ForexAnalysis

Daily Forex Trading Analysis 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 forex 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. forex[/acronym]-technical-analysis/gbp-usd"]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 Provided by: Forexpros.com written by Jason Alan Jankovsky Also Check our Forex brokers section 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.

Read the Daily Forex Analysis Overnight Asia/Europe • USD mixed, volumes modest • UK news disappoints Cable • Technical trade overnight Today’s Economic Reports All times EASTERN (-5 GMT) • 10:00am USD ISM Manufacturing Index • 10:00am USD ISM Manufacturing Prices • 10:00am USD Construction Spending m/m 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 is starting the week mixed in New York this morning as overseas news drives early interest in the USD. Negative news in the UK prompted a strong selling day in the GBP today, Cable dropping to a low print at 1.9595 before attempting a recovery. Reports of forex traders increasing short sales of UK retailers’ stocks, negative press on Prime Minister Brown and reports that a large number of UK households have slipped into negative equity weighed on Sterling to start. Cross spreaders have had a great start to the week as the Sterling side of everything has pushed all the rates sharply higher. This has hurt EURO as the two pairs are tracking each other; EURO unable to extend gains from Friday and is trapped in the lower end of its early range; low prints at 1.5513 and highs at 1.5571 are making for dull trade. Good demand from Asian sovereign names was seen traders say around the opening range at 1.5550 area but offers from a well-respected German name capped the potential rally early. EURO trading right down the middle of the range in early New York at 1.5530 area. USD/JPY is slightly weaker with lows at 104.64; traders note stops on the break triggered at 104.90 area and the USD bulls are now on the defense. Asian volumes were lighter but the USD/JPY will likely remain on the defensive this week as no real news from the Japanese is seen as potentially market moving but US data due later will likely have an impact; look for the rate to continue to trade two-way with a lower bias for the week. If holding shorts in the rate look to add soon depending on the quality of the close today. Ideally, you would like a failed low-volume rally to sell into. Swissy continues to grind lower as well but has found some technical support overnight at the May daily pivot point at 1.0390; Monday’s low so far at 1.0389. Traders note that large stops are building in the 103.80/90 area suggesting that the late longs form last week are set to bail. Support is not heavy until the 1.0280 area and a hard break could be in the works there. In my view, the USD is set to resume its downward action this week. I would look for two-way action into the NFP data on Thursday with a break coming later in the week. For the most part the higher action against the GBP is a near-term “head fake” and not indicative of the overall market bias. Look for the EURO and GBP to recover higher by mid week. GBP/USD Daily Resistance 3: 1.9780 Resistance 2: 1.9720 Resistance 1: 1.9680 Latest New York: 1.9610 Support 1: 1.9600 Support 2: 1.9550 Support 3: 1.9520 Comments Rate reverses hard again after strong rally on Friday, Rate likely to see support come in around the 1.9630 area but volatility could whipsaw from that area. 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. 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/CHF Daily Resistance 3: 1.0550 Resistance 2: 1.0500/10 Resistance 1: 1.0480 Latest New York: 1.0422 Support 1: 1.0380 Support 2: 1.0350 Support 3: 1.0310/20 Comments Rate weakens in early Asia and now remains two-way in light directionless trade. Traders say stops are likely building under the 103.80 area and a drop into lows mid-week is expected now that the rate failed again at the 1.0520 area. The late longs will have to bail if the rate slides back under the 1.0400 area; some of them likely out overnight. Look for rallies to be sold and the 104.80 area to hold key resistance on an upside rally. News this week is likely to remain non-eventful until NFP later. In my view, the rate needs to be sold on any strength; possible short at the 1.0450/60 area for today but that is a long-shot due to the trade under the 1.0400 area already. Looking to re-short the next 24 hours—our stop just close enough today to tag us out. Data due Tuesday: All times EASTERN (-5 GMT) 1:45am CHF CPI m/m 0.4% Analysis Provided by: Forexpros.com written by Jason Alan Jankovsky Also Check our Forex Brokers section 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.

Here's Our Daily Forex Analysis Today’s US Dollar Trading • USD starts lower in Asia, rallies in Europe • Rallies on Durables data then fades • Ends New York Mixed Overnight Preview • Look for the USD to continue under pressure ahead of GDP tomorrow • Volumes should drop off also Looking Ahead All times EASTERN (-5 GMT) • 8:30am USD Prelim GDP q/q 0.9% • 8:30am USD Prelim GDP Price Index q/q 2.6% • 8:30am USD Unemployment Claims 370K • 10:30am USD Crude Oil Inventories • 10:30am USD Natural Gas Storage • 2:30pm USD Fed Chairman Bernanke Speaks • 7:00pm USD Fed Vice Chairman Kohn Speaks Summary The USD ends the day mixed after a slow start in Asia; initial early strength after Durable Goods data hit the street fades into the London Fix. The USD went nowhere after the fix and forex traders complained of low volumes, thin conditions and dull ranges. After the better-than-expected Durables data provided a solid rally the sellers came out at expected resistance and the USD never challenged those prices again all day making for a toppy chart formation. Model and Momentum accounts were seen in some pairs on the bid for USD suggesting that the potential top may actually be in place across the board. Some price action after the best levels of the day for the USD offer compelling reasons to stay on the short side through the end of the week. Cable advanced to the 1.9830 area overnight Asia only to be met with selling that found close-in stops at the 1.9770 area and below for a low print after durables at 1.9703; bids lifted the rate back over the 1.9800 handle to trade firm all day in less than two hours. A 100 point move in both directions whipsawing both sides to finish higher on the day; not a good sign for the bears. EURO also stopped short on support, holding the 1.5600 handle after a sharp stop-driven break for a low print at 1.5603 before sovereign names were seen on the bid. The 50 bar MA comes in as support at the 1.5661 and although a technical sign of potential slippage; the fact that the rate found no real stops in size on a break below the MA suggests that there is no one willing to sell under the 1.5660 area. Now that weak longs have been cleared, all the remains is to see if late shorts sold EURO into the hole today. Should that be the case; expect a rally the next 24-48 hours. USD/JPY rallied through stops and resistance for a high print at 105.33 clearing all the weak shorts out before dropping back to trade 104.60 area most of the afternoon. A very long selling wick on USD/JPY today suggests that the rate is due for a retest of the near-term lows under the 103.00 area; some desks report that selling interest at the highs was from exporters and semi-official names. Swissy had a similar day but finished off the highs and nowhere near the real resistance numbers the active bears would like to see. Highs at 1.0426 were never challenged and the rate fell back to under the 1.0390 breakdown number. A close below the 1.0390 area argues for a test of the 1.0280 area again as volumes on the rally were light. Look for a quiet evening ahead of GDP tomorrow. forex[/acronym]-technical-analysis/eur-usd"]EUR/USD Daily Resistance 3: 1.5880 Resistance 2: 1.5850 Resistance 1: 1.5810/20 Latest New York: 1.5645 Support 1: 1.5620 Support 2: 1.5600/1.5590 Support 3: 1.5550 Comments Rate crosses the 50 bar MA with higher volume; more losses on the way but move into the stops finds no one home; selling pressure likely not big enough now to move below the 1.5600 area easily. Support at 1.5550 likely to hold on further weakness. Overhead resistance appears firmer on the approach to the 1.5800/20 area with stops said to be out of range above around the 1.5850 area. Traders note that the rate feels “heavy” to start the week and warn of a potential overhang of stale longs; which may have been cleared on today’s dip to 1.5600. Stops under the 1.5700 area were in size overnight and volume was good. Look for model and momentum accounts active tonight—we need them on the offer as the break lower was negated by the bounce. Adding to the potential is the COT data showing a flip to net long from net short before the holiday; a washout is likely in my view and that may have been the move lower today. Data due Thursday: All times EASTERN (-5 GMT) 3:55am EUR German Unemployment Change -25K 4:00am EUR M3 Money Supply y/y 10.3% 5:00am EUR Consumer Confidence -12 USD/JPY Daily Resistance 3: 105.80 Resistance 2: 105.50 Resistance 1: 105.20/30 Latest New York: 104.62 Support 1: 104.20/30 Support 2: 103.80 Support 3: 103.20/30 Comments Rate powers through offers at the 104.50 area and stops drive the rate to next resistance at the 104.80 area; fails at the highs. After US news is out this morning, expect a rally into the 105.10/20 area to be sold; we opened an aggressive short in that area today. Caution on the potential top is the rate closing over the 100 bar MA today. COT data showing an increase of net JPY longs making the upside potential for the USD a bit higher in my view; but that was likely the pop this morning. Stops the other side of 104.50 were in size suggesting that speculators got heavily short near current market pricing as 104.50 area is in range with the recent weekly highs. This week’s data may support near-term as the USD has had a lot of bad press the past quarter and has managed a firm start to the year; perhaps the Yen has a further downside correction to go before the USD bears are again out in force. Data due Thursday: All times EASTERN (-5 GMT) 7:15pm JPY Manufacturing PMI 48.6 7:30pm JPY Core CPI y/y 1.0% 7:30pm JPY Core Tokyo CPI y/y 0.9% 7:30pm JPY Overall Household Spending y/y -0.7% 7:30pm JPY Unemployment Rate 3.9% 7:50pm JPY Industrial Production m/m Analysis Provided 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.

