Daily Analysis Thread

[ForexPros]

Today�s US Dollar Trading

� USD mixed, US data no help
� Stops drive a lot of early trade
� S/R broken but the majors bounce back

Overnight Preview
� USD likely to trade two-way
� Consolidation ahead of the news later in the week likely

Looking Ahead to Tuesday
All times EASTERN (-5 GMT)
� 9:00am USD Fed Chairman Bernanke Speaks
� 10:00am USD Factory Orders m/m 0.0%
� Tentative USD Domestic Vehicle Sales 10.8M

Summary
The USD ends the day mixed after starting overnight mixed against the majors. Despite slightly better-than-expected US data this morning the USD sold off to make lows against most pairs by about the London Fix; after that the Greenback settled into two-way trade that gradually ground higher to end the day mid-range. Stops were the larger part of the day�s action traders say with only the GBP dropping into technical support. For the most part the USD fell back to test recent S/R and more technical two-way trade is expected overnight as fundamental news is light ahead of NFP later this week. Cable fell back from a high print overnight at 1.9776 to post a New York low at 1.9595 before rebounding; holding above the 1.9630 area is a good clue the rate will rotate higher the next 24 hours or so. Volumes were only moderate traders say so it is possible that GBP will remain two-way within existing S/R. EURO fell through support on stop driven trade for a low print at 1.5485 before rallying out of the hole to post a high print at 1.5591 before offers capped the rally. Again, traders say volumes were only moderate and the rate is expected to remain range bound. Both pairs appear to be tracking one another so aggressive traders can look to buy dips and you can expect a signal the next 24 hours or so. USD/JPY fell through several layers of support as well dropping to a low print on stops at 104.01 before bouncing to the 104.50 area. Stops under the 104.50 area were absorbed easily but offers were finally able to push the rate into the 104.20 area and once cleared the rate rebounded on profit-taking. Swissy had an identical day but fell through the 1.0380/90 area considered to be the monthly pivot point; closing under the 1.0350 area the rate looks for more weakness near-term but as in other rates analysts expect two-way trade. Looking ahead the next 24 hours I would expect the USD to consolidate within existing ranges. Look for more opportunity to short the USD on strength near-term.

GBP/USD Daily
Resistance 3: 1.9780
Resistance 2: 1.9720
Resistance 1: 1.9680
Latest New York: 1.9660
Support 1: 1.9600/1.9590
Support 2: 1.9550
Support 3: 1.9520

Comments
Long wick suggests bid pressure for two-way action coming, rumors of official demand lift rate off the lows around the 1.9590 area; failure to put on weight above the 1.9700 area suggests rate will consolidate lower. Lots of potential for day traders the next 24-48 hours as the rate is likely to stay range bound ahead of US data later in the week. Fundamentals still suggest a lower GBP and the failure to extend gains above the 1.9850 area so soon after Friday�s reversal argue for a continued downside after a bounce is possible. Continue to expect a lot of sympathy trade with EURO; the cross-spreaders are having a field day with the Sterling crosses and I think the GBP may track EURO near-term. Need a close below the 100 bar MA to build argument for the short but volatility is higher so expect a rally back to test the breakdown, expect continued whipsaw.
Not a lot to do but wait in my view.
Data due Tuesday: All times EASTERN (-5 GMT)
Tentative GBP Halifax House Price Index m/m -1.1%
4:30am GBP Construction PMI 45.7
7:01pm GBP Consumer Confidence Index 68

USD/JPY Daily

Resistance 3: 105.50
Resistance 2: 105.20
Resistance 1: 104.80
Latest New York: 104.49
Support 1: 104.00
Support 2: 103.70/80
Support 3: 103.40/50

Comments
Rate broke into stops under the 104.20 area but no one was home and the rate recovered after the move. Not likely to see further weakness without an attempt at a rally in my view. Monday�s close leaves a doubt to the potential; expect lot�s of two-way action and the rate is likely to cover a lot of the same ground twice the next 24-48 hours. Stops the other side of 105.80 are in size suggesting that speculators got heavily short last week. This week�s data may be largely ignored until NFP out later in the week.

Look for stops to be raised up by the longs this week and some should be resting under today�s lows around the 104.50 area (likely cleared with today�s drop)
Data due Tuesday: All times EASTERN (-5 GMT)
9:00am JPY BOJ Governor Shirakawa Speaks
7:50pm JPY Capital Spending q/q -9.6%

Analysis by: Forexpros.com written by Jason Alan Jankovsky
Disclaimer:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

[ForexPros]

Today�s US Dollar Trading
� USD reverses from highs overnight, ends mixed
� US data neutral to favorable but no follow-through
� Volumes lighter as traders are confused

Overnight Preview
� Traders expect two-way action with the majors to consolidate
� Likely the USD will remain technical until NFP on Friday
Looking Ahead to Thursday

All times EASTERN (-5 GMT)
� 8:30am USD Unemployment Claims 374K
� 10:35am USD Natural Gas Storage
� 12:00pm USD Philadelphia Fed President Plosser Speaks

Summary
Despite neutral-to-better US data today the USD was unable to extend gains from yesterday and ended the day mixed. Better against GBP, the Greenback pushed Cable into early lows at 1.9424 after clearing stops under the 1.9500 handle in Europe. Traders note that cross-spreaders are on the offer and most of the action was related to non-USD pairs. Although the rate was on the defense most of the day traders report nice bids from sovereign names supported on every dip. Offers are said to be building around the 1.5480 area with stops layered above suggesting that late shorts are playing a very tight stop. EURO fell back a bit but was supported as well on dips; low prints at 1.5418 were never challenged and as oil prices rose and fell so did EURO making for whippy trade. Traders note that Russian names were active matching other calls for sovereign interest on the lows. Analysts remind that the 1.5500 area likely to offer at least one pullback if the rate rallies but stops are just above suggesting late shorts are running tight risk control similar to GBP. USD/JPY had a tight two-way range today but still inside yesterday; finishing back above the 105.00 handle at around the 105.15 area; large bids said to be under the rate around the 104.40 area but lows at 104.52 left those unchallenged. Traders note that volumes were light on the day and that down action appears to have some teeth to it but caution that the stops are still higher; roughly the 105.50/60 area. Could have some whipsaw also overnight. Swissy was firm around the 1.0420 area to end the day after bids were uncovered in the 1.0350/60 area this morning. Positive ADP data lifted the USD off of the lows but offers above the 1.0440 area contained the rally. Traders expect overhead resistance to hold but the rally could extend to 1.0520 area near-term. In my view, the USD went nowhere today and with good news out of the way it is likely that NFP will disappoint. How the market trades the next 24 hours is important to the set-up; I am looking for quiet two-way action to end in USD weakness by this time tomorrow. I don�t think the Greenback has what it takes to lift into new weekly highs when facing down a serious piece of data later this week. Should be a quiet overnight session;

GBP/USD Daily
Resistance 3: 1.9720
Resistance 2: 1.9680
Resistance 1: 1.9630/40
Latest New York: 1.9545
Support 1: 1.9520/30
Support 2: 1.9500
Support 3: 1.9480

Comments
After all was said and done today, the GBP traded mostly sideways on light volumes. Dips were bought by large names traders say. Stops drive rate into the lows but bids and rumors of sovereign buys hold rate at the 1.9450/60 area on light volume to start New York. Trading in sympathy with EURO continues and EURO strength likely to spillover eventually into cable. Stopped out of longs overnight; OK to look at the long side again as support may be forming at current levels; might want to wait 24 hours. Lots of potential for day traders the next 24-48 hours as the rate is likely to stay range bound ahead of US data later in the week. Continue to expect a lot of sympathy trade with EURO; the cross-spreaders are having a field day with the Sterling crosses and I think the GBP may track EURO near-term. Expect continued whipsaw around US news this morning. Bernanke comments a total head-fake in my view.
Data due Thursday: All times EASTERN (-5 GMT)
Tentative GBP Halifax House Price Index m/m -1.1%
Tentative GBP MPC Rate Statement
7:00am GBP Official Bank Rate

USD/JPY Daily

Resistance 3: 105.80
Resistance 2: 105.50/60
Resistance 1: 105.30
Latest New York: 105.27
Support 1: 104.40/50
Support 2: 104.00/10
Support 3: 103.70/80

Comments
Rate is stuck in-range; no follow-through either way but longs getting nervous I think. Expect more selling on overnight strength. Hold shorts�nothing to do but wait as the bulls run for the exits. Model accounts on the bid last night a good sign the rate will fall back. Expect lots of two-way action and the rate is likely to cover a lot of the same ground twice the next 24-48 hours. This week�s data may be largely ignored until NFP out later in the week. Longs likely rolling stops up underneath close-in so expect volatility later today.
Data due Thursday: All times EASTERN (-5 GMT)

Analysis by: Forexpros.com written by Jason Alan Jankovsky

Disclaimer:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

[ForexPros]

[B][U]Today�s US Dollar Trading[/U][/B]
� USD two-way is moderate trade
� Majors correct into support but hold firm
� US data surprises to the upside

[B]Overnight Preview[/B]
� Look for the USD to trade two-way
� Not a lot of news until later in the week

[B]Looking Ahead to Tuesday[/B]
All times EASTERN (-5 GMT)
� 8:30am USD Trade Balance -58.2B
� 10:00am USD IBD/TIPP Economic Optimism
[B][/B]
[B][U]Summary[/U][/B]
The Greenback is mixed to end New York after a whippy start to the week. Initially weaker in Asia, the minor holiday along the Pacific Rim slowed action until the start of European trade. The USD gained a bit on the EURO and GBP as UK data was mildly supportive for Cable but was ignored as the New York session got underway. The release of US housing data was above expectations and the USD rallied into the middle of the day; however technical levels held firm and the USD�s recovery from the thrashing it got Friday is likely to be brief. Both ECB Trichet and US Tres. Sec. Paulson were speaking today and hinted that the USD strength was welcome but Trichet was less than enthusiastic about the USD�s potential to recover. He said that he welcomed the advances seen in recent weeks but warned that the oil shock seen on both continents was the result of �poor policies�; Paulson also said that intervention by the US Fed �can�t be ruled out�. In my view I think that Mr. Paulson takes the trading community for fools because anyone with any experience at all knows that it is impossible for intervention to accomplish anything of lasting value; the trading community only sees that as an opportunity to add to winning positions. I suppose if the Treasury and the Fed wish to repeat the mistakes of the BOE then we should look to that as an opportunity. For the record, the GBP reversed from the highs at 1.9804 to close around the 1.9720 area leaving a strong selling wick on the day. EURO had more than a 200 point range today and closed lower but did hold the 50 bar MA in moderate trade. Most desks are expecting the EURO to again rally this week as the fundamentals are surely supporting a higher EURO. USD/JPY rallied but traders feel this is more in line with Yen weakness rather than USD strength. The rate held the weekly highs from last week and for all intents and purposes the rate is topping at the weekly highs as volumes were light on the move. Look to sell this USD strength the next 24-48 hours. No rush as the majors have a lot of give and take likely to develop near-term; US data is thin this week and may not be a factor.
[B][/B]
[B][U]EURO/USD Daily
[/U][/B]Resistance 3: 1.5900
Resistance 2: 1.5880
Resistance 1: 1.5850
Latest New York: 1.5721
Support 1: 1.5710/20
Support 2: 1.5680
Support 3: 1.5650/60

[B]Comments[/B]
Disappointing day for the bulls; close under the 50 bar argues for return to bearish action. Stops and offers noted above the 1.5790/1.5800 areas, COT data showed an increase in EURO shorts through last week and those are likely cleared now; fall back today tests the 50 bar MA; close below likely signals a further decline. Trichet hints at a rate hike for July but today�s rhetoric a bit softer; I think that is only to stem a rapid rise too quickly. Overhead resistance appears firmer on the approach to the 1.5800/20 area which is a likely to offer upside resistance through the rest of the week. Now that the break is out of the way we will look for a place to re-enter our longs.

