Message-ID: <11877084.1075861045221.JavaMail.evans@thyme> Date: Tue, 5 Mar 2002 04:54:21 -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: @ENRON X-To: Shackleton, Sara 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] JPY Tests USD Bulls, EuroF= x Steady After Upbeat Data March 5, 7:00 AM: EUR/$..0.8675 $/JPY..131.89 G= BP/$..1.4203 $/CHF..1.6995 JPY Tests USD Bulls, EuroFx Steady After Upbeat= Data by Jes Black At 8:40:00 AM US Redbook (exp n/f, prev 0.6%) At 9:00:0= 0 AM US BTM/UBSW sales (exp n/f, prev -0.4%) At 10:00:00 AM US Feb ISM non-= mfg survey (form. NAPM) (exp 51, prev 49.6) The yen challenged overnight 2= -week highs of 131.80 against the dollar and pushed to a day's high of 114.= 40 against the euro despite upbeat economic data from the US and Eurozone o= ver the past week. Yen strength is based on hopes and fears and not sound e= conomic fundamentals. But the dollar's recent failure to benefit from stron= g data and Wall Street's surge has left bulls feeling uncertain. Therefore,= currencies continue to trade familiar ranges with trends hard to find. Th= e European majors gave back some of their overnight gains against the dolla= r despite positive services PMI data from the Eurozone and UK. E12 services= index expanded for the second month in a row rising to 51.5 in February fr= om 51.0. New business also rose to 50.6 from 49.7, indicating the first ris= e in new business since the summer. The news raises hopes that a Eurozone e= conomic recovery is around the corner. The data showed France and Italy lea= ding the recovery, while the rate of decline eased in Germany. More impor= tantly, unemployment improved to 8.4% in January despite how weak output ha= s been. Coupled with stronger than expected E12 PMI data and a further gain= in consumer confidence the ECB is expected to keeps rates unchanged at 3.2= 5% on Thursday. In fact, financial markets are already pricing in a quarter= percentage point ECB rate rise by June. The German DIW institute head also= doesn't expect more ECB rate cuts in this cycle, saying the next move is u= p. Bank of France head Jean-Claude Trichet reiterated on Tuesday his view = that a strong euro was "in the best interests" of the euro zone economy. Bu= t traders were hard to convince as they pushed EUR/USD to a day's low of 86= .73 after twice failing to maintain above 87 cents. The pair gave up overni= ght gains and could fall back towards last week's 3-week low of 86.25 if it= is unable to break resistance at 87.15. Traders are not encouraged by Euro= zone prospects and sentiment is again turning bearish enough to target a mo= ve through 86.30/15 on its way to its 6-month low of 85.63. But technical i= ndicators are mixed. Support is seen at 86.60, 86.30, 86.15, and 85.60. Res= istance is viewed at 87.10, and 87.85. GBP/USD also fell to a day's low of= 1.4204 after twice failing to break strong resistance seen at 1.4240. Resi= stance is eyed at 1.4240, 1.4280 and 1.430. Support holds at 1.4180 and 1.4= 130. A break of 1.4110 would put 1.4045 under pressure and be seen as a bea= rish signal. Sterling was also unable to leverage good services PMI data in= to gains after Britain's dominant services sector expanded for the second m= onth running in February to 51.5 from 51.0. The figures also support the co= nsensus estimate that the BoE, which also meets on Thursday, will keep rate= s unchanged this week at a 38-year low of 4.0 percent. Moreover, indicatio= ns from today's PMI data show that both input prices and prices charged in = the UK and E12 have fallen over the last month, which will reassure central= bank members that monetary tightening to contain inflation is not a pressi= ng concern. Meanwhile, JPY resumed its recent rise and targeted the key 13= 1.85 mark against the dollar today for the second time this week. Its diffi= cult to ascribe a good fundamental reason from the strength. But traders at= tribute it to Monday's 5.9% rise in the Nikkei to a 6-month high of 11,450,= repatriation fears and hopes that Japan may finally tackle its non-perform= ing loan problems. Recent measures to support Japanese asset prices also gi= ves Japan's capital-weak banks a needed (if artificial or temporary) boost = ahead of mark to market fiscal year end on March 31. Were USD/JPY to break= key support at 132.00/131.80 it would have a bearish implication for the p= air and would open up a downside target of 130.45. But the recent sell off = may have bottomed again at the 131.80 mark, where stop loss orders are bein= g protected. Upside capped at 133.0, 133.50 and 133.70, 134.00/10, 134.70/8= 5 and strong resistance at 135.15. Support holds at 132.20 and 131.80. Des= pite USD losses across the board on Monday, US stocks soared on hope that t= he US economy is on the verge of recovery based on recent affirmative econo= mic data. The Dow skyrocketed 2.1% or 217 points to 10586 and NASDAQ rose 3= .1% or 56 points to 1859. Therefore, dealers will look to see what today's = services PMI data says in US. Both European figures showed modest gains aft= er breaking back above the 50 mark into expansion in January. US non-manufa= cturing ISM survey is expected to break above the key 50-level to 51.0 in F= ebruary from the previous 49.6, thereby indicating growth in the services s= ector. While this is a positive confirmation for the improvement in the US = economy, reaction in FX markets is likely to be muted ahead of Thursday's m= onetary policy speech by Greenspan and Friday's key US labor market report.= =09[IMAGE] Audio Mkt. Analysis JPY Drags Down USD to 2 1/2 Week Low = Articles & Ideas Euro: The Lonely Tender JPY: Koizumi Fails To Deliver = Articles & Ideas Forex Glossary Economic Indicators Forex Guides = Link Library [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. 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