Read the Daily Forex Trading Analysis Today’s US Dollar Trading • USD starts slow; makes a show for strength in NY • US data mixed and of little help • Traders await more tomorrow Overnight Preview • Look for a rally in the USD overnight • Lack of downside follow-on selling seen Looking Ahead All times EASTERN (-5 GMT) • 8:30am USD Core Durable Goods Orders m/m -0.4% • 8:30am USD Durable Goods Orders m/m -1.5% • 9:00pm USD Dallas Fed President Fisher Speaks • 12:50pm USD Minneapolis Fed President Stern Speaks Summary The USD enjoyed a day of higher pricing but failed to break into any new areas of S/R against the majors. For the most part the Greenback remained inside established ranges but is showing signs of bottoming and very well may rally the next 24 hours. Today’s US data was a mixed bag and Forex traders note that across the board the USD attracted a fairly large amount of bids relative to the volume on the day. Although the day was considered a scratch day by most the USD continued to firm into the close of New York trading. After a brief flurry of activity during the release of Housing Data this morning the rest of the day was uneventful but continued to lean on the bid side suggesting that late USD shorts have yet to be cleared if they were shorts set “on the news” as is typical for small-money accounts. Cable dropped to the low end of the range but was unable to score new lows in New York; overnight stop-driven lows at 1.9713 remained unchallenged into the New York close. Traders note that the rate is tracking EURO today and because EURO was under threat most of the session GBP held on the softer side. EURO made new lows for the day at the 1.5700 handle on the AM news but failed to attract size on the offer. The rally to the 1.5730 area was on light volume and the rate fell back to close near the 1.5720 area in thin trade. A low-volume day after a three-day weekend suggests that large traders are secure in their positions and haven’t made a move yet this week. USD/JPY has a big day ahead of itself tomorrow in my view as COT data suggests that the market is heavily short USD into the 104.20 area. Although large stops are still out of range it is very likely that the rate will try for highs within 24 hours as the lows today were bought hard enough to challenge the 104.20 area on three occasions today. Often that is a sign of a market looking to make a move. For the day—the USD trade remained technical in nature and the lack of follow-on selling suggests that the market has one push higher into resistance coming. Aggressive traders need to be ready to sell the USD on a spike higher and tomorrow’s action likely to give us a point of reference in at least two-pairs: 104.80 area in USD/JPY and 1.5650 area in EURO/USD. Look for US news to increase volatility but for the pairs to stall at previous S/R during the London fix tomorrow. forex[/acronym]-technical-analysis/eur-usd"]EUR/USD Daily Resistance 3: 1.5880 Resistance 2: 1.5850 Resistance 1: 1.5810/20 Latest New York: 1.5699 Support 1: 1.5700/1.5690 Support 2: 1.5650 Support 3: 1.5600 Comments Rate holds inside range so far for the day but is evidently starting the week a bit softer. Overhead resistance appears firmer on the approach to the 1.5800/20 area with stops said to be out of range above around the 1.5850 area. Traders note that the rate feels “heavy” to start the week and warn of a potential overhang of stale longs. Stops under the 1.5700 area are said to be in size and bids ahead are from larger names, Lack of volume a concern but no trouble attracting selling pressure today. Look for model and momentum accounts to be on the bid the next 24 hours and should that be the case the rate is due for a break lower. Adding to the potential is the COT data showing a flip to net long from net short before the holiday. A washout is likely in my view. Data due Wednesday: All times EASTERN (-5 GMT) 2:00am EUR German Import Price Index m/m 0.6% 4:00am EUR Current Account 4.3B Tentative EUR German CPI m/m (p) 0.3% USD/JPY Daily Resistance 3: 105.00/10 Resistance 2: 104.80 Resistance 1: 104.40/50 Latest New York: 104.24 Support 1: 103.20/30 Support 2: 103.00/102.90 Support 3: 102.50 Comments Late rally shows upside bias still working. Rally into the 104.80 area is the best potential short area in my view. COT data showing an increase of net JPY longs making the upside potential for the USD a bit higher in my view. Stops above the 104.10/20 area likely to be in size and the question is how big are the offers ahead of 104.40? Stops the other side of 104.50 said to be in size suggesting that speculators got heavily short near current market pricing as 104.50 area is in range with the recent weekly highs. This week’s data may support near-term as the USD has had a lot of bad press the past quarter and has managed a firm start to the year; perhaps the Yen has a further downside correction to go before the USD bears are again out in force. If this weeks’ data is USD supportive then the rate has a pop higher into resting offers coming. Watch the upside volume for clues to the speed of the rally; if it is coming. Data due Wednesday: All times EASTERN (-5 GMT) Tentative JPY BOJ Governor Shirakawa Speaks 7:50pm JPY Retail Sales y/y 0.5% 7:50pm JPY Large Retailers' Sales y/y -1.1% In association with Forex Trading Edge 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.