Data due Tuesday: All times EASTERN (-5 GMT)
2:45am EUR French Industrial Production m/m -0.8%
4:00am EUR Italian Industrial Production m/m -0.2%

[B][U]USD/CHF Daily
[/U][/B]Resistance 3: 1.0380
Resistance 2: 1.0350
Resistance 1: 1.0300/10
Latest New York: 1.0291
Support 1: 1.0150
Support 2: 1.0110/20
Support 3: 1.00080

[B]Comments[/B]
Rate rallies to test the 50 bar MA where the stops were on Friday�fails to back a break higher stick suggesting the rate will rotate lower the next 24 hours. No doubt some bids are profit-taking from the shorts but that won�t last in my view. Any rally likely to attract selling so be ready for a short; sell signal today suggests rate is ready to rotate lower again. In my view, the rate needs to be sold on any strength. Look for a sell signal again overnight. Light volumes suggest whipsaw coming.

[ForexPros]

Today�s US Dollar Trading
� USD continues to advance but volumes slow
� Traders report thin order books
� US data today benign

Overnight Preview
� Look for two-way trade
� USD to consolidate

Looking Ahead
All times EASTERN (-5 GMT)
� 10:35am USD Crude Oil Inventories -4.8M
� 11:30am USD FOMC Member Kohn Speaks
� 12:15pm USD Fed Governor Kroszner Speaks
� 2:00pm USD Beige Book

Summary
The USD continued to advance against the majors today as benign Balance of Trade data was ignored in favor of rhetoric from major sources. Overnight comments by US Fed chair Bernanke suggested that the US fed was ready to raise rates sooner-rather-than-later to combat inflation; traders took this to mean the Fed could move as early as the next month or two and bought USD across the board. Tripping stops placed close-in; all the major pairs dropped dramatically against the Greenback putting the USD into strong S/R to end the day. Profit taking by the shorts also helped propel the USD higher and for the most part the USD is holding strong gains on light volume. In my view, it is the volume issue that makes this rally a concern for me. Light volume rallies are almost always followed by a retracement and I think USD bulls need to be ready for a break lower. Supporting the USD also today were lower crude prices but as I have said before, I don�t see the overwhelming economic impact of oil at $128/BBL saving the economy as opposed to $136/BBL; the fact is energy costs TWICE what it did a year ago so where is the benefit to the USD? For the record, GBP fell back assisted by cross-spreaders from the highs at 1.9760 with low prints under previous support at 1.9517. The important issue with Cable in my view is that despite the grind lower in EURO all day posting low after low; GBP did not fall in tandem suggesting that perhaps the GBP is on near-term lows. EURO reversed from highs at 1.5655 to post lows late in the day at 1.5439 before drawing bids. Forex Traders say the EURO saw bids all the way down and volumes were light. In my view, the EURO is bottoming again from the exact area it started from last week. Aggressive traders can buy EURO if not holding longs already. Swissy rallied along with USD/JPY and both pairs posted near-term highs; USD/JPY at 107.46 and Swissy at 1.0441. Both rates struggled to the highs and volumes were thin; traders say order boards were empty into the highs. Offers in both pairs said to extend a reasonable 50 pips higher and the upside may be exhausting itself. A surprise move by the Bank of Canada reversed the Loonie against the Greenback; falling back under the 1.0200 handle for a low print at 1.0194 before staging a slight recovery. Traders note the USD/CAD will have a hard time extending gains after the news. Look for the USD to remain two-way and quiet overnight. Technical trade may develop in which case a drop in the USD is more likely.

EURO/USD Daily

Resistance 3: 1.5900
Resistance 2: 1.5880
Resistance 1: 1.5850
Latest New York: 1.5460
Support 1: 1.5480/90
Support 2: 1.5440/50
Support 3: 1.5390/5400

Comments
Rate grinds lower all day as order boards thin out and sovereign bids are absorbed. Support under the 1.5440 area appears solid but no bounce on thin volumes. OK to hold longs for a return to the 1.5800 area this week. Stops and bids noted at the 1.5580 area. Trichet hints at a rate hike for July but today�s rhetoric a bit softer; I think that is only to stem a rapid rise too quickly. Overhead resistance appears firmer on the approach to the 1.5800/20 area which is a likely to offer upside resistance through the rest of the week. Now that the break is out of the way we will re-enter our longs. Look for inside range day closing higher tomorrow.

Data due Wednesday: All times EASTERN (-5 GMT)
2:45am EUR French CPI m/m 0.4%

USD/JPY Daily
Resistance 3: 108.20
Resistance 2: 107.80
Resistance 1: 107.40/50
Latest New York: 107.30
Support 1: 106.20/30
Support 2: 105.80
Support 3: 105.40/50

Comments
Rate grinds higher after the London fix, traders report thin conditions. Technical traders note a fib defense area around today�s highs and never forget that the fundamentals haven�t changed one bit in the last 72 hours; USD likely not this strong but more benefiting from Yen weakness. Still showing signs of a top, offers by exporters all the way to the overnight high traders say suggesting that the strength may be short-lived. Stops likely rolled up under the 106.20 area again for today so if a break happens�look for a drop to new monthly lows fairly quickly. Aggressive traders can sell anytime over the 107.00 area but I want to wait through the Tokyo open tonight.
Data due Wednesday: All times EASTERN (-5 GMT)
NONE

Analysis by: Forexpros.com written by Jason Alan Jankovsky
Disclaimer:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

[ForexPros]

Today�s US Dollar Trading
� USD fails to hold gains
� Stops run early
� Two-way action suggests offers building

Overnight Preview
� Look for consolidation with a downside bias
� USD likely to open lower in New York tomorrow

Looking Ahead to Thursday
All times EASTERN (-5 GMT)
� 8:30am USD Core Retail Sales m/m 0.7%
� 8:30am USD Retail Sales m/m 0.5%
� 8:30am USD Import Price Index m/m 2.5%
� 8:30am USD Unemployment Claims 370K
� 10:00am USD Business Inventories m/m 0.3%
� 10:35am USD Natural Gas Storage
� 11:30am USD Fed Chairman Bernanke Speaks

Summary
The USD was unable to hold gains earned yesterday as the Majors rallied across the board leaving the USD bulls with losses today. Although the rally by the GBP was muted compared to the rally seen in EURO traders remind that the week is not over yet and that the US data due the next 48 hours could easily be seen as unfriendly to the Greenback. GBP was unable to test highs made in Europe overnight as spillover strength from EURO supported the rate despite offers layered above the 1.9620 area. High prints at 1.9670 were offered by cross-spreaders and the rate held the 1.9620 area into the close. EURO made a new high in New York at 1.5588 before offers capped the move but the rate continued to firm all day and managed a close at the 1.5565 area suggesting that the EURO has some teeth to the bounce near-term. Volatility has been large in both pairs and forex traders expect that to continue. Both pairs may cover a lot of the same ground twice the next few days but at least in EUR I expect a firm close back over the 1.5600 handle to close the week. The ECB is set to hike rates and will continue to do so for the next few quarters and I don�t see the EURO falling back any more than a reasonable correction�which may have already happened with the trade action seen since February this year. USD/JPY is lower and failed to hold the 107.00 handle on the day; low prints at 106.55 were bought as rumors of official demand were seen but the rate closes lower on the day and more losses are coming in my view. Swissy is also under pressure and low prints in New York at 1.0307 are decidedly below stops seen at the 1.0350 area earlier in the day. Trader�s note that in all pairs light stops were elected as the USD lost ground but the larger stops are still working; look for more USD pressure near-term as technical trading dominates ahead of US data tomorrow and Friday. Look for book-squaring tonight ahead of Retail Sales data; not normally a market-mover but with unemployment on the hook tomorrow there is a chance of aggressive action by the USD bears if they like the data.

USD/JPY Daily
Resistance 3: 108.20
Resistance 2: 107.80
Resistance 1: 107.40/50
Latest New York: 107.02
Support 1: 106.40/50
Support 2: 106.20/30
Support 3: 105.80

Comments
Rate grinds higher after breaking into support today; traders note model and momentum accounts buying USD Monday and Tuesday�good sign a top is forming. Traders report thinner conditions. Technical traders note a fib defense area around today�s highs and never forget that the fundamentals haven�t changed one bit in the last 72 hours; USD likely not this strong but more benefiting from Yen weakness. Still showing signs of a top, offers by exporters all the way to the overnight high at 107.77 traders say suggesting that the strength may be short-lived. Stops likely rolled up under the 106.80 area again for today so if a break happens�look for a drop to new monthly lows fairly quickly. Aggressive traders can sell anytime over the 107.00 area. Close over the 107.00 area a caution to the bears.
Data due Thursday: All times EASTERN (-5 GMT)
Tentative JPY Overnight Call Rate

USD/CHF Daily
Resistance 3: 1.0520
Resistance 2: 1.0480
Resistance 1: 1.0440/50
Latest New York: 1.0321
Support 1: 1.0300/10
Support 2: 1.0250/60
Support 3: 1.0220

Comments
Rate continues to rotate up to and fail at the 100 bar MA area; the 1.0480 area looks to be poised to offer resistance again. Today�s close under the 1.0350 area suggests further losses to end the week. Buyers appear to be technical traders and expect some momentum accounts on the bid soon. No doubt some bids are profit-taking from the shorts but that won�t last in my view. Any rally likely to attract selling so be ready for a short; if we get a sell signal on the day today likely to enter a short. In my view, the rate needs to be sold on any strength. Look for a sell signal again overnight. Light volumes suggest whipsaw coming.
Data due Thursday: All times EASTERN (-5 GMT)
6:00am CHF SNB Board Member Jordan Speaks

