Message-ID: <5032372.1075861043461.JavaMail.evans@thyme> Date: Mon, 25 Feb 2002 04:41:56 -0800 (PST) From: info@forexnews.com To: sara.shackleton@enron.com Subject: US Trading Preview Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: quoted-printable X-From: <info@forexnews.com>@ENRON X-To: Shackleton, Sara </O=ENRON/OU=NA/CN=RECIPIENTS/CN=SSHACKL> X-cc: X-bcc: X-Folder: \Sara_Shackleton_Mar2002\Shackleton, Sara\Deleted Items X-Origin: Shackleton-S X-FileName: sshackl (Non-Privileged).pst [IMAGE] Forums Discuss these points in the Forums: Forexnews Forum T= echnicals Live Charts Analysis available from: Cornelius Luca J.P. Chorek= Technical Research Ltd. Charts & News featuring Standard & Poor's = Interest Rates US: Japan: Eurozone: UK: Switzerland: 1.75% 0.15% 3.= 25% 4.0% 1.25-2.25% [IMAGE] =09 [IMAGE] USD and JPY Rangebound Ahe= ad of Greenspan and Japan February 25, 7:00 AM: EUR/$..0.8735 $/JPY..133.8= 9 GBP/$..1.4290 $/CHF..1.6918 USD and JPY Rangebound Ahead of Greenspan an= d Japan by Jes Black At 10:00:00 AM US Jan Existing Homes (exp 5.2 mln, pr= ev 5.19 mln) The dollar recouped about half of Friday's losses against the= euro and sterling but remained mired in recent ranges ahead of this week's= key policy meetings and economic data. Fed chairman Greenspan is set to sp= eak on Wednesday and upbeat US data are expected to allow the chairman to t= ake an optimistic tone. But accounting concerns have so far constrained the= dollar despite signs of a nascent recovery. EUR/USD fell to a day's low = of 87.33 but maintained above support at 87.35/40. A break of 87.40 targets= 87.00/10 followed by 86.50. But the dollar could come under further pressu= re if investors were seen to be avoiding the US market. Therefore, a key fa= ctor for EUR/USD this week is corporate sentiment and the direction of US e= quities. Dealers will closely scrutinize capital flow data to the US and Eu= rozone. Worries could send the dollar lower across the board and possibly t= oward 88.80 against the euro in the near term, despite positive economic da= ta from the US. Resistance is seen at 88.00, 88.60 and even 88.80. But if t= he pair was to fail breaking the last resistance zone, it could resume its = downtrend from there. This reflects the view that US equity losses are also= a temporary phenomenon and that a rise in the euro is not a reflection of = its own strength. Tuesday's German Ifo business survey will also be key t= o the euro's near term direction as markets expect a rise to 87.3 in Februa= ry from 86.3. Business confidence probably improved again but has yet to re= ach the pre-September 11 level of 89.3. However, expectations have greatly = improved, as evidenced by last week's surge in the German ZEW sentiment sur= vey to 50.2 from 35.9 in January, which foretells a significant improvement= over the next 6 months. GBP/USD fell to a day's low of 1.4284 as it came = under increasing pressure against both the euro and dollar. GBP/USD fell ha= lf a cent to a day's low of 1.4287, while sterling also fell to a low of 61= .25 pence agaisnt the euro. GBP/USD support seen at at 1.4285, 1.4235, 1.42= 00 and 1.4150. Upside capped at 1.4340, 1.4365 and 1.440. Sterling remains = weak after back-to-back surprise declines in UK retail sales were seen as a= sign that the UK's two-speed economy may be converging finally. With consu= mer spending falling and manufacturing slowly rising, it stands in sharp co= ntrast with the upbeat outlook for the US. GBP also likely to remain under = pressure after PM Blair has stepped up the EMU propaganda machine, which ca= n weigh on the pound because markets anticipate the pound to join at a lowe= r value. Moreover, fears of pension reform that could divert asset away fro= m UK investments, and a possible tax hike to pay for health care reform are= two other factors weighing on sterling. Meanwhile, the yen rose on short = covering today ahead of this week's two key events in Japan. First, the Jap= anese government is expected to finally release its anti-deflation package = on Wednesday, along with proposals for dealing with non-performing loan dis= posal. Dealers will look for any new easing measures taken by the Japanese = to tackle deflation. But Should Japanese officials think that the coming gl= obal recovery will allow them to muddle through and not enact tough love re= forms, then the market is likely to be disappointed and sell the yen. Then= , the Bank of Japan meets on Thursday to set monetary policy, and dealers t= hink the central bank may increase its purchases of Japanese government bon= ds to 1 trillion from 800 million. However, this is not expected to satisfy= the FX market, which has come to view liquidity as more or less a mute poi= nt amid rampant deflation and lack of demand. Therefore, the yen is in a lo= se-lose situation because if the BoJ takes no action the yen is likely to w= eaken on disappointment. Or, if the BoJ does inject more liquidity, the yen= could, as in the past, weaken in reaction. Upside capped at 134.50, follow= ed by 134.85 and strong resistance at 135.15. Support holds at 133.20, 133.= 0 and 132.50. Meanwhile, the dollar will continue to trade hesitantly amid= Wall Street whims and Greenspan's key semi-annual testimony to the Congres= s on Wednesday. Markets will look for any hints that the chairman is becomi= ng more bullish on the prospects for the US recovery and whether the Fed ma= y begin to raise interest rates sometime this year. =09[IMAGE] Audio Mkt. = Analysis USD Holds Steady Despite Drop in Stocks Articles & Ideas Of= f Goes the Franc, On Comes Jospin JPY: Japan's Reform Dilemma Artic= les & Ideas Forex Glossary Economic Indicators Forex Guides Link Libr= ary [IMAGE] =09 =09=09[IMAGE][IMAGE] [IMAGE][IMAGE]=09 =09=09 This e-mail is never sent unsolicited. If you wish to unsubscribe f= rom this or any other Forexnews.com newsletters, please click here . Any = opinions expressed by representatives of Forexnews.com or its affiliates as= to the commentary, market information, and future direction of prices of s= pecific currencies reflect the views of the individual analyst, and do not = necessarily represent the views of Forexnews.com or its affiliates in any w= ay. In no event shall Forexnews.com or its affiliates have any liability fo= r any losses incurred in connection with any decision made, action or inact= ion taken by any party in reliance upon the information provided in this ma= terial; or in any delays, inaccuracies, errors in, or omissions of informat= ion. =09