Daily Forex Analysis Pattern Main Trend: Up Main Trend Top: None Main Trend Bottom: 1.5283 (05-08-08) Current Pattern: Reversal Top 1.5814 (05-22-08) Price 1.6019 Main Top (04-22-08) 1.5894 Gann Angle Down 1.5814 Closing Price Reversal Top (05-22-08) 1.5769* Gann Angle Down 1.5771 New York Close 1.5803* Gann Angle Up 1.5549 50% Retracement 1.5543 Gann Angle Up 1.5486 .618 Retracement Time 05-23 180 Day Cycle 06-03 180 Day Cycle 06-05 Anniversary Date Top (06-05-07) Analysis The Main Trend is up. The closing price reversal top at 1.5814 on 04-22 has not been negated nor confirmed. A trade through 1.5814 negates the reversal top. A trade through 1.5612 confirms the reversal top. If the reversal top is confirmed then look for the start of a retracement to 1.5549 to 1.5486. A down trending Gann angle at 1.5769 is providing resistance. Regaining this angle would put the market in a strong position to rally. The next upside target would be a down trending angle at 1.5894. Up trending Gann angle support comes in at 1.5803. A failure to hold this price indicates weakness and a possible break back to up trending support at 1.5543. The read today is how the forex market trades at 1.5803 and 1.5769. These two angles are controlling the short-term direction of the market. Go the way of the move on a breakout of either angle. Written by James Hyerczyk 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.

Read the Daily Forex Trading Analysis Today’s US Dollar Trading •USD sharply lower •German data surprises, EURO higher •US PPI not so good Overnight Preview •Look for a correction lower by the majors; today’s rally overdone? Looking Ahead to Wednesday All times EASTERN (-5 GMT) •10:30am Crude Oil Inventories 0.2M •1:00pm Fed Governor Warsh Speaks •2:00pm FOMC Meeting Minutes Summary The Greenback is weaker to end the day and the sharp rise by the majors stopped at technical resistance across the board suggesting that the move was a bull-trap. All the majors look really bullish into current pricing but volumes were a bit lighter than might be expected suggesting that the pairs may have overextended themselves today. Most of the action was EURO-centered as cross-spreaders and sympathy buying kept the rate firm through stops in the 1.5600 area and above fueled the move into the high prints at 1.5681. Forex Trader’s note that the rate stopped cold and volumes dried up after the fix; possible correction to test the rally on the way. Aggressive traders can look to sell EURO in this area looking for a break into the low 1.5500 area the next 24-48 hours; IFO out tonight might surprise and help a correction get started. Cable rallied through stops as well for a high print at 1.9721 before falling back under the 1.9670 area and again traders note volumes dropped off dramatically after the fix. Subscribers should liquidate their long GBP positions and look to buy a pullback as the target/objective was basically reached as the volume dropped off. USD/JPY continued to weaken and low prints during mid-day at 103.44 failed to trigger large stops rumored to be resting in the 103.50 area; if nobody is home at these prices then a short-term bounce is very likely and a rally should fail quickly on any test of the 104.20 area or so. In my view, the USD had a hard and fast break that maybe went a little too far too fast. It’s OK to take advantage of the aggressive slide but note that the rotation the other way likely to be short and sweet also. Look for German IFO tonight to create a bit of volatility and for the most part the big news for the week is out. The rest of the week will likely be technical trading and volumes are likely to remain subdued. After a market makes a big move unexpectedly most traders look to take a step back. The US Memorial day weekend is this week and the prospect of a three-day weekend in the largest FX market will also likely keep traders sidelined. I would look for the week to start winding down Wednesday night into Thursday trade; lots of people will want to get a head-start on the weekend. forex[/acronym]-technical-analysis/gbp-usd"]GBP/USD Daily Resistance 3: 1.9780 Resistance 2: 1.9750 Resistance 1: 1.9720 Latest New York: 1.9677 Support 1: 1.9620/30 Support 2: 1.9580 Support 3: 1.9550 Comments Rate rallies in sympathy with EURO and clears close-in stops; aggressive active buying noted some desks report. High prints at the 1.9720 area is near-term resistance and a bout of long-liquidation is expected. OK to cover longs. Rate likely to have a fall-back should EURO drift lower now that the major news is out for the week. Close above the 1.9580 area favors additional strength but I still think there is potential selling pressure coming. Rate tested the 1.9700 handle after PPI this morning and volumes after the fix into the highs were lower.Cross-spreading for Yen, Swissy and EURO evident for the past week. Likely sovereign demand on the crosses as well again this week. Data due Wednesday: All times EASTERN (-5 GMT) 4:30am GBP MPC Meeting Minutes 7-2 cut 4:30am GBP M4 Money Supply m/m 0.6% 4:30am GBP Public Sector Net Borrowing 1.8B USD/JPY Daily Resistance 3: 104.80 Resistance 2: 104.50 Resistance 1: 104.10/20 Latest New York: 103.59 Support 1: 103.40/50 Support 2: 103.20/30 Support 3: 102.80 Comments Rate falls back after a weak rally in Asia; traders note that stops are building in size under the 103.50 area with bids layered below to 103.00 area. Stops said to be large enough to drive the rate through bids for a test of the 102.80 area. Failure to score the 105.00 handle very significant in my view. Upside will continue to be labored now in my view but be nimble on shorts; we need a solid close under the 103.80 area next. If PPI disappoints today, that may be in the works for this afternoon. Conviction of the sellers being challenged but I think the weak hands are the longs as the volumes are increasing on the breaks and lighter on the rallies. Traders note that the market continues to trade technically and expect stops to be run in both directions near-term; Day traders continue to get a lot of opportunity as the rate will likely cover a lot of the same ground twice on the hourly time frame. Resistance at 104.80 area remains significant now and rallies should be sold. Data due Wednesday: All times EASTERN (-5 GMT) 7:50pm JPY All Industries Activity Index m/m -0.2% 7:50pm JPY Trade Balance 0.79T In association with Forex Trading Edge 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.