Analysis by: Forexpros.com written by Jason Alan Jankovsky
Disclaimer:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

[ForexPros]

Today�s US Dollar Trading
� USD retreats from Friday�s gain
� US data benign�points to more losses
� Speculation grows that USD will fall

Overnight Preview
� Look for the USD to consolidate
� Expect two-way action

Looking Ahead to Tuesday
All times EASTERN (-5 GMT)
� 8:30am USD Housing Starts
� 8:30am USD PPI m/m
� 8:30am USD Building Permits
� 8:30am USD Core PPI m/m
� 8:30am USD Current Account
� 9:15am USD Capacity Utilization Rate

Summary
The USD starts this week lower against most pairs but still two-sided as Monday draws to a close. In New York the USD saw the worst levels of the day so far as surging oil prices slammed equities and rallied the EURO. Oil prices slid off as volatility whipsawed energy prices taking the USD higher against the Swiss Franc and firming up against Yen but still unable to better the highs seen on Friday across the board. US data was benign as most reports came in lower than expected; TICS showed a decent cover but still not the whole picture as EURO remained firm near the 1.5500 handle all day. EURO rallied for a high print at 1.5520 early ahead of the London fix and keeping GBP up with it. Cable high during NY trade at 1.9690 with stops above the 1.9650 area driving the rate to the highs. Profit taking by longs dropped the rate back to the 1.9620/30 area into the close but EURO�s firmness into the end of the day suggest that both rates are poised for an additional leg higher overnight or during US trade tomorrow. If US data in the morning is again benign for the Greenback traders expect another leg lower for the USD during the day. USD/JPY remained above the 108.00 handle but under the 200 day MA making the technical picture better for the bears who argue a top is forming; USD/CHF also topping as the 1.0480 area again offers resistance all day to the USD. Highs at the 1.0523 level went unchallenged all day in NY suggesting that the Swissy is ready to drop back to below the 100 bar MA to start the week. Traders note that in all pairs the technical picture appears in focus near-term and expect dips to be bought and rallies to be sold. The big question is where are the large stops? Traders look for tomorrows� data to push the Greenback in both directions so expect some whipsaw as the majors look for near-term direction.

EURO/USD Daily

Resistance 3: 1.5580
Resistance 2: 1.5550/60
Resistance 1: 1.5520
Latest New York: 1.5480
Support 1: 1.5350
Support 2: 1.5300/10
Support 3: 1.5280

Comments
Another strong buy signal this morning suggests the rate will bottom; expect higher action all week as late shorts get squeezed. Today�s rally likely to encounter selling pressure up to the 1.5550 and 1.5580 areas; looking to ADD to open longs if you took some on Friday�if not; looking to open a long on any weakness. Rate finds support as more rumors of Swiss private bank bids at current levels; should rate put in a long tail today a buy might be on the table for Tuesday. Stops and bids noted at the 1.5420 area in size; more said to be resting at the 1.5500. Overhead resistance appears firm at 1.5550 now that the 1.5340 area of option defense fell.

Data due Tuesday: All times EASTERN (-5 GMT)
4:00am EUR Italian Trade Balance
5:00am EUR German ZEW Economic Sentiment
5:00am EUR ZEW Economic Sentiment
5:00am EUR Trade Balance

USD/CHF Daily
Resistance 3: 1.0580
Resistance 2: 1.0550/60
Resistance 1: 1.0520
Latest New York: 1.0443
Support 1: 1.0400
Support 2: 1.0380
Support 3: 1.0320/30

Comments
Rate likely to draw additional selling pressure on a drop back under the 100 bar MA today; look for sell signals the past three sessions to hold. Look for a short early this week; aggressive traders who sold USD/CHF on the close Friday can look to add soon. Overhead resistance at the 1.0600 handle but rate may be getting boost from other USD strength in other pairs. Rate continues to rotate up to and fail at the 100 bar MA area; the 1.0480 area looks to be poised to offer resistance again today but a sell off to end the day is needed. Buyers appear to be technical traders and expect some momentum accounts on the bid soon. No doubt some bids are profit-taking from the shorts but that won�t last in my view. Any rally likely to attract selling again so be ready for a short next week. In my view, the rate needs to be sold on any strength.
Data due Tuesday: All times EASTERN (-5 GMT)
3:15am CHF Industrial Production q/q

Analysis by: Forexpros.com written by Jason Alan Jankovsky

Disclaimer:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

[ForexPros]

Today�s US Dollar Trading
� Overseas data USD negative
� USD rally falters in US trade
� Volumes lighter

Overnight Preview
� USD likely to remain technical in nature
� Look for more downside pressure

Looking Ahead to Wednesday
All times EASTERN (-5 GMT)
� 10:35am USD Crude Oil Inventories

Summary
The USD whipsawed today initially falling in Asia and then rallying in Europe before falling back again during New York trade. Not a lot of news supported the trade action today; overseas news was mostly supportive to the EURO and the GBP but both of them were under selling pressure early. US data this morning was USD neutral to negative but the Greenback held gains initially. Although the USD fell back to suffer minor losses against Swissy, Loonie and JPY�the USD held good gains against the GBP as UK data and rhetoric caused a stop-driven panic ahead of US trade today. Falling all the way down to a 1.9468 low print after a high at 1.9700 today�s GBP trading can only be described as �whipsaw�. The GBP recovered to trade 1.9580 into the close in New York making a mess of most balance sheets. Traders note that stops were run in both directions suggesting that the rate was long into the highs and then short into the lows. Leaving a long bid-tail like today�s action argues for more upside follow-on buying tomorrow. With a light economic calendar it is likely that trade will be technical the next 24 hours but with an upside bias. EURO rallied to the 1.5553 area before falling back with Cable but rallied into the end of the day again to close above the 1.5510 area suggesting more upside to come tomorrow. In my view, the majors head-faked everybody today and more losses for the USD are coming. Today�s data was seen as mildly neutral to slightly bearish and I think that most traders were temporarily focused on UK and Eurozone data this morning; once the PPI and Current Account data sink in and are compared with the poor housing data I think a further decline in the Greenback will be warranted. Look for the USD to sell off the next 24 hours or so. If holding longs in the majors get ready to add to open positions as more gains are coming I think.

GBP/USD Daily

Resistance 3: 1.9700
Resistance 2: 1.9650
Resistance 1: 1.9600/10
Latest New York: 1.9568
Support 1: 1.9500/10
Support 2: 1.9450/60
Support 3: 1.9420

Comments
Rate bounces off support at the 1.9470 area; leaves a long bid wick suggesting the downside is a head-fake. Comments from BOE reverse the rate as traders panic on the sell-side. If long, need to be patient and wait for the panic to subside and the rally to resume. Rate finds stops layered under the 1.9600 area all the way down into active selling under the 1.9500 handle; if this selling is absorbed then the rate will recover fairly quickly I think. Rumors of UK inflation concerns keeps the rate buoyed above 2008 lows. Likely cross-spreaders on the move. A bounce is likely and aggressive traders can ADD if not already long. Spillover weakness from EURO still likely as would be strength. Continue to expect a lot of cross-trading; the cross-spreaders are having a field day with the Sterling crosses and I think that will continue through this week and into the next.
Data due Wednesday: All times EASTERN (-5 GMT)
4:30am GBP MPC Meeting Minutes
6:00am GBP CBI Industrial Trends Orders
2:30pm GBP BOE Governor King Speaks

USD/JPY Daily

Resistance 3: 109.20
Resistance 2: 108.80
Resistance 1: 108.50/60
Latest New York: 107.95
Support 1: 107.60/70
Support 2: 107.20/30
Support 3: 106.80

Comments
Exponential reversal signal overnight, need to sell the rate. Close under the 108.00 area significant; look to add if rate can hit the stops in the 107.40/50 area near-term. Some topping seen; expect volatility. Today�s close under the 200 bar MA likely to draw some sympathy selling but watch volumes. Bids appear solid but so do offers; exporters on the offer all the way to the top overnight and active the past several days. Option defense noted at 107.80 through 108.20; but that has fallen this morning. Technical traders note fib defense area around today�s highs and never forget that the fundamentals haven�t changed one bit in the last week or so. USD likely not this strong but more benefiting from Yen weakness. Can the rate top at the 108.50 area? Stops likely rolled up under the 107.40 area again for today so if a break happens�look for a drop to the 106.00 handle fairly quickly. Bulls likely to take gains by end of day if rumored stops above the 108.60/70 area are left untouched.

Data due Wednesday: All times EASTERN (-5 GMT)
7:50pm JPY All Industries Activity Index m/m

Analysis by: Forexpros.com written by Jason Alan Jankovsky
Disclaimer:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

[ForexPros]

Today�s US Dollar Trading
� USD two-way overnight
� Weakens in NY trade
� All eyes on US data tomorrow

Overnight Preview
� Look for the USD to consolidate with a lower tone

Looking Ahead to Thursday
All times EASTERN (-5 GMT)
� 8:30am USD Unemployment Claims
� 10:00am USD Philadelphia Fed Manufacturing Index
� 10:00am USD Leading Index m/m
� 10:35am USD Natural Gas Storage
� 2:30pm USD FOMC Member Kohn Speaks

Summary
The USD is lower to end the day in New York after a two-way overnight session that saw the USD on the best levels of the day in early US trade. Overseas data was benign and after the London fix the Greenback began to slide off as traders squared positions ahead of US economic news tomorrow. Technical trading was the rule today and most action was on the sell side of USD as the majors were able to hold above important S/R during the day. Cable rallied over the 1.9600 handle briefly as stops were elected in both directions from overnight trade. Finding support again at the 1.9470 area stops from late shorts again were placed in range and the rate rallied on moderate volume. Making an inverted hammer on the daily charts traders expect the GBP to rally again on Thursday after US data; ahead of there expect a lot of two-way action and potential whipsaw although the 1.9470 area appears solid as support. EURO rallied all day and challenged overnight Asian highs above the 1.5520 handle late in the day but high prints at 1.5539 remained on the day; more two-way action is expected tonight ahead of US data in the morning. USD/JPY fell through light stops to make lows on the day at the 107.70 area before rebounding; traders note that stops under the 107.50 area remain untouched for now and are building into the end of the week. Without a bit of upside help the rate appears ready to drop into reported support under the 107.00 handle. Swissy is also under pressure to end the day dropping to a low print at 1.0355 before a slight bounce; traders note that the rate is under the important 100 bar MA again into the close. Despite a rather lackluster session with little news to focus on the USD is weaker on technical factors again. I would look for the Greenback to continue to consolidate with a weaker tone overnight. Look for the majors to advance again during the day tomorrow as US news is not likely to be friendly in the morning.

