initial Jobless Claims (last 319K), Continuing Claims (last 2.585M)
10:00am Aug Leading Indicators (last 0.4%)
10:30am Natural Gas Inventories
12:00pm Sep Philadelphia Fed (last 0.0)

Events
8:00am FDA Panel for circulatory devices (recommendations on trial designs for cardiac ablation devices),10:00am Fed’s Bernanke testifies before the House Financial Services Committee, UBS London CDO Conference, NASD Advertising Regulation Conference, Credit Suisse Group September Hedge Fund Forum Trades Ex-dividend: DDR $0.66, GE $0.28, WMG $0.13, OLP $1.03

Earnings
Before the Open: AM, BSC, CCL, CC, CAG, FDX, GS, NSSC, PIR, PRGS, SCHL, SCS During Market Hours: AGE After the Close: COMS, CHAP, CSC, DMND, DDMX, EGLS, HIS, NKE, OPTM, ORCL, SNX, THO

Friday, September 21, 2007

Economic
None Seen

Events
5:00am Fed’s Mishkin speaks on monetary policy in Germany, 8:45am Fed’s Plosser makes opening remarks at Philadelphia Conference, 1:00pm Fed’s Warsh speaks on Financial Market Developments in Albany, S&P 400,500,600 re-balancing based on data provided Wed Sept 19th, Deutsche Bank Macau Gaming & Property Conference Trades Ex-dividend: FOR $0.045, MBJ $0.067

Earnings
During Market Hours: TONS

crosses technical analysis 18-09-2007

GBP/JPY

As investors bought back the Yen, the Pound dropped heavily against it, taking the GBP/JPY pair back to the 229s level, the general trend is still to the upside, and the point at 228.64 seems to offer good demand for the pair.

EUR/JPY

The Euro declined against the Yen as well, after the pair could not breach the 160.02 level yesterday, the general trend is still to the upside, and the point at 158.56 seems to offer good demand for the pair.

EUR/GBP

The Euro continued gaining against the Pound, and reached the long term target at 0.6956 yet could not hold above it, the point at 0.6930 seems to offer good demand for the pair.

Major Technical analysis 18-09-2007

euro

The European currency consolidated at the top of the last bullish move after it hit the major resistance level at 1.3920s last week and obviously lost some volume. Therefore, we expect a bearish day as long as the major support level at 1.3830s was breached down today.
The trading range for today might be between the key resistance level at 1.3950 and the key support level at 1.3770.
The general trend is up as far as 1.3300 remains intact targets now at 1.3920 and 1.4045.
We expect selling Euro below 1.3880 with a target at 1.3810, stop loss above 1.3930

gbp

The British pound dropped down in a strong bearish pattern with high volume. This might be a signal to open the way towards the target at 1.9800, which is the next support level. In the meantime, the technical indicators show some bearish adjustments as well for today.
The trading range for today might be between the key resistance level at 2.0100 and the key support level at 1.9770.
The general trend is up as far as 1.9650 remains intact targets now at 2.0635 and 2.0740.
We expect selling sterling below 1.9970 with a target at 1.9830, stop loss above 2.0020

jpy

The dollar against the Japanese yen tended to progress towards the upside in order to cover some of the bearish losses two weeks ago. The technical indicators started adjusting to show the upside potential, but the pair just touched the major downside trend line which in role stopped the upside move to force the pair to drop down today.
The trading range for today will be between the key resistance at 116.00 and the key support at 114.50.
The general trend is down as far as 124.60 remains intact, targets at 112.60 and 111.30.
We expect selling USD/JPY below 115.40 with a target at 114.70, stop loss above 115.80.

crosses technical analysis 17-09-2007

GBP/JPY

The Pound against the Yen is still consolidating, as the pair is yet to gather some momentum to progress the upside channel, the general end is still up, and the point at 229.88 seems to offer strong demand for the pair.

EUR/JPY

The Euro inclined against the Yen, and the targets at 160.55 and 161.44 are now close, the general trend is still up, and the pair resides around the 200 moving average at 160.00, and the point at 159.35 seems to offer strong demand for the pair.

EUR/GBP

The Euro continued to incline heavily against the Pound, and the technical indicators show the pair is in an overbought area, yet the target remains at the 0.6956 level, and the point at 0.6904 seems to offer good demand for the pair.

Major Technical analysis 17-09-2007

euro

The European currency fluctuated in a balanced move last Friday with some tendency towards the upside to close at 1.3870s after it hit the major support at 1.3840s. This move might be a signal for moving towards the upside today as long as it stays above 1.3840s.
The trading range for today might be between the key resistance level at 1.3950 and the key support level at 1.3770.
The general trend is up as far as 1.3300 remains intact targets now at 1.3920 and 1.4045.
We expect buying Euro above 1.3860 with a target at 1.3910, stop loss below 1.3815.

gbp

The British pound couldn’t breach the upside resistance at 2.0220s to extend the downside channel until the levels of 2.0050s. Nevertheless, the pound dropped last Friday with slight levels of volume; which in role pushed the pound to the upside today.
The trading range for today might be between the key resistance level at 2.0150 and the key support level at 1.9980.
The general trend is up as far as 1.9650 remains intact targets now at 2.0635 and 2.0740.
We expect buying sterling above 2.0065 with a target at 2.0120, stop loss below 2.0000.

jpy

The dollar against the Japanese yen tended to progress towards the upside in order to cover some of the losses two weeks ago. The technical indicators started adjusting to show the upside potential, but the pair just touched the major downside trend line which stopped the upside move to force the pair to drop down today.
The trading range for today will be between the key resistance at 116.00 and the key support at 114.50.
The general trend is down as far as 124.60 remains intact, targets at 112.60 and 111.30.
We expect selling USD/JPY below 115.40 with a target at 114.70, stop loss above 115.80.

What is Forex ?

The foreign exchange (also known as "forex" or "FX") market is the place where currencies are traded. The overall forex market is the largest, most liquid market in the world with an average traded value that exceeds $1.9 trillion per day and includes all of the currencies in the world.