Daily Forex Analysis Today’s US Dollar Trading •USD rallies in light volume •Traders say today was a “stop hunt” •Short-term traders active Overnight Preview •USD likely to fall back, European data may lift EURO Looking Ahead to Tuesday All times EASTERN (-5 GMT) •8:30am USD PPI m/m 0.4% •8:30am USD Core PPI m/m 0.2% •9:00am USD Fed Vice Chairman Kohn Speaks •9:00am USD IBD/TIPP Economic Optimism 38.0 •10:00am USD Fed Publishes TAF Summary Summary The hardly-watched LEI data today came out better-than-expected this morning and the USD saw a stop-driven rally ensue until after the London fix when the Greenback came under renewed pressure. Forex Traders note that volumes were not high and that it was clear that the majors had a short-lived stop-driven break; S/R held as expected and aside from a few wrong-footed panicked accounts the day was really a typical no-news day. I think the rally in the USD was seen as a bit too much for current conditions and waiting for both US and European news due out the next 24 hours. Overnight in Europe is German IFO and ZEW data likely to help the EURO build on a recovery off today’s 1.5484 low prints; highs in Europe this morning at 1.5634 went unchallenged in NY trade today. Absent were official names seen on the bid the past few sessions with most of their activity well below today’s lows suggesting that major names are unconcerned with today’s volatility. GBP fell back on stops as well tracking EURO lower until the low prints at 1.9452 where bids finally took a stand. Trading to within a few pips of the 1.9500 handle after the break the GBP remained under the 1.9500 handle through the close. Should EURO rally on positive economic news the GBP might go with it as there is nothing of note on the books for the UK overnight. USD/JPY and USD/CHF both had a strong stop-driven rally but both pairs finished well off their highs on the day and generated strong sell signals. USD/JPY had a high print at 104.71 before reversing to finish under the 104.30 area. USD/CHF had a high at 1.0575 and also finished under the 1.0530 area; both rates were rallying largely on light volumes and the moves were mostly exaggerated I think. I would look for both rates to fall back overnight and continue to attract selling on rallies. Ahead of US data in the morning I would look for some book-squaring; German data will likely cause a little volatility so leave stops where they are if holding positions. We were stopped out of short USD/CHF today but added to short USD/JPY; tomorrow should be an interesting day and I expect USD downside to follow-through as today’s trade was a “head-fake” I believe. USD/JPY Daily Resistance 3: 105.00 Resistance 2: 104.80 Resistance 1: 104.50/60 Latest New York: 104.33 Support 1: 103.60 Support 2: 103.20/30 Support 3: 103.00 Comments Stops drive the rate higher and after Friday’s stop-driven break the order boards are likely wiped clean. Failure to score the 105.00 handle very significant in my view. Strong sell signal from the toolbox today so OK to add to the open shorts. Upside will be labored now in my view but be nimble on shorts; we need a solid close under the 103.80 area next. Conviction of the sellers being challenged but I think the weak hands are the longs as the volumes are increasing on the breaks and lighter on the rallies. Look for the rate to continue sideways overnight as today’s stop-frenzy was unexpected. Traders note that the market continues to trade technically and expect stops to be run in both directions near-term; close-in stops under the 103.50 area likely in size today. Day traders continue to get a lot of opportunity as the rate will likely cover a lot of the same ground twice on the hourly time frame. Stops could be in size at the 102.50/80 area also but active selling needed. Resistance at 104.80 area remains significant now and rallies should be sold. Data due Tuesday: All times EASTERN (-5 GMT) 7:50pm JPY Tertiary Industry Activity Index m/m 0.5% Tentative JPY Overnight Call Rate 0.50% 2:00am JPY BOJ Monthly Report Tentative JPY BOJ Press Conference In association with Forex Trading Edge 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.

Read the Daily Forex Trading Analysis Today’s US Dollar Trading •US data a mixed bag, housing head-fakes everyone •Stops drive a reversal after early strength •Majors under support near-term Overnight Preview •Look for two-way consolidation on Monday •More losses for USD coming I think Looking Ahead to Monday All times EASTERN (-5 GMT) •10:00am USD Leading Index m/m Almost no news for Monday anywhere. Trading should be largely technical Summary The USD bulls got their horns sawed off today as better-than-expected Housing data sucked the late long into the top for the week. Across all pairs the USD rallied on the news but was unable to score new weekly highs and within an hour of the news the Greenback was under dire pressure and made lows across the board in heavy volume. Reaching technical support after the London Fix the rest of the day was spent in clean-up as the volumes dropped off and the majors went sideways to consolidate their gains. Cable rallied into stops and blasted through several layers of serious offers to post a high print at 1.9601 making a new high for the week on a Friday suggesting the rate will advance early next week. If holding longs look to add on a pullback for an attempt at the 1.9700 area by mid-week. EURO rallied for a new weekly high as well and flushed stops above the 1.5550 area for a high print at 1.5602 and failed to attract serious sellers. Traders note that aggressive offers by sovereign names as well as private Swiss bank selling failed to absorb bids; most order books were wiped clean of offers and it is likely the rate will advance early next week as well. Some analysts suggest that high Oil prices had an effect of firmer EURO but I think that is an attempt to lay blame for late selling. USD/JPY fell through several layers of support exposing large stops in the process. Stops at 104.40 by late longs were enough to make a low print under the 104.10 area exposing stops at 104.00, 103.80 and 103.60; the latter attracting bids but not before a low print at 103.51 washed out the last late long. The pair briefly rallied to regain the 104.00 handle but some of that may be residual short-covering after the early bloodbath. Swissy and Loonie also saw slippage with all major cross falling back as well. In my view, the USD has set-up for further declines next week. Due to the intraday volatility I would expect a lot of two-way action but today’s one-way slide suggests that the market is unable to attract serious buying the next 72 hours. USD bears need to sell rallies and look for the majors to cover a lot of the same ground twice; day Forex traders will have a lot of money to make next week in my view. Monday is a light day for news and the whole week is likely to be technical trading so if not positioned with a lead be patient. There will be a lot of opportunity in my view. forex[/acronym]-technical-analysis/eur-usd"]EUR/USD Daily Resistance 3: 1.5680 Resistance 2: 1.5630/40 Resistance 1: 1.5600/10 Latest New York: 1.5588 Support 1: 1.5550 Support 2: 1.5500 Support 3: 1.5480 Comments Rate hammers the shorts; close above the 1.5550 area argues for additional follow-on buying but expect offers on the approach to 1.5630/40 area. Crude prices likely offering a bit of volatility. Traders like the rate to the upside as stops have been cleared underneath for now; longs likely to have rolled up stops under the 1.5520 area so volatility possible; don’t expect one-way action Monday. OK to re-short at 1.5620/30 area but be nimble; the rate is setting up for a potential upside recovery. Rally back from dip under the 1.5400 handle suggests active buying on dips; traders say lots of official and sovereign names seen buying dips. More losses are coming but the jury is out on the length of the bounce in progress. Data due Monday: All times EASTERN (-5 GMT) USD/JPY Daily Resistance 3: 105.00 Resistance 2: 104.80 Resistance 1: 104.50/60 Latest New York: 104.15 Support 1: 103.70/80 Support 2: 103.50 Support 3: 103.00 Comments Stops drive the rate lower but the recovery off the low prints is a caution to bears. Upside will be labored now in my view but be nimble on shorts; ok to add to the rate on further losses. Bids held the rate up for a test of the 105.00 handle this morning but the weakness is there into the end of New York so look for light volume rallies to sell into. Conviction of the sellers being challenged but I think the weak hands are the longs as the volumes are increasing on the breaks and lighter on the rallies. Look for the rate to fall on the news today but intraday volatility likely. Double-top remains strong sell signal suggests resistance area is getting thicker. Traders note that the market continues to trade technically and expect stops to be run in both directions near-term; close-in stops under the 104.30 area cleared overnight. Day traders continue to get a lot of opportunity as the rate will likely cover a lot of the same ground twice on the hourly time frame. Stops could be in size at the 102.50/80 area also but active selling needed. Resistance at 105.50 area remains significant now and rallies should be sold. Traders looking for a struggle to get over the 105.50 area. Data due Monday: All times EASTERN (-5 GMT) 7:50pm JPY Tertiary Industry Activity Index m/m 1.7% Tentative JPY Overnight Call Rate In association with Forex Trading Edge 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.