EURO/USD Daily

Resistance 3: 1.5600
Resistance 2: 1.5580
Resistance 1: 1.5550/60
Latest New York: 1.5526
Support 1: 1.5440/50
Support 2: 1.5380
Support 3: 1.5350

Comments
Near the highs around the 1.5550 area suggests more follow-on buying. Rate remains trapped inside range; pressured along with GBP but holds support at 1.5470 area. Looking for a long on next push into highs�then a pullback. If rate can clear the 1.5550 area and then fall to support around the 1.5500 area I think we are on the buy side at that point. Expect higher action all week as late shorts get squeezed. Rate finds support as more rumors of Russian and Mid-East buyers; Swiss private bank on the offer overnight. Should rate put in a long tail today a buy might be on the table. Stops and bids noted at the 1.5420 area in size; more said to be resting at the 1.5500 area; all in range. Overhead resistance appears firm at 1.5550 with stops above.

Data due Thursday: All times EASTERN (-5 GMT)
4:00am EUR Italian Unemployment Rate

USD/JPY Daily

Resistance 3: 109.20
Resistance 2: 108.80
Resistance 1: 108.50/60
Latest New York: 107.88
Support 1: 107.60/70
Support 2: 107.20/30
Support 3: 106.80

Comments
Exponential reversal signal overnight, need to sell the rate. If short�let it work. Close under the 108.00 area significant today; look to add if rate can hit the stops in the 107.40/50 area near-term. Some topping seen; expect volatility. Today�s close under the 200 bar MA likely to draw some sympathy selling but watch volumes. Bids appear solid but so do offers; exporters on the offer all the way to the top overnight and active the past several days. Technical traders note fib defense area around today�s highs and never forget that the fundamentals haven�t changed one bit in the last week or so. USD likely not this strong but more benefiting from Yen weakness. Stops likely rolled up under the 107.40 area again for today so if a break happens�look for a drop to the 106.00 handle fairly quickly. Bulls likely to take gains by end of day again if rumored stops above the 108.60/70 area are left untouched.

Data due Thursday: All times EASTERN (-5 GMT)
Tentative JPY BOJ Governor Shirakawa Speaks

Analysis by: Forexpros.com written by Jason Alan Jankovsky
Disclaimer:bu
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

[ForexPros]

Overnight Asia/Europe
� USD firms a bit
� Technical trade and stops drive GBP and EURO
� Volumes moderate

Today�s Economic Reports
All times EASTERN (-5 GMT)
� None for the day
Expect technical trade for the most part

Looking Ahead
All times EASTERN (-5 GMT)
� 9:00am USD National HPI Composite-20
� 10:00am USD Consumer Confidence
� 10:00am USD House Price Index m/m
� 10:00am USD Richmond Fed Index

Summary
The USD is two-way overnight but starts the New York session on the offensive. Still range-bound against Swissy and Yen, the Greenback has recovered some of the losses from late last week. After starting firm in Asia and weakening on exporter supply, the USD/JPY has advanced back to the 107.80 level for a high print in New York at 108.89 but traders see a lot of offers layered up to the technical resistance area of 108.00/10. Stops are said to be over that figure but the overall sentiment is for lower USD/JPY for the week. Swissy is back in the sell zone around the 1.0440/50 area; aggressive traders can look to sell the pair anywhere over the 1.0440 area in my view. The rate is technically weak trading higher on lighter volume and stops above the 1.0410 area so a pullback and long selling wick would be ideal today in that pair. Cable has dropped dramatically tracking EURO lower as both rates suffer from cross-spreading and poor German IFO data. Cable fell from the high print at 1.9760 overnight for a low print in early New York at 1.9699 and remains under pressure. Traders note that the lower-than-expected German IFO data disappointed EURO dropping the rate back into close-in stops at the 1.5550 area for a low print in late Europe at 1.5498 where Asian sovereign demand was seen. Aggressive traders can look to buy EURO under the 1.5520/30 area today and expect a buy signal during New York action today. Across the board traders note that volumes are modest and action is technical. All the pairs are trading inside established ranges from last week so nothing really significant is happening just yet. In my view, you can expect a further decline in GBP today and through the week while the USD/JPY and USD/CHF will likely remain range-bound and under pressure. Expect a slow-grind in those pairs. EURO is likely to firm up and advance this week as the technical�s look positive and the market needs to price in a 25 BP rate hike coming in two weeks from the ECB. Look for the USD to remain two-way but weaker today.

GBP/USD Daily

Resistance 3: 1.9750/60
Resistance 2: 1.9720
Resistance 1: 1.9680
Latest New York: 1.9612
Support 1: 1.9580
Support 2: 1.9550
Support 3: 1.9520

Comments
Toolbox provides another strong sell signal overnight, target is short is around the 1.9480/19500 area through the week. Surging oil prices helped EURO last week but a softer start is likely spilling over into GBP. Spillover weakness from EURO still likely all week. Continue to expect a lot of cross-trading. Aggressive forex traders can add to their open shorts anywhere under the 1.9650 area I think; if not short sell a rally into the 1.9650/80 area if you get it today.
Data due Tuesday: All times EASTERN (-5 GMT)
4:30am GBP BBA Mortgage Approvals

EURO/USD

Resistance 3: 1.5680
Resistance 2: 1.5650/60
Resistance 1: 1.5620/30
Latest New York: 1.5523
Support 1: 1.5550
Support 2: 1.5500
Support 3: 1.5470

Comments
Rate drops back under the 1.5550 area to start the week; should get a buy signal the next day or so. The 50 bar MA offering resistance; close over the 50 bar likely to draw more buying early in the week but for now there is pressure coming on in that area. Close Friday above the 1.5550 area failed to attract more buying, drop into close in stops near the 1.5550 area from late longs; a dip is likely a buying opportunity. Bids will likely be in the 1.5500/20 area or so. Expect higher action next week as late shorts get squeezed. If long, OK to hold over the weekend. Buy the next dip to add to positions.

Data due Tuesday: All times EASTERN (-5 GMT)
Tentative EUR German Import Price Index
2:45am EUR French Consumer Spending

Analysis by: Forexpros.com written by Jason Alan Jankovsky

Disclaimer:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

[ForexPros]

Today�s US Dollar Trading
� USD holds gains but flows light
� S/R holds as expected
� Speculation that the Fed will not move rates capping the USD

Overnight Preview
� Consolidation likely
� Two-way action with a downside bias

Looking Ahead to Tuesday
All times EASTERN (-5 GMT)
� 9:00am USD National HPI Composite-20
� 10:00am USD Consumer Confidence
� 10:00am USD House Price Index m/m
� 10:00am USD Richmond Fed Index

Summary
The USD is firmer but falling off the highs for the day as the volumes are drying up into the New York close. Traders note that across the board the USD remained inside established ranges to start the week and due to the two-way nature of today�s action most traders expect more consolidation. Volumes got really light after the London fix most desks say and it is likely that traders don�t want to force positions ahead of the two-day FOMC meeting which starts tomorrow. Analysts are almost unanimous that the Fed will not move rates on Wednesday but are divided as to the significance of the statement. Most are expecting Bernanke to �talk tough� but no one expects the Fed to do anything for the next two or three FOMC meetings. In response to poor European news overnight the EURO and GBP both fell back to near-term support but rallied off those lows after the London fix this morning and are now at their highs for the New York session into the close. EURO has regained the 1.5520 area after dropping into the 1.5460/70 area on light volume this morning. Traders expect EURO to remain two-way through the week with technical trading likely; most analysts say the rate is �fairly� pricing in a 25 BP hike by the ECB on Jul 3rd. In my view, the FOMC is the key to the trade this week as no move at all will work favorably for the EURO. USD/JPY continued to hold gains but was unable to attract any serious buying at the high prints of 108.07; stops rumored to be above the 108.10 area are out of range today. Traders expect the rate to weaken near-term as the technical picture favors at least a test of the 107.00 handle this week. In my view, the rate is due for a sharp sell-off as all these longs must be getting nervous now that the rate has failed at the quarterly highs several times. Look for the USD/JPY to rotate lower overnight and test the south end of the range the next 24 hours. Swissy is also failing at key resistance, the 1.0480 area. Offers from late longs appear to be active as no stops were reported above the 1.0410/20 area only active buying. Now that those longs are under threat expect a pullback into the 1.03 handle soon. Should be a quiet night ahead of US data tomorrow; don�t expect any surprises.

USD/JPY Daily

Resistance 3: 108.80
Resistance 2: 108.50
Resistance 1: 108.00/10
Latest New York: 107.81
Support 1: 107.20/30
Support 2: 107.00
Support 3: 106.80

Comments
Rate grinding sideways to higher overnight; volumes lighter and upside resistance is firm at 108.00 area. Failure to close above the 108.00 handle Monday a good sign rate is ready to break back to the lows looking for stops under the 107.10/107.00 area. Exponential reversal signal still valid, rate is two-way but weaker each day. If short�let it work. If today�s rally fails under the 108.00 handle look for a drop into stops under the 107.00/10 area the next 24 hours. Look to add if rate can hit the stops in the 107.00 area near-term. Some topping seen; expect volatility. Bids appear solid but so do offers; exporters likely on the offer all the way to the highs overnight and active the past several days. USD likely not this strong but more benefiting from Yen weakness. Stops likely rolled up under the 107.00 area for today so if a break happens�look for a drop to the 106.00 handle fairly quickly.
Data due Tuesday: All times EASTERN (-5 GMT)
7:50pm JPY Trade Balance
7:50pm JPY CSPI

USD/CHF Daily

Resistance 3: 1.0520
Resistance 2: 1.0480
Resistance 1: 1.0450/60
Latest New York: 1.0457
Support 1: 1.0320/30
Support 2: 1.0300
Support 3: 1.0270/80

Comments
Rate rallies back to resistance, fails at 1.0480 area as expected. Rate stuck in a range but still looking to support/resistance hovering around the 100 bar MA. Overhead resistance now at the 1.0480 area. Rate continues to rotate up to and fail at the 100 bar MA area; a sell off to end the day today would be ideal to set-up for further losses during the week. Buyers appear to be technical traders and expect some momentum accounts on the bid soon. No doubt some bids are profit-taking from the shorts but that won�t last in my view. In my view, the rate needs to be sold on any strength. Hourly sell signals also suggest that the rate is ready to rotate lower again. Look for two-way action overnight into Tuesday.
Data due Tuesday: All times EASTERN (-5 GMT)
4:00am CHF Consumption Indicator

Analysis by: Forexpros.com written by Jason Alan Jankovsky
Disclaimer:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

[ForexPros]

Today�s US Dollar Trading
� USD two-way all day
� Starts on the offensive�ends on the defensive
� GBP and EURO at technical resistance.