Daily Forex Analysis Today’s US Dollar Trading •USD rallies ahead of News, lacks follow-through •Majors on S/R volumes low •Sovereign names seen selling USD Overnight Preview •A round of book-squaring likely Looking Ahead to Thursday All times EASTERN (-5 GMT) •8:30am USD Empire State Business Conditions Index 0.1 •8:30am USD Unemployment Claims 370K •9:00am USD TIC Net Long-Term Transactions 63.6B •9:15am USD Capacity Utilization Rate 80.1% •9:15am USD Industrial Production m/m -0.3% •9:30am USD Fed Chairman Bernanke Speaks •10:00am USD Philadelphia Fed Manufacturing Index -19.0 •1:00pm USD NAHB Housing Market Index 20 •7:00pm USD Fed Governor Mishkin Speaks Summary The USD rallied today after a slow start again in Asia helped by better equities pricing and model/momentum accounts buying; Forex traders note that volumes were not impressive and the majors all held significant S/R. Initially two-way in Asia the Greenback went one-way on stops and aggressive buying near the start of European trade as reserve managers bought USD in the morning only to see the majors reverse after news; the USD sold off on the BOE inflation report but then recovered reversing ahead of US data. Today’s CPI data was softer-than-expected and the USD initially broke lower on the day but held existing overnight ranges. Settling back after the London Fix the USD continued to drift in quieter range-bound action with little news driving any of the pairs. Cable continued to hold the 1.9450 area that has held stops in both directions the past 72 hours; low prints at 1.9361 were bought by cross-spreaders and semi-official names traders say. Upside limited to the 1.9487 high but the rate has solid bids at the 1.9400 handle and slightly above. Traders are looking for the rate to hold the 2008 lows and a solid bounce is expected by the end of the week. EURO no less aggressive to the upside but continues to languish under the 1.5500 handle as traders say offers appear thick on the approach. Highs at 1.5487 were met with Swiss private bank sales some traders report; same names seen on the bid under the 1.5400 handle recently. Traders note sovereign demand in EURO at around the 1.5430 area and also in USD/JPY on the buy side. USD/JPY rallied into stops above the 104.80 area and again at 105.20 area for a high print at 105.46 but the rate is really struggling to hold gains and traders report volumes are light and flows patchy; heavy offers said to be around the 105.50 area and higher suggesting the rate is at or near a top. Swissy also encountering strong resistance under the 1.0600 handle; highs at 1.0601 were more symbolic than anything else. Traders are looking for the USD to pull back from here but the lack of selling interest is a concern for the shorts. In my view, the USD needed to give back some of these gains right away rather than hold firm as it has. Tomorrow is another day of important news so watch for book squaring overnight to temper the USD advance. A long-liquidation break is coming and when it does the Greenback could break sharply very quickly. USD/JPY Resistance 3: 106.00 Resistance 2: 105.80 Resistance 1: 105.50 Latest New York: 105.21 Support 1: 104.60 Support 2: 104.20/30 Support 3: 103.80 Comments Rate makes one more high into resistance generating a strong sell signal. Look for the rate to fall on the news but intraday volatility likely. Double-top remains strong sell signal suggests resistance area is getting thicker. Traders note that the market continues to trade technically and expect stops to be run in both directions near-term; look for close-in stops under the 104.50 area today. Continue to expect more volatility. Looking for the rate to briefly follow through higher for a short-covering rally through Tuesday but fall harder into mid week; likely under the 103.00 handle. Day traders may get a lot of opportunity as the rate will likely cover a lot of the same ground twice on the hourly time frame. Stops could be in size at the 102.50/80 area. Resistance at 105.50 area remains significant now and rallies should be sold. Traders looking for a struggle to get over the 105.50 area. Data due Thursday: All times EASTERN (-5 GMT) 7:50pm JPY GDP q/q 0.6% 7:50pm JPY GDP Deflator y/y-1.5% forex[/acronym]-technical-analysis/usd-chf"]USD/CHF Daily Resistance 3: 1.0700 Resistance 2: 1.0650 Resistance 1: 1.0600/10 Latest New York: 1.0552 Support 1: 1.0500/10 Support 2: 1.0450/60 Support 3: 1.0400/10 Comments Rally overnight may be expected in sympathy with YEN but upside is labored; stalling at the 1.0600 handle significant. No follow-through after news this morning is a signal the top may be in. Pullback needed to confirm strong sell signal generated overnight. Monday’s failure above the 1.0500 handle still significant in my view. Likely this rally overnight is model and momentum accounts on the buy side. Upside is limited and the volumes aren’t that great so far today again. Be nimble though as a break below 1.0380 likely to draw aggressive selling. Rate continues to attract dip buying; next dip will likely be bought around 1.0400 area; but last three dips have failed to create significant rally. Close under the 1.0400 area sets up a loss to 1.0250 near-term. Data due Thursday: All times EASTERN (-5 GMT) 1:45am CHF Consumer Climate 5:00am CHF SNB Board Member Jordan Speaks In association with Forex Trading Edge 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.

Daily Forex Analysis Today’s US Dollar Trading • USD extends rally during New York • Flows described as light and disorderly Overnight Preview • Look for book-squaring • USD may have gotten ahead of itself Looking Ahead to Wednesday All times EASTERN (-5 GMT) • 8:30am USD Core CPI m/m 0.2% • 8:30am USD CPI m/m 0.3% • 9:15am USD Fed Governor Kroszner Speaks • 10:30am USD Crude Oil Inventories Summary The USD is higher to end New York after a volatile session after the release of US data. Although the Retail Sales data came in about as expected, upwardly revised data from last month sparked a swift rally in the greenback sending it to the best levels of the day. The USD managed to hold gains against the Yen and Swissy but gave back some gains against EURO and Cable to end the day; traders note that volumes were very patchy on the move and order-flow was sporadic and directionless despite the firm pricing. USD is likely setting up for a rotation lower and the technical picture looks a bit supportive of that view. Cable made a new monthly low at 1.9417 before rotating higher to eventually print 1.9496 for the New York high but well off the European high at 1.9589; traders note the reversal was unexpected after the release of higher than expected UK CPI data this morning. Cable settled around the 1.9450/60 area in quiet trade. EURO fell in sympathy with GBP as cross-spreaders lifted EURO off the post-data lows of 1.5429 and EURO gained the 1.5500 handle again before settling back as flows became confusing after the London Fix. Forex Traders note that EURO appears to have found a near-term bottom and believe support is firm around the 1.5380/1.5400 area. The rate will likely draw some short-covering by late shorts this morning during the next 24 hours so expect a continued grind higher ahead of US data in the morning tomorrow. USD/JPY continued to grind higher all afternoon on light volume; making the high for the day ahead of the close at 104.93 touching the 100 bar MA in the process. Sellers said to have plenty of offers waiting at the 105.00 area and it will be important to see if those offers show up overnight in Japan this evening. Given the recent strength in the Yen this correction higher by the USD is likely to attract sellers and the key is how thick they are at this level. Aggressive traders can look for a short on any further USD strength in my view. Tomorrow is US CPI data and with the recent information tending to support the Fed is not done easing yet, I would expect that a weaker than expected number could ignite a bout of USD long-liquidation in the morning. The market seems prepared for that and recent strength despite weak volumes appears to be an opportunity to sell. USD/JPY Daily Resistance 3: 105.80 Resistance 2: 105.50 Resistance 1: 105.00/10 Latest New York: 104.72 Support 1: 104.20/30 Support 2: 104.00 Support 3: 103.80 Comments Rally back from the Friday lows likely a Head-Fake; double –top has formed and a strong sell signal suggests a potential short is now confirmed at the 105.00/50 area again. Today’s test of the highs stalls on light volume just under the 100 bar MA. Late sell-off significant as longs likely threw in the towel. Stops above 104.30 area drove trade today; they are gone so look for the rate to rotate lower overnight. Rate has broken trend line support and Tuesday’s attempt to score a high over the 104.00 handle may be the test of the trend line break. Traders note that the market continues to trade technically and expect stops to be run in both directions near-term; some of which likely happened overnight Tuesday. Continue to expect more volatility. Looking for the rate to briefly follow through higher for a short-covering rally through Tuesday but fall harder into mid week; likely under the 103.00 handle. Day traders may get a lot of opportunity as the rate will likely cover a lot of the same ground twice on the hourly time frame. Stops could be in size at the 102.50/80 area. Resistance at 104.80 area remains significant now and rallies should be sold. Data due Wednesday: All times EASTERN (-5 GMT) 7:50pm JPY Core Machinery Orders m/m -5.2% forex[/acronym]-technical-analysis/usd-chf"]USD/CHF Daily Resistance 3: 1.0610/20 Resistance 2: 1.0580 Resistance 1: 1.0550/60 Latest New York: 1.0524 Support 1: 1.0470/80 Support 2: 1.0410/20 Support 3: 1.0380 Comments Rally overnight may be expected in sympathy with YEN and/or weaker commodities but upside appears limited. Pullback from 105.00 area gained some credibility as offers appear from big names traders say. Monday’s failure above the 1.0500 handle significant in my view. Likely this rally overnight Tuesday is testing the break-down; be ready to sell. Upside is limited and the volumes aren’t that great so far today again. Be nimble though as a break below 1.0380 likely to draw aggressive selling. Rate continues to attract dip buying; next dip will likely be bought around 1.0250 area again; but last three dips have failed to create significant rally. Failure last week at 1.0550/1.0600 area is setting up a short; look to sell the next rally; around 1.0500/20 I think. Highs above the 1.0500 area may keep the rate two-way action before a move in either direction. Close under the 1.0400 area sets up a loss to 1.0250 near-term. Data due Wednesday: All times EASTERN (-5 GMT) NONE In association with Forex Trading Edge 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.