Overnight Preview
� Look for a quiet evening ahead of FOMC

Looking Ahead
All times EASTERN (-5 GMT)
� 8:30am USD Core Durable Goods Orders m/m
� 8:30am USD Durable Goods Orders m/m
� 10:00am USD New Home Sales
� 10:30am USD Crude Oil Inventories
� 2:15pm USD FOMC Statement
� 2:15pm USD Federal Funds Rate

Summary
Despite a better start overnight the USD was unable to hold significant gains today after the release of disappointing US data gave traders a reason to sell the Greenback. Although the early volatility was important enough to make new highs or lows on the day for the USD it wasn�t enough to put most pairs into new ranges; traders note that volumes were moderate and both sides seemed to find a reason to take a stand. Trading has been muted the past 24 hours with most desks reporting that concern over the FOMC rate announcement due out tomorrow is keeping larger players quiet; although larger names have been seen at the highs or lows today. Cable initially firmed following EURO but took at hit when the UK mortgage numbers overnight were less than inspiring. Falling to a low print at 1.9622 in early New York the GBP reversed course and rallied to a high print at 1.9726 before offers capped the move today. US data lifted both the GBP and the EURO but neither pair could hold gains as both pairs were at technical resistance during the day. EURO stalled just above the 50 bar MA for a high print at 1.5623 before falling back and leaving a long selling wick on the day. I suggested earlier in the day to liquidate your long EURO position and if you are holding longs still be ready to exit those positions overnight. I don� think the EURO has what it takes to hold above the 50 bar MA near-term. USD/JPY broke down to post a daily low at 107.36 before rallying all the way back to the 108.00 handle; then dropping mid-range on the close. At no time did the rate ever make the impression it intended to break out to a new high or a new low. Traders note that the rate is simply stuck in an existing range and may be there through the FOMC announcement tomorrow. Swissy also broke to new lows at the 1.0348 number before bouncing off the 50 bar and 100 bar MA�s on the daily chart. In my view, the USD/CHF is firming a bit too much to be short. I would look to take the trade off the next 24 hours if the rate continues to gain above the 1.0400 handle near-term; such as overnight. In my opinion, the USD will cover a lot of the same ground tonight and into the FOMC meeting tomorrow. Look for a rally as a selling opportunity.

EURO/USD Daily
Resistance 3: 1.5680
Resistance 2: 1.5650/60
Resistance 1: 1.5620
Latest New York: 1.5567
Support 1: 1.5500/1.5490
Support 2: 1.5470
Support 3: 1.5450

Comments
Rate unable to hold gains after surprise rally into the 1.5620 area; long selling wick companion to the bid wick from Monday. Rate likely stuck in tighter range for now. Russians buying EURO a good sign but watch for model accounts on the bid the next few days. The 50 bar MA offering resistance; close over the 50 bar likely to draw more buying early in the week but for now there is pressure coming on in that area. Bids will likely be in the 1.5500/20 area or so. Expect higher action this week as late shorts get squeezed. If long, better to get flat or reverse.

Data due Wednesday: All times EASTERN (-5 GMT)
4:00am EUR ECB President Trichet Speaks
4:00am EUR Italian Retail Sales m/m

USD/JPY Daily

Resistance 3: 108.80
Resistance 2: 108.50
Resistance 1: 108.20
Latest New York: 107.76
Support 1: 107.20/30
Support 2: 107.00
Support 3: 106.80

Comments
Rate whipsaws around current S/R; unable to gain traction above or below recent boundaries. Volumes lighter and upside resistance is firm at 108.00 area or a shade higher. Failure to close above the 108.00 handle Monday a good sign rate is ready to break back to the lows looking for stops under the 107.10/107.00 area. Exponential reversal signal still valid, rate is two-way but weaker each day. If short�let it work. If today�s rally fails under the 108.00 handle look for a drop into stops under the 107.00/10 area the next 24 hours. Look to add if rate can hit the stops in the 107.00 area near-term. Some topping seen; expect volatility. USD likely not this strong but more benefiting from Yen weakness. Stops likely rolled up under the 107.00 area for today so if a break happens�look for a drop to the 106.00 handle fairly quickly.

Data due Wednesday: All times EASTERN (-5 GMT)
NONE

Analysis by: Forexpros.com written by Jason Alan Jankovsky

Disclaimer:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

[ForexPros]

[B][U]Today�s US Dollar Trading[/U][/B]
� USD whipsaws after early sideways start
� US data unfriendly to the Greenback
� As expected, FOMC holds rates firm

[B]Overnight Preview[/B]
� USD likely to continue to weaken
� EURO above resistance

[B]Looking Ahead[/B]
All times EASTERN (-5 GMT)
� 8:30am USD Final GDP q/q
� 8:30am USD Unemployment Claims
� 8:30am USD Final GDP Price Index q/q
� 10:00am USD Existing Home Sales
� 10:35am USD Natural Gas Storage
[B][/B]
[B][U]Summary[/U][/B]
As expected the FOMC held interest rates steady and left the discount window on hold too. The statement was full of the usual �Strong Dollar� rhetoric but after the initial brief USD rally into expected S/R the Greenback reversed hard and fell to new lows on the day across the board. Stops were seen in all pairs but active selling of USD was noted by several shops as the USD made highs around the FOMC announcement. Traders were not surprised at the strength of the reversal or the speed and many expressed concern that the USD will get ahead of itself on a decline before the ECB has a chance to raise rates next week. GBP rallied for a high print at 1.9771 after the announcement; traders note that stops were elected at 1.9740/50 area after the first push to there was repelled during the day. In other words, shorts sold ahead of the news and placed their stops close-in expecting a drop which never happened. EURO plowed through near-term resistance and is no officially rallying; stops placed around the 1.5630 area were triggered as layered supply above the 1.5600 area was absorbed after the news. EURO now has no top ahead of the 1.5800/20 area some traders say and a sustained rally may be in the works for tomorrow and Friday. Should the EURO clear the 1.5800 area or beyond by the end of the week that would make this month an engulfing month on the charts�a very bullish scenario. USD/JPY failed to inspire trade either way for most of the day preferring to hover at the 108.00 handle until the Fed news; a brief rally to 108.43 high print was sold aggressively and the rate reversed into low prints at 107.65 within minutes. The rate is unable to break out of the 108.40-107.00 range that has plagued this pair for over a week. When it finally goes one way or the other it could be a spectacular move. USD/CHF also reversed hard making lows on the day at 1.0340; traders expect more. Almost lost in the day�s action was earlier US data, Durables were flat and housing was lower; traders expect that more unfriendly news will be seen for tomorrow as well. In my view, nothing to do but buy dips in EURO and add to open shorts in other pairs.
[B][/B]
[B][U]EURO/USD Daily[/U][/B]

Resistance 3: 1.5800
Resistance 2: 1.5750/60
Resistance 1: 1.5720
Latest New York: 1.5674
Support 1: 1.5550/60
Support 2: 1.5500
Support 3: 1.5450

[B]Comments[/B]
Rate blasts through resistance and makes highs for the week. Better EMU news helps keep the rate firm. US news likely to create volatility. Russians buying EURO again overnight a good sign but watch for model accounts on the bid the next few days. The 50 bar MA offering resistance; close over the 50 bar likely to draw more buying tomorrow. Bids will likely be in the 1.5580 area or so on any meaningful correction. Expect higher action this week as late shorts get squeezed.

Data due Thursday: All times EASTERN (-5 GMT)
2:00am EUR German Import Price Index m/m
4:00am EUR M3 Money Supply y/y
[B][/B]
[B][U]USD/CHF Daily
[/U][/B]
Resistance 3: 1.0520
Resistance 2: 1.0500
Resistance 1: 1.0470/80
Latest New York: 1.0350
Support 1: 1.0320/30
Support 2: 1.0300
Support 3: 1.0270/80

[B]Comments[/B]
Tight range and low volumes overnight; rate likely to whipsaw today so be ready for volatility. Looking to add to position if rate can clear under the 1.0300/10 area. Rate stuck in a range but still looking to support/resistance hovering around the 100 bar MA. Overhead resistance now at the 1.0480 area. Rate continues to rotate around the 100 bar MA area; a sell off to end the day today would be ideal to set-up for further losses during the week. Buyers appear to be technical traders and expect some momentum accounts on the bid soon. No doubt some bids are profit-taking from the shorts but that won�t last in my view. In my view, the rate needs to be sold on any strength. Hourly sell signals also suggest that the rate is ready to rotate lower again.
Data due Thursday: All times EASTERN (-5 GMT)

NONE

[ForexPros]

Overnight Asia/Europe
� USD starts firm, weakens into Europe
� Stops triggered on the way down
� Traders report good volume

Today�s Economic Reports
All times EASTERN (-5 GMT)
� 9:45am USD Chicago PMI

Looking Ahead to Tuesday
All times EASTERN (-5 GMT)
� 10:00am USD ISM Manufacturing Index
� 10:00am USD ISM Manufacturing Prices
� 10:00am USD Construction Spending m/m
� Tentative USD Domestic Vehicle Sales
Expect ISM to remain weak.

Summary
The USD started Asia on the defensive as most of the major pairs rallied again to new near-term highs against the Greenback; Cable and EURO finding previous resistance a bit tougher to break and stalling at previous monthly highs. Cable high print at 1.9968 roughly in line with previous highs in the same area from late April and reversing to go negative on the day shortly after the European open. Disappointing UK mortgage approvals put the pressure on Sterling again and the rate made lows just ahead of the US open at 1.9894. EURO made a high print in Asia at 1.5837 before reversing along with GBP; low prints in early New York at 1.5745 before light bids supported the rate off the lows. Both GBP and EURO are tracking each other as cross-spreaders continue to work the Yen side of the crosses; speculation is high that the Yen will continue to weaken against most pairs but today appears to be a profit taking day as the reversals are in all Yen crosses.USD/JPY was pressured into new monthly lows completing a reasonable fib retracement target for a low print in Europe at 104.98 before bids were seen and a short squeeze resulted. The rate has recovered to the 105.60 area in light trade as New York gets underway. Stops reported at the 105.50 area on the way down and again on the way up suggesting late traders are getting whipsawed. USD/CHF dropped in tandem with other USD weakness falling to a low print at 1.0130 before a short squeeze took the rate back over the 1.0200 handle; traders note that across the board in all pairs stops were elected from what appears to be the late USD long. That being said, the probability of additional volatility and likely recovery now that the stops have been run is higher; aggressive traders can look to short EURO above the 1.5770 area and take gains on the Short USD/JPY and USD/CHF positions around current pricing if still in from the weekend. Although the trend is lower for the USD I expect a lot of potential volatility this week and the next thing is to re-short on strength if we get it. Look for the USD to rally into previous resistance across the board and we can re-short it there. Today�s PMI data likely to inspire a bout of volatility.

EURO/USD Daily

Resistance 3: 1.5900
Resistance 2: 1.5880
Resistance 1: 1.5830/40
Latest New York: 1.5768
Support 1: 1.5720
Support 2: 1.5680
Support 3: 1.5650

Comments
Rate not supported by higher Oil today suggesting a near-term top. Stops noted under the previous lows layered under 1.5700 traders say. Closes near the 1.5800 handle from last week, more upside likely but a pullback is needed. Asian sovereign selling seen overnight. US news today likely to create volatility so be ready for whipsaw or a reversal. Should cable break�EURO could go with it. Watch for model accounts on the bid today; those guys love to buy highs. The 50 bar MA likely to offer support should the rate fall back; close over the 50 bar likely to draw more buying to end the week. Bids will likely be in the 1.5580 area or so on any meaningful correction. COT data show a flip to EURO longs; could be a clue for a top.

Data due Tuesday: All times EASTERN (-5 GMT)
3:55am EUR German Unemployment Change
5:00am EUR Unemployment Rate

USD/JPY Daily
Resistance 3: 107.80
Resistance 2: 107.20/30
Resistance 1: 106.50
Latest New York: 105.56
Support 1: 10500/104.90
Support 2: 104.50
Support 3: 104.20

Comments
Rate continues on follow-on weakness, strong bids noted suggesting a whipsaw bounce is coming. Today�s dip under the 105.00 handle lacked conviction and a potential rally may develop early; sell that rally early next week if we get it. In the meantime, OK to liquidate shorts and wait. Exponential reversal signal still valid, rate is two-way but weaker each day. Stops in the 105.80 area cleared overnight; traders note stops were both ways. Cot data show a flip to Yen longs suggesting a bottom is in.
Data due Tuesday: All times EASTERN (-5 GMT)
7:50pm JPY Monetary Base y/y

Analysis by: Forexpros.com written by Jason Alan Jankovsky

Disclaimer:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

[ForexPros]

Today�s US Dollar Trading
� USD loses ground but attempts a recovery
� Stops run
� Volumes moderate

Overnight Preview
� Two-way action likely

Looking Ahead to Tuesday
All times EASTERN (-5 GMT)
� 10:00am USD ISM Manufacturing Index
� 10:00am USD ISM Manufacturing Prices
� 10:00am USD Construction Spending m/m
� Tentative USD Domestic Vehicle Sales
Expect ISM to remain weak.

Summary
The USD is two-way and whippy today after a losing start to the day. Across the board the USD made monthly lows to end the quarter no doubt creating a lot of risk-aversion liquidation ahead of US data and the holiday-shortened trade week. GBP has upside resistance at 1.9960 area challenged more than once on several rallies but each time the market backed off to trade lower. Into the London fix rumors of buy-needs kept the rate firm but once the fix was gone traders sold the rate lower and the GBP made lows for the day at 1.9878; rate continued to whipsaw short-term accounts as the GBP rallied off the low to trade above the 1.9940 area briefly again. For the most part the EURO had a similar day but dropping Oil prices helped to keep the pressure on more-so than GBP. EURO had a high print at 1.5837 but once the highs were in during European trade the EURO settled back to trade lower all day. Traders note that in both pairs volumes were moderate and with a lower close likely all offers. USD/JPY remained on the defensive most of the morning but staged a modest recovery after the London fix as well coming close to the overnight highs with a New York high at 106.25 areas. Traders say the rate is likely to remain two-way as Asian sovereigns have an appetite for USD on the dips while exporters are on the offer during any strength. The rate held the 105.00 handle on the morning break suggesting that a rotation higher might be good for a test of the breakdown area around the 107.50 area near-term; should that be the case there is a lot of volatility there. Swissy weakened as well but held lows at 1.0130 which were never challenged in New York trade. USD/CHF likely to weaken more but the rate wants to rotate high and was the only major pair higher on the day today. Loonie rallied as well and cleared the 1.0200 handle briefly suggesting a lot of two-way action is coming. The rate settled back after scoring a high at 1.0215 in two way action. Traders note that volume were good in all pairs and more two-way action is due across the board. In my view, the Greenback is set to rotate higher ahead of Non-Farm payrolls later in the week. Although whipsaw is likely as well, I think your best strategy is to sell rallies and wait for the upside correction in USD to fail.

EURO/USD Daily
Resistance 3: 1.5900
Resistance 2: 1.5880
Resistance 1: 1.5830/40
Latest New York: 1.5742
Support 1: 1.5720
Support 2: 1.5680
Support 3: 1.5650

Comments
Rate not supported by higher Oil today suggesting a near-term top. Closing lower suggests some selling pressure is developing. Stops noted under the previous lows layered under 1.5700 traders say. Closes near the 1.5800 handle from last week, more upside likely but a pullback is needed. Asian sovereign selling seen overnight. US news today likely to create volatility so be ready for whipsaw or a reversal. Should cable break�EURO could go with it. Watch for model accounts on the bid today; those guys love to buy highs. The 50 bar MA likely to offer support should the rate fall back; bids will likely be in the 1.5580 area or so on any meaningful correction. COT data show a flip to EURO longs; could be a clue for a top.

Data due Tuesday: All times EASTERN (-5 GMT)
3:55am EUR German Unemployment Change
5:00am EUR Unemployment Rate

USD/JPY Daily
Resistance 3: 107.80
Resistance 2: 107.20/30
Resistance 1: 106.50
Latest New York: 106.23
Support 1: 10500/104.90
Support 2: 104.50
Support 3: 104.20

Comments
Rate continues on follow-on weakness, strong bids noted suggesting a whipsaw bounce is coming. Close back over the 106.00 area suggests a rally soon. Today�s dip under the 105.00 handle lacked conviction and a potential rally may develop early; sell that rally if we get it. In the meantime, OK to liquidate shorts and wait. Exponential reversal signal still valid, rate is two-way but weaker each day. Stops in the 105.80 area cleared overnight; traders note stops were both ways. COT data show a flip to Yen longs suggesting a bottom is in.
Data due Tuesday: All times EASTERN (-5 GMT)
7:50pm JPY Monetary Base y/y

Analysis by: Forexpros.com written by Jason Alan Jankovsky

Disclaimer:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

[ForexPros]

Today�s US Dollar Trading
� The Greenback whipsaws, ends weaker
� EURO holds 1.5800 handle with conviction
� Volumes lighter

Overnight Preview
� Traders look for a quiet evening ahead of Thursday
� Expect volatility

Looking Ahead to Thursday
All times EASTERN (-5 GMT)
� 8:30am USD Nonfarm Employment Change
� 8:30am USD Unemployment Rate
� 8:30am USD Average Hourly Earnings m/m
� 8:30am USD Unemployment Claims
� 10:00am USD ISM Non-Manufacturing Composite

Summary
The USD whipsawed both bulls and bears today after a surprise ADP report ignites a round of USD selling. Most of the major pairs rallied to test near-term resistance and the Greenback went on the defensive shortly after the news this morning after building a nice base of firmness overnight. Dropping through several support levels the USD found stops and active selling to drive it into previous weekly lows; traders note that volumes were not impressive and suggest that the break may be a bear trap ahead of US and ECB data tomorrow. GBP failed to rally to new highs but tracked EURO higher after the news. Stops above the 1.9920/30 area triggered after shorts took control under the 1.9900 handle briefly this morning. Highs at 1.9977 went unchallenged despite the rally in EURO. Scoring new weekly highs and a new 30 day high at 1.5889 EURO remained bid all day after stops above the 1.5850 area were triggered. Traders note that volumes were lighter but can�t argue with the near-term strength. Poor US data is expected tomorrow and a 25 BP rate hike by the ECB is keeping the rate bid. Many traders are sidelined ahead of tomorrow�s news due to the fact that the rate is at the levels it should be at for the hike and poor US news. In my view, the EURO is setting up for a correction lower and today�s strength is possibly a bull trap. Tomorrow will be hard to play as the markets close early in the US after a slew of important fundamentals. USD/JPY looked strong this morning then broke back sharply as the USD was sold across the board; traders note that the rate is a full handle lower than the highs at the open. In my view the USD is having a knee-jerk reaction and USD/JPY is likely to recover into tomorrow�s action. Aggressive traders can look to buy the rate on weakness under the 105.80 area near-term. Swissy and Loonie both broke back to go neutral on the day after scoring important 24 hour highs. In my view, the USD is whipsawing both sides and neither the bulls nor the bears have the upper hand. Expect more volatility on Thursday as the ECB meeting/press conference add fuel to the US data due out about the same time. With an early close it will be a volatile day so if not positioned with a lead it is OK to stay flat and come back next week.

EURO/USD Daily

Resistance 3: 1.5950
Resistance 2: 1.5920/30
Resistance 1: 1.5900
Latest New York: 1.5875
Support 1: 1.5770
Support 2: 1.5720
Support 3: 1.5680

Comments
Rate rallies hard after ADP surprises, stops elected above the 1.5860 area. Rate whipsaws lower then higher and makes highs on light volume ahead of US news tomorrow. Highs were sold aggressively by Asian sovereigns traders say but rate is firm. Lots of stops building under the 1.5770 area and a break lower is likely on whipsaw Thursday. Stops noted under the previous lows layered under 1.5700 traders say. US news tomorrow likely to create volatility so be ready for whipsaw or a reversal. Should cable break�EURO could go with it. The 50 bar MA likely to offer support should the rate fall back; bids will likely be in the 1.5580 area or so on any meaningful correction. Equities weaker also no help.

Data due Thursday: All times EASTERN (-5 GMT)
4:00am EUR Services PMI §
5:00am EUR Retail Sales m/m
7:45am EUR Minimum Bid Rate
8:30am EUR ECB Press Conference

USD/JPY Daily

Resistance 3: 107.40/50
Resistance 2: 107.20
Resistance 1: 106.80
Latest New York: 105.97
Support 1: 105.70/80
Support 2: 105.50
Support 3: 105.20

Comments
Rate gives back overnight gains on whipsaw, likely to trade both sides of unchanged tonight ahead of US data tomorrow. Rate firms up on large cross-spreading traders say; look for a push on stops around the 107.00 handle. OK to place a resting order at the 107.50 area to sell the rate. Bids noted at 105.70/80 area suggesting a firm bottom is in near-term. Sell a rally if we get it. Exponential reversal signal still valid, rate is two-way but a correction is coming and should be a low-volume affair. Offers layered to 107.50 some desks report so upside may be labored above the 106.50 area; stops above 106.80 or so. Expect more two-way action overnight ahead of US data.

Data due Thursday: All times EASTERN (-5 GMT)

NONE

Analysis by: Forexpros.com written by Jason Alan Jankovsky

Disclaimer:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

[ForexPros]

Today�s US Dollar Trading
� USD reverses higher after a lower open in New York
� Traders note stops and liquidation off the lows
� USD/JPY flirts with close above the 200 bar MA

Overnight Preview
� Look for the USD to consolidate
� Two-way action ahead of minor news tomorrow

Looking Ahead to Wednesday
All times EASTERN (-5 GMT)
� 10:35am USD Crude Oil Inventories
� 2:00pm USD Beige Book
Continuing the slow start for US data this week.