Read the Daily Forex Trading Analysis Today’s US Dollar Trading • USD opens mixed, ends lower • Technical levels hold gains in check • Stops in range Overnight Preview • Look for two-way action to continue • Technical trade likely Looking Ahead to Tuesday All times EASTERN (-5 GMT) • 08:30 Export Prices ex-ag • 08:30 Import Prices ex-oil • 08:30 Retail Sales forecast 0.0% • 08:30 Retail Sales ex-auto forecast 0.5% • 10:00 Business Inventories 0.3% This data likely to be a non-event. Markets are really watching for the larger data due on Wednesday. Summary The USD is ending the day heavily mixed to start the week. Initially firmer in overnight Asia the Greenback gave back hard-won follow-on gains from European trade at previous S/R areas against most major pairs. Cable advanced on cross-spreading demand to post a high print in New York for the day at 1.9635 making the day an outside-range engulfing bar on the daily; a strong potential reversal signal from the two-month lows at 1.9441 earlier in the day. Although the trade was considered a strong signal the volumes were not impressive suggesting the rate will follow-through only modestly the next 24-36 hours. EURO rallied back to the potential sell-zone in the 1.5550 area for a high print at 1.5572 before dropping back a bit on the close. Traders note stops in range triggered on the rally over the 1.5450/60 area overnight; lows at 1.5365 went unchallenged in New York. Model account demand also seen suggesting that momentum traders are coming in on the buy side. Also active in USD/JPY, model forex traders likely had their stops too close to protect themselves against a reversal suggesting that the EURO and the Yen will whipsaw traders the next 24-36 hours. Look for a pullback in both pairs; EURO/JPY also active overnight suggesting the USD will remain under pressure against the Yen near-term. Highs in USD/JPY at 104.05 were offered rumored by semi-official names and the rate is off the highs to finish New York. For the most part, the Greenback had a solid two-way day against most of the majors and despite the two-way action is holding between established support and resistance. The GBP likely will follow-through to the upside a bit but sellers are expected to show at the 1.9680/1.9720 area. EURO has likely made the high for the week seeing as no real stops over the 1.5550 area were seen today and that is precisely where they would have been if shorts were active over the weekend; aggressive traders can look to ADD to open shorts in EURO at the 1.5550 area OB today and tomorrow. Looking ahead, expect technical trade to dominate ahead of Wednesday’s CPI data; Tuesday’s data likely no factor. forex[/acronym]-technical-analysis/gbp-usd"]EUR/USD Daily Resistance 3: 1.5600/10 Resistance 2: 1.5570/80 Resistance 1: 1.5550 Latest New York: 1.5535 Support 1: 1.5500/1.5490 Support 2: 1.5450 Support 3: 1.5400 Comments Bounce is developing nicely, rally over the 1.5400 handle significant. Rate holds opening range on the fall-back; solid sign of no sellers left. Rally back from dip under the 1.5400 on stops suggests more losses are coming but a corrective bounce is needed (which is developing now) Support at 1.5280 is firm near-term. Look for rotation higher to end about now—the next 24-36 hours. Rate clears close in stops again. Strong long-liquidation break is still coming; Watch for two-way volatility. Short-covering rally stalled where expected in the 1.5550/1.5600 area again; look to re-short in that area now. Data due Tuesday: All times EASTERN (-5 GMT) Tentative EuroGroup Finance Ministers Meeting forex[/acronym]-technical-analysis/eur-usd"]USD/JPY Daily Resistance 3: 104.80 Resistance 2: 10450/60 Resistance 1: 104.10/20 Latest New York: 103.92 Support 1: 102.50/60 Support 2: 102.00 Support 3: 101.80 Comments Rally back from the Friday lows likely a Head-Fake; double –top has formed and a strong sell signal suggests a potential short is now confirmed at the 105.00/50 area again. Rate has broken trend line support. Traders note that the market continues to trade technically and expect stops to be run in both directions near-term; expect more volatility. Looking for the rate to briefly follow through higher for a short-covering rally through Tuesday but fall harder into mid week; likely in the 10460/80 area. Day traders may get a lot of opportunity as the rate will likely cover a lot of the same ground twice on the hourly time frame. Stops could be in size at the 102.50/80 area. Resistance at 104.80 area remains significant now and rallies should be sold. Data due Tuesday: All times EASTERN (-5 GMT) 7:50pm CGPI y/y 3.6% 7:50pm Current Account 1.95T 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.