Summary
After a low-volume sell-off this morning to trade at the worst levels of the day the USD rallied back hard to run stops and squeeze shorts all day into the close. Traders note that volumes increased dramatically once the reversal began to gain momentum and across the board the USD rallied through resistance to close at some critical numbers for the USD bulls. Cable tracked EURO lower as expected but found large stops resting in the 1.9930/40 area and traded to a low print at 1.9894 briefly before holding above the 1.9900 handle but well below the trigger point for the stops. EURO had a similar day eventually finding stops under the previous week�s low at 1.5780 area for a low print at 1.5756 before bouncing; the rate unable to regain the 1.5800 handle into the close making for a potential reversal today. Traders note that with the increase in volume on the rally for the Greenback it is possible that the USD has put in the low for the week; the majors have all completed minor reversal patterns suggesting the same. Although there was a bit of profit taking by the longs this afternoon the USD/JPY held onto solid gains above the 107.00 handle and closes around the 200 bar MA; stops were elected above the 107.20 are and high prints at 107.45 before a drop in volume and a fall back to the 107.10/20 area. Traders note that the rate has closed at the 200 bar MA which has ignited volatility in recent trade and more upside is expected to be sold with some traders suggesting offers ready at the 107.80 area. Today�s rally and test of the 107.50 area suggests that the USD has more upside ahead before a fall back making the ranges the Greenback has a bit wider and subject to more whipsaw. In my view, the USD has shown enough strength to look for another add point on the current open trades. I think aggressive traders can look to sell the GBP and the EURO around the closing levels today and look to buy more USD/JPY tomorrow after the Asian session. If oil continues to weaken early in Asia I think the USD/JPY could advance into reported stops above the 107.80 area and possibly challenge the 108.00 handle for the day; an excellent short potential I think. For tonight I look for two-way consolidation with a better bias for the USD.

GBP/USD Daily
Resistance 3: 2.0120
Resistance 2: 2.0100
Resistance 1: 2.0080
Latest New York: 1.9905
Support 1: 1.9880
Support 2: 1.9840/50
Support 3: 1.9820

Comments
Sell more into the close, rate drops after low-volume rally stalls. Stops at 2.0050 area, volumes very light. Traders report interest on the sell side from large names and Asian Sovereigns. Rate tracking EURO as expected but unable to break out either way yet. Hold shorts; look to add on further weakness below the 200 bar MA. ADD today for aggressive traders. Bids under the 1.9950 area likely cleared, stops likely now after upper stops cleared. Offers from large names traders say; if 1.9950 fails on the close it could be a big drop. Traders expect GBP to track EURO through this week. Continue to expect a lot of cross-trading.
Data due Wednesday: All times EASTERN (-5 GMT)
4:30am GBP MPC Meeting Minutes
4:30am GBP BBA Mortgage Approvals
6:00am GBP CBI Industrial Trends Orders

EURO/USD Daily

Resistance 3: 1.6000
Resistance 2: 1.5980
Resistance 1: 1.5950
Latest New York: 1.5769
Support 1: 1.5750
Support 2: 1.5700
Support 3: 1.5650

Comments
Rate still two-way and extends range to start today; stops above the 1.5900/10 area triggered this morning. Try for highs on very low volume. Aggressive traders can ADD on this rally as volumes are low and this might be a head-fake. Rate closing under the 1.5800 area is another ADD, hold shorts and let it work. Stops under the 1.5800 area likely in size; expect a sharp break and a close under the 1.5800 area. Large names on the offer reported into the highs, look for a top to form. Major support at the 1.5580 area and slightly below. The 50 bar MA likely to offer support should the rate fall back; bids will likely be in the 1.5580 area or so on any meaningful correction; which is a long way away at this point. Exponential reversal still valid.

Data due Wednesday: All times EASTERN (-5 GMT)
2:45am EUR French Consumer Spending m/m
4:00am EUR Italian Retail Sales m/m
5:00am EUR Industrial New Orders m/m

Analysis by: Forexpros.com written by Jason Alan Jankovsky

Disclaimer:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

[ForexPros]

Today�s US Dollar Trading

� USD regains poise after early break
� Oil and equities help the upside
� Volumes moderate

Overnight Preview
� Expect two-way action
� USD to consolidate

Looking Ahead to Thursday
All times EASTERN (-5 GMT)
� 8:30am USD Unemployment Claims
� 10:00am USD Existing Home Sales
� 10:00am USD FOMC Member Geithner Speaks
� 10:35am USD Natural Gas Storage

Summary
After a slide overnight against GBP and EURO the USD rallied back in late US trade to regain some territory after oil continued to slide and equities put on some weight. The Greenback is at better levels against all the majors than the start of US trade and is poised to challenge stops above the market across the board. Today�s US data was benign and more important data is due for tomorrows release and some traders are looking for the USD to make additional highs for the week although today�s rally volumes were not impressive suggesting that the majors are consolidating recent losses before making a more pronounced move the next 24-48 hours. Cable rallied above the 2.0000 handle but as been the custom above the 200 bar MA does not �feel comfortable� holding gains; the GBP fell back to trade the mid-1.9900 area leaving a strong selling wick above the market. Highs at 2.0032 were on very light volumes and largely stop driven before dropping back to make US lows under the 1.9970 area. A close below the 1.9950 area again is needed to drive the longs to the sidelines and that may come on the Tokyo open in my view. EURO fell as oil slid off and making lows for the US session and the forex day as well; some stops cleared as the rate dipped under the 1.5680 area for a low print ahead of the close at 1.5669; volumes were modest most desks report. USD/JPY struggled with offers at the 108.00 area managing a high print at 107.98 but has not retreated more than a few pips suggesting that a try for stops above the 108.00 area may be on the hook for tonight�s action. Aggressive traders can place a resting limit order to liquidate longs at 108.25 looking for a test of offers at the 108.40 area; if you are really aggressive you might try a close and reverse but with US housing data still to come there is potential for the rate to try for the high 108�s the next 24 hours. Minor whipsaw today paved the way for small accounts to get cleared as they have been on the wrong side of the stops near-term. In my view, look for the USD to consolidate with a bit more upside on the books overnight.

GBP/USD Daily
Resistance 3: 2.0080
Resistance 2: 2.0050
Resistance 1: 2.0020/30
Latest New York: 1.9973
Support 1: 1.9880
Support 2: 1.9840/50
Support 3: 1.9820

Comments
Rate rallies back in lighter volume, stopped out of third add. Potential for large range overnight unexpected and likely more head-fake. OK to add again if rate fails from the highs by the end of the day. Stops at 2.0050 area but offers are there too traders say. Traders report interest on the sell side from large names and Asian Sovereigns but they were on the bid from the lows overnight this time. Rate tracking EURO as expected but unable to break out either way yet. Hold shorts; bids under the 1.9950 area likely cleared, stops likely now after upper stops cleared. Offers from large names traders say; if 1.9950 fails on the close today it could be a big drop. Traders expect GBP to track EURO through this week. Continue to expect a lot of cross-trading.
Data due Thursday: All times EASTERN (-5 GMT)
4:30am GBP Retail Sales m/m
1:00pm GBP MPC Member Bean Speaks

EURO/USD Daily
Resistance 3: 1.5900
Resistance 2: 1.5850
Resistance 1: 1.5800/10
Latest New York: 1.5685
Support 1: 1.5650
Support 2: 1.5620/30
Support 3: 1.5580 (MAJOR SUPP)

Comments
Rate still two-way, dragged higher by Cable but offers at 1.5750/60 capped any further daily strength today. Stops above the 1.5820 area out of reach so far today. Hold shorts and let it work. Stops under the 1.5700/1.5680 area likely in size; expect a sharp break and a close under the 1.5700 area if triggered. Large names on the offer reported into the highs, look for a top to form. Major support at the 1.5580 area and slightly below. The 50 bar MA likely to offer support should the rate fall back; bids will likely be in the 1.5580 area or so on any meaningful correction; which is looking better after the break this week. Exponential reversal still valid.
Data due Thursday: All times EASTERN (-5 GMT)
3:30am EUR German Manufacturing PMI
3:30am EUR German Services PMI1
4:00am EUR German Ifo Business Climate Index
4:00am EUR German Ifo Business Expectations Index
4:00am EUR Manufacturing PMI
4:00am EUR Services PMI
4:00am EUR Current Account

Analysis by: Forexpros.com written by Jason Alan Jankovsky

Disclaimer:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

[ForexPros]

[B][U]Today�s US Dollar Trading[/U][/B]
� Unusually quiet, little volume
� Ranges hold for the most part
� No real push either way with any conviction

[B]Overnight Preview[/B]
� Look for more quiet action
� Two-way and technical action to continue

[B]Looking Ahead to Tuesday[/B]
All times EASTERN (-5 GMT)
� 9:00am USD S&P/CS HPI Composite-20 y/y
� 10:00am USD Consumer Confidence Index
[B][/B]
[B][U]Summary[/U][/B]
Despite a mixed opening and solid two-way trade, none of the majors were able to extend gains against the USD today in super-light trading. Cable scored a modest new high from overnight action, as did Yen, but all the major pairs continue inside previous support or resistance with modest interest on both sides remaining after the first day of trading for the week. GBP held gains made in New York reversing off the lows seen in late Europe but still not attracting large size. Most of the action was considered drifting trade with little impetus behind it suggesting the GBP was drifting higher from lack of selling rather than outright buying. Trader�s note that �absolutely nothing� was going on after the London fix. EURO remained stuck inside a very tight 30 point range after the fix which saw some EURO selling but not enough to break the rate back convincingly under the 1.5700 handle. Traders complained of very light volume again as was the case in all the pairs. USD/JPY fell to a new daily low at the 107.33 figure but saw some solid bids emerge to lift the rate off the lows; high prints overnight at a new monthly high of 108.08 remained unchallenged in NY trade and traders expect another test to draw out the offers again tonight. For the most part the USD was the victim/beneficiary of non-USD cross spreading which again saw demand for Yen at the highs. Exporters on the offer will likely be seen tonight. About the only USD pair with any upside follow-through from last week today was USD/CAD. Traders note that high prints at 1.0247 included light stops and possible official buying suggesting the rate will try for the 1.0250/80 area before reversing. In my view, the Loonie is at the top of the range and a drop is coming so aggressive traders can sell USD/CAD anytime over the 1.0250 area near-term. I�ll make it an official set-up in the next 24 hours but I like the sell side over the 1.0250 area. In my view, the USD has had a dismal day of non-event trading. Today�s highs/lows cannot be relied on to offer significant data for the coming few days as the volume were so low and the interest non-existent. Traders appear to be waiting for more news later in the week. Expect a quiet overnight session also.
[B][/B]
[B][U]EURO/USD Daily
[/U][/B]Resistance 3: 1.5840/50
Resistance 2: 1.5800
Resistance 1: 1.5750/60
Latest New York: 1.5749
Support 1: 1.5670/80
Support 2: 1.5620/30
Support 3: 1.5580 (MAJOR SUPP)

[B]Comments[/B]
Early break bought back but whipsaw is on no volume and rate is stuck. Some semi-official selling possible. Stops and short-squeeze by Russian buying this morning; resistance at 1.5750 area holding. SWF�s were selling EURO on the rally last week; need to see them back this week. Close back under the 1.5700 area needed to pressure buying signals or at least postpone them a few days. Lots of two-way action under the 1.5700 handle. Rate continues to track Cable and vice-versa. Stops above the 1.5820 area possibly in range today; stops under the 1.5620/30 area likely in size and enough to test 1.5580 major support. Hold shorts and let it work. Large names on the offer reported into the highs, look for a top to form. Major support at the 1.5580 area and slightly below. The 50 bar MA likely to offer support should the rate fall back but still looking for a test under the 1.5600 area soon.