Read the Daily Forex Trading Analysis Today’s US Dollar Trading • BOE and ECB leave rates on hold, as expected • USD reverses after starting better overnight • Majors hold key support (?) Overnight Preview • Look for USD to consolidate, possible book squaring ahead of US data Looking Ahead All times EASTERN (-5 GMT) • 8:30am USD Trade Balance -61.4B Summary The USD is sharply lower to end the Thursday US session after initially firming overnight. The absence of major news plus general sentiment RE: the weakness in the US Economy this week put a damper on the potential for the USD to rally significantly and stay there. After a follow-on break into key support the majors reversed out of the lows and actually made highs during early New York trade before settling back to general two-way action. Cable looked set to hold the 1.9600 handle but weak longs dumped positions into the London fix and the rate continued to rotate around the 1.9550 area for the rest of the day; high prints at 1.9629 and lows at 1.9500 have created a technical double-bottom. Traders look for a bout of short covering if the 1.9500 area holds on a test the next 24 hours but with the end of the week due anyway I suspect that shorts will cover ahead of the London Fix tomorrow. EURO also rallied back after a hard fall overnight; initially triggering stops on a break under the 1.5350 area. Active selling and more stops took the rate down to 1.5284 low print before rallying back to make highs on the day at 1.5442 as late shorts were forced to cover. Traders note that system accounts and model accounts were active on the sell side overnight and most likely they were whipsawed adding to the upside bias for the US session. USD/JPY fell into stops as the 104.50/60 area was unable to hold the recent advance; stops under the 104.00 handle also adding to the pressure as were lower equities. Although equities were firmer in NY today the failure to hold gains was seen as a negative for the rate. Traders also note that USD/JPY has possibly broken the recent uptrend channel; stops are said to be resting under today’s low at the 103.60 area suggesting a long-liquidation break may be in the works. Loonie weakened dramatically and the USD/CAD was higher on the day against the sentiment of the market. Traders may be watching crude and gold prices for clues to the rates near-term direction but the 1.0200 handle is still offering solid resistance; highs at 1.0180 again. On the day, the USD has likely made the highs for the week against some pairs. Look for corrective action overnight as the market prepares for the last piece of news for the week; US balance of Trade Friday morning. forex[/acronym]-technical-analysis/gbp-usd"]GBP/USD Daily Resistance 3: 1.9680 Resistance 2: 1.9650 Resistance 1: 1.9620/30 Latest New York: 1.9526 Support 1: 1.9500 Support 2: 1.9480 Support 3: 1.9450 Comments Rate falls through 1.9650 support area and stops drive trade lower, support at 1.9500 area now in play. Bounce likely from here. Look for continuation of the recovery Friday. Look for a re-test of the 1.9600 area within 24 hours; likely ahead of the London Fix Friday. Close under the 1.9700 handle today likely washed out longs; shorts will cover before the weekend. Bounce back to trade at or near the 1.9720 area by the end of the week suggests a rally is coming. Upside remains limited in my view but ranges can be wide as evidenced by the past few days of trade. Sell rallies if not short; buying dips dangerous. Closes over the MA’s likely not to last so a rally over the 100 bar MA a good sell in my view. Some pressure from EURO remains. Cross-spreading for Yen, Swissy and EURO evident. Data due Friday: All times EASTERN (-5 GMT) forex[/acronym]-technical-analysis/eur-usd"]EUR/USD Daily Resistance 3: 1.5500/10 Resistance 2: 1.5480 Resistance 1: 1.5450 Latest New York: 1.5400 Support 1: 1.5380 Support 2: 1.5350 Support 3: 1.5300/10 Comments Sharp follow-on break is sold by system accounts; likely a bounce is coming. Rally over the 1.5400 handle significant. Rate holds opening range on the fall-back; solid sign of no sellers left. Break under 1.5300 area on stops suggests more losses are coming; bounce likely first. Support at 1.5280 is firm near-term. Look for rotation higher next 24 hours. Rate clears close in stops again. Strong long-liquidation break is still coming; Watch for two-way volatility. Be ready to re-short quickly if a rally happens; look for a short-covering rally to stall around the 1.5550/1.5600 area again; look to re-short in that area. Data due Friday: 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.

Read the Daily Forex Trading Analysis Today’s US Dollar Trading • BOE and ECB leave rates on hold, as expected • USD reverses after starting better overnight • Majors hold key support (?) Overnight Preview • Look for USD to consolidate, possible book squaring ahead of US data Looking Ahead All times EASTERN (-5 GMT) • 8:30am USD Trade Balance -61.4B Summary The USD is sharply lower to end the Thursday US session after initially firming overnight. The absence of major news plus general sentiment RE: the weakness in the US Economy this week put a damper on the potential for the USD to rally significantly and stay there. After a follow-on break into key support the majors reversed out of the lows and actually made highs during early New York trade before settling back to general two-way action. Cable looked set to hold the 1.9600 handle but weak longs dumped positions into the London fix and the rate continued to rotate around the 1.9550 area for the rest of the day; high prints at 1.9629 and lows at 1.9500 have created a technical double-bottom. Traders look for a bout of short covering if the 1.9500 area holds on a test the next 24 hours but with the end of the week due anyway I suspect that shorts will cover ahead of the London Fix tomorrow. EURO also rallied back after a hard fall overnight; initially triggering stops on a break under the 1.5350 area. Active selling and more stops took the rate down to 1.5284 low print before rallying back to make highs on the day at 1.5442 as late shorts were forced to cover. Forex Traders note that system accounts and model accounts were active on the sell side overnight and most likely they were whipsawed adding to the upside bias for the US session. USD/JPY fell into stops as the 104.50/60 area was unable to hold the recent advance; stops under the 104.00 handle also adding to the pressure as were lower equities. Although equities were firmer in NY today the failure to hold gains was seen as a negative for the rate. Traders also note that USD/JPY has possibly broken the recent uptrend channel; stops are said to be resting under today’s low at the 103.60 area suggesting a long-liquidation break may be in the works. Loonie weakened dramatically and the USD/CAD was higher on the day against the sentiment of the market. Traders may be watching crude and gold prices for clues to the rates near-term direction but the 1.0200 handle is still offering solid resistance; highs at 1.0180 again. On the day, the USD has likely made the highs for the week against some pairs. Look for corrective action overnight as the market prepares for the last piece of news for the week; US balance of Trade Friday morning. forex[/acronym]-technical-analysis/gbp-usd"]GBP/USD Daily Resistance 3: 1.9680 Resistance 2: 1.9650 Resistance 1: 1.9620/30 Latest New York: 1.9526 Support 1: 1.9500 Support 2: 1.9480 Support 3: 1.9450 Comments Rate falls through 1.9650 support area and stops drive trade lower, support at 1.9500 area now in play. Bounce likely from here. Look for continuation of the recovery Friday. Look for a re-test of the 1.9600 area within 24 hours; likely ahead of the London Fix Friday. Close under the 1.9700 handle today likely washed out longs; shorts will cover before the weekend. Bounce back to trade at or near the 1.9720 area by the end of the week suggests a rally is coming. Upside remains limited in my view but ranges can be wide as evidenced by the past few days of trade. Sell rallies if not short; buying dips dangerous. Closes over the MA’s likely not to last so a rally over the 100 bar MA a good sell in my view. Some pressure from EURO remains. Cross-spreading for Yen, Swissy and EURO evident. Data due Friday: All times EASTERN (-5 GMT) forex[/acronym]-technical-analysis/eur-usd"]EUR/USD Daily Resistance 3: 1.5500/10 Resistance 2: 1.5480 Resistance 1: 1.5450 Latest New York: 1.5400 Support 1: 1.5380 Support 2: 1.5350 Support 3: 1.5300/10 Comments Sharp follow-on break is sold by system accounts; likely a bounce is coming. Rally over the 1.5400 handle significant. Rate holds opening range on the fall-back; solid sign of no sellers left. Break under 1.5300 area on stops suggests more losses are coming; bounce likely first. Support at 1.5280 is firm near-term. Look for rotation higher next 24 hours. Rate clears close in stops again. Strong long-liquidation break is still coming; Watch for two-way volatility. Be ready to re-short quickly if a rally happens; look for a short-covering rally to stall around the 1.5550/1.5600 area again; look to re-short in that area. Data due Friday: 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.