Data due Tuesday: All times EASTERN (-5 GMT)
All Day EUR German Prelim CPI m/m
[B][/B]
[B][U]USD/JPY Daily[/U][/B]
Resistance 3: 108.80
Resistance 2: 108.40/50
Resistance 1: 108.00/10
Latest New York: 107.48
Support 1: 107.20/30
Support 2: 106.80
Support 3: 106.50

[B]Comments
[/B]Early dip bought back, rate holds ranges despite an early attempt through the 108.00/10 resistance area. Volumes not that high suggesting more two-way action and bids will support. Rate grinding into offers and a rally may come overnight Monday. Equities continue to drag on the pair but support appears sold on the dip to 106.50 area. Rate is ready to test the size of offers at the 108.00 area and beyond in my view. More stops beyond above 108.50 in large size traders say. Rate likely to attempt more gains if oil drops and equities rally. Exponential reversal signal still valid, expect more two-way action and a test of the highs. Look to cover longs on a rally over the 108.25 area.
Data due Tuesday: All times EASTERN (-5 GMT)
7:50pm JPY Prelim Industrial Production m/m

[B]Analysis by:[/B] Forexpros.com- written by Jason Alan Jankovsky

[B]Disclaimer:[/B]
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

[ForexPros]

Today�s US Dollar Trading
� USD rallies hard after US news
� Stops drive a lot of trade
� Volumes larger

Overnight Preview
� Order boards wiped clean so expect consolidation
� Whipsaw likely around US data in the morning

Looking Ahead to Wednesday
All times EASTERN (-5 GMT)
� 8:15am USD ADP Nonfarm Employment Change
� 10:35am USD Crude Oil Inventories
ADP likely to be the big news for the day.

Summary
After a quiet and slow start overnight the USD rallied hard after the release of better-than-expected Consumer Confidence data to post the best levels of the month against most pairs. Although not a closely watched indicator, today�s Consumer data was enough to rally US equities which started the general climb by the USD until stops above the market were elected in size as had been rumored. Perhaps making for a self-fulfilling prophecy, the majors fell back through waves of stops were hit as traders bailed on long positions once news lows for the week were traded. Across the board the USD rallied and held firm after the London fix and into the close with strong volumes available to mark the USD higher. GBP fell through the 1.9840/50 area early in the day and pressured offers resting around the 1.9800 area until the stops were triggered taking the rate to a low print at 1.9759 in the afternoon. Not able to recover as of this writing the rate remains near the lows at 1.9778 area. EURO fell in sympathy as well finding stops at 1.5700, 1.5660, and what appears to be long-liquidation stops at 1.5600 for a low print at key support at 1.5550 area; low print at 1.5552 before bouncing. Post liquidation rallies in all pairs were dismal and the USD appears to have potential to consolidate these gains overnight. USD/JPY rallied past the 108.00 handle for a high print at 108.31 before offers capped the move; traders say exporter offers and long-liquidation selling plus long-term players and semi-official selling made for a hard top; traders expect the USD/JPY to fall back despite the firmness seen elsewhere. Both Swissy and Loonie are topping as well I think and the next 24-48 hours of hard US data likely to increase volatility a bit. Look for the USD to consolidate these gains and perhaps have a bit of two-way trade or early profit taking but if US data is dollar-friendly then the USD may have another leg higher in store near-term. Aggressive traders need to be ready to sell into this rally as the move is at key resistance across the board. The next day or so we will have short trades.

EURO/USD Daily
Resistance 3: 1.5840/50
Resistance 2: 1.5800
Resistance 1: 1.5750/60
Latest New York: 1.5582
Support 1: 1.5550
Support 2: 1.5520/30/30
Support 3: 1.5500

Comments
Low prints at MAJOR support; hard and fast break likely to encourage a round of short covering. Look to re-short later�OK to stay flat a bit as we just took a huge win from the short side. Close back under the 1.5700 area pressures buying signals; not a lot of bids due soon. Rate continues to track Cable and vice-versa. Stops above the 1.5820 area likely back out of range for today after the drop this morning. Stops under the 1.5620/30 area were as expected; now that they are cleared a rotation higher is coming.

Data due Wednesday: All times EASTERN (-5 GMT)
5:00am EUR Consumer Confidence

USD/JPY Daily
Resistance 3: 109.00/10
Resistance 2: 108.80
Resistance 1: 108.40/50
Latest New York: 108.13
Support 1: 107.20/30
Support 2: 106.80
Support 3: 106.50

Comments
Rate finds stops to drive higher but offers are massive traders say. Out of longs with nice gain; ok to reverse and short the rate but I am inclined to wait a day or so. Volumes were higher and suggest a lot of bids trying to score higher action but offers contain them. Equities continue to drag on the pair but close above 108.00 likely to inspire more two-way action. More stops beyond above 108.50 in large size traders say. Rate likely to attempt more gains if oil drops and equities rally. Exponential reversal signal still valid, expect more two-way action and a test of the highs.
Data due Wednesday: All times EASTERN (-5 GMT)
7:15pm JPY Manufacturing PMI

Analysis by: Forexpros.com written by Jason Alan Jankovsky

Disclaimer:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.

[ForexPros]

Today�s US Dollar Trading
� USD starts mixed then rallies
� USD/CAD rallies to a new high
� Volumes moderate

Overnight Preview
� Likely early follow-on buying of USD
� Should be quiet ahead of FOMC

Looking Ahead to Thursday
All times EASTERN (-5 GMT)
� 10:00am USD ISM Non-Manufacturing Composite
� 2:15pm USD FOMC Statement
� 2:15pm USD Federal Funds Rate

Summary
The USD is higher against most pairs today after a mixed start overnight. A dropping oil market helped the Greenback and the early rally extended after the London fix for USD/CAD and USD/JPY. Both pairs made highs into the end of the trading day surprising most desks with the firmness on the move. The rumored option barrier at 1.0310 area in Loonie fell as stops above got triggered for a high print at 1.0371 as the rate ground through reported offers around the 1.0340/0 area. The rate is now sitting at the highest level it�s been at all year and possibly set to take on a new high. Traders report more offers layered ahead of the 1.0380 through 1.0400 areas so action could get choppy. Stops out of range on the day but just barely; aggressive traders can hold open shorts. USD/JPY also rallied today clearing light stops at the 108.10/20 area for a high print late in the day at 108.30; still technically an inside range day. Traders note offers are remaining thick and exporters are on the offer actively. Additionally, volumes were light on the move suggesting the rate may have had some extra chop due to thin conditions. EURO had a nice rally touching the 1.5620 area before being pushed back; high prints at 1.5632 as oil rallied this morning but once oil fell back the Greenback flew higher taking out light in-range stops set by early longs. Across the board the USD firmed after the London fix, GBP had the lows on the day late in sympathy with EURO most agree; GBP now under the July lows suggesting more weakness on the way. In typical technical fashion the GBP had a lot of interest in cross-rates today with Sterling-Yen and EURO/GBP both having a two-way day. For the most part, today�s USD trading was technical in nature as the USD found close-in stops to help drive action today. On a pre-report day such as tonight/tomorrow more technical trading is expected. Look for the Greenback to remain range bound and sideways; it should get real quiet as the markets brace for FOMC on Tuesday. Market sentiment is for no rate change and no change to the statement. I look for the majors to consolidate for the most part.

GBP/USD Daily Forex Analysis
Resistance 3: 1.9850
Resistance 2: 1.9820/30
Resistance 1: 1.9780
Latest New York: 1.9623
Support 1: 1.9600
Support 2: 1.9550/60
Support 3: 1.9520

Comments
Rate follows EURO higher then lower, finds stops on post-news drop; good bids seen on the dip into 1.9600. Fails to hold early gains on very light volumes. Nothing really happening; some cross trading likely but not a lot of chatter about sterling crosses overnight. Traders report some reserve-manager buying on the dips but also offers capping. Rate is two-way in sympathy with EURO. Possible buying from semi-official names so watch the news. Offers above the market mixed with stops from late shorts so be ready for whipsaw the next few days. Traders expect GBP to track EURO through this week. Continue to expect a lot of cross-trading.
Data due Tuesday: All times EASTERN (-5 GMT)
Tentative GBP Halifax HPI m/m
4:30am GBP Manufacturing Production m/m
4:30am GBP Services PMI
4:30am GBP Industrial Production m/m
7:01pm GBP Nationwide Consumer Confidence
7:01pm GBP NIESR GDP Estimate

EURO/USD Daily Forex Analysis
Resistance 3: 1.5750
Resistance 2: 1.5700/10
Resistance 1: 1.5620/30
Latest New York: 1.5586
Support 1: 1.5540/50
Support 2: 1.5520/30
Support 3: 1.5500

Comments
Rate two-way all day but holds support, rate remains in tight range but toolbox gives a buy signal. Low prints again at MAJOR support. Hard and fast break from US data last week meets with no follow-on selling; likely to encourage a round of short covering next day or two. Look to re-short later; rate feels like it wants to rally off these lows. Aggressive traders can buy this dip for a return to resistance. Continued trade under the 1.5700 area pressures buying signals; �dead cat bounce� is likely today but if volume are there, need to hold a bit. Rate continues to track Cable and vice-versa. Stops above the 1.5820 area likely back out of range for today after the drop last week. Now that stops are cleared a rotation higher is coming.
Data due Tuesday: All times EASTERN (-5 GMT)
4:00am EUR Services PMI ®
5:00am EUR Retail Sales m/m

Analysis by: Forexpros.com written by Jason Alan Jankovsky

Disclaimer:
Trading Futures and Options on Futures and Cash Forex transactions involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.