Read the Daily Forex Trading Analysis Today’s US Dollar Trading • USD firms, sideways after Housing Data • Pending Home Sales as expected • Speculation BOE might cut rates Thursday Overnight Preview • Look for book-squaring ahead of BOE meeting Looking Ahead to Thursday All times EASTERN (-5 GMT) • 8:30am USD Unemployment Claims forecast 370K • 10:00am USD Wholesale Inventories m/m forecast 0.5% • BOE MPC Rate Announcement no change forecasted Summary The USD has had a strong trading day after another slow start in Asia overnight. Equities softened which kept some pressure on the USD/JPY pair but the Greenback was able to stay on the offensive against most of the pairs throughout the day. Cable broke hard on poor UK data and speculation that a rate cut is coming from the BOE MPC tomorrow; highs at 1.9740 in Asia were never challenged and once the rate broke back through the New York lows form Tuesday stops drove the rate lower until active selling added additional weight. Low prints in early New York at 1.9501 making a show for big stops said to be under the 1.9400 handle but the rate firmed and by afternoon was trading back above the 1.9530 area. USD/CAD tested lows at parity again overnight but was unable to attract additional selling. High prices for gold and oil continue to pressure the rate as the Loonie is seen gaining against the USD while oil remains on the offense. Look for that rate to test the 1.0050/60 area again overnight but to fail as this is previous support area now working as resistance. EURO fell through stops again under the 1.5500 handle overnight and made a show for the support area at 1.5350; low prints at 1.5365 attracted a bit of short-covering but the rate is still weak at the 1.5400 handle. If you are holding shorts in the EURO you have reached a technical objective from the reversal at the 1.6000 handle. It might be wise to lighten up a bit on your shorts and wait for a correction higher to add again. With the BOE meeting tomorrow any “surprises” might rally the pair back to test the 1.5500 handle easily; banking some of the gain might be advisable. In my view the USD has had a great rally to test S/R across the board but today’s data and what is to come still don’t build a case for a strengthening USD long-term. I see today’s strength as a chance to book gains on some positions; aggressive traders can get long the majors short-term if you wish. forex[/acronym]-technical-analysis/gbp-usd"]GBP/USD Daily Resistance 3: 1.99680 Resistance 2: 1.9620/30 Resistance 1: 1.9580 Latest New York: 1.9535 Support 1: 1.9500 Support 2: 1.9480 Support 3: 1.9450 Comments Rate falls through 1.9650 support area and stops drive trade lower, support at 1.9500 area now in play. Bounce likely from here. Look for a re-test of the 1.9600 area within 24 hours; likely after the news Thursday from BOE; failed to rally after the fix today. Close under the 1.9700 handle today likely washed out longs; shorts will cover before the weekend. Bounce back to trade at or near the 1.9720 area by the end of the week suggests a rally is coming. Upside remains limited in my view but ranges can be wide as evidenced by the past few days of trade. Sell rallies if not short; buying dips dangerous. Closes over the MA’s likely not to last so a rally over the 100 bar MA a good sell in my view. Some pressure from EURO remains. Cross-spreading for Yen, Swissy and EURO evident. Data due Thursday: All times EASTERN (-5 GMT) Tentative GBP MPC Rate Statement 7:00am GBP Official Bank Rate 5.00% forex[/acronym]-technical-analysis/eur-usd"]EUR/USD Daily Resistance 3: 1.5580 Resistance 2: 1.5550/60 Resistance 1: 1.5500 Latest New York: 1.5432 Support 1: 1.5400/10 Support 2: 1.5380 Support 3: 1.5350 Comments Two-way action overnight again but break under 1.5450 area on stops suggests more losses are coming; bounce likely first. Support at 1.5365 as expected and the rate rallied hard within 24 hours last time at this number. Look for rotation higher next 24 hours. Rate clears close in stops again and attracts active selling below the 1.5500 handle. Strong long-liquidation break is still coming; test of the lows as expected. Watch for two-way volatility. Be ready to add quickly if a rally happens; look for a short-covering rally to stall around the 1.5550/1.5600 area again; look to re-short in that area; missed it yesterday. Data due Thursday: All times EASTERN (-5 GMT) 2:00am EUR German Trade Balance 16.9B 6:00am EUR German Industrial Production m/m -0.5% 7:45am EUR Minimum Bid Rate 4.00% 8:30am EUR ECB Press Conference 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.

Read the Daily Forex Trading Analysis Today’s US Dollar Trading • USD two sided, ends flat-to-mixed • Reverses early weakness • Traders waiting for tomorrow’s data Overnight Preview • Expect consolidation. • USD likely to range trade on light volumes ahead of data tomorrow Looking Ahead All times EASTERN (-5 GMT) • 9:00 AM CDT Pending Home Sales forecast -0.6%, Look for weak housing data. Summary Aside from some early fireworks on the sell side this morning the USD was relatively subdued for most of New York trade. Starting slowly in Asia overnight as the last day of Golden Week slowed the pace of early action the USD remained two-sided in technical trade until New York got underway. A “stop-fest” in the forex[/acronym]-technical-analysis/usd-cad"]USD/CAD as early USD weakness spilled over into all the pairs; the majors all rallying into resistance with stops the other side for almost everybody creating a near-term break in the Greenback. Loonie sliding under the 1.0050 area and finding lots of action as expected, low prints at .9996 on the second attempt at par. After the lows in USD/JPY and the highs in EURO and GBP all held resistance the USD mounted a turnaround that extended a full handle higher in Swissy and back through the opening ranges in the other pairs. On the day the USD has put in a buying wick in most pairs suggesting that today’s early weakness was only weak shorts. GBP managed a high print at 1.9775 just barely above the 1.9750 pivot area before falling back to trade through the opening range at 1.9725; Cable looks set up for a rotation lower as the EURO also failed and these two are trading in sympathy together. EURO highs at 1.5596 attracted a lot of active offers once the stops were cleared traders say; the rate stays positive on the day but with a long wick at resistance. Across the board the volumes were modest as traders complained of thin conditions due to the various minor holidays this week. With no real news on the boards today the action today is most likely random noise between existing S/R levels; most agree the recent USD strength has a bit more to go before a correction so possibly today was an opportunity to get long from some recent lows. In my view, the USD closed higher than I would like to see for an extended correction and I suggest getting out of USD/JPY shorts and waiting on selling the Greenback until after the news is out tomorrow. Price action is always correct and the drop today needed to stay under pressure if the fire was out of the rally but due to the swift turnaround in thin conditions I think the USD has a bit more to go to the upside yet. forex[/acronym]-technical-analysis/gbp-usd"]GBP/USD? Daily Resistance 3: 1.9820 Resistance 2: 1.9780 Resistance 1: 1.9740/50 Latest New York: 1.9730 Support 1: 1.9650/60 Support 2: 1.9620/30 Support 3: 1.9600 Comments Rate stays two-way all day, closes above the 1.9700 handle, still in the “sell zone” with existing S/R still active. Look for a test of the 1.9600 area within 24 hours; likely after the news Wednesday. Close under the 1.9700 handle again needed to wash out the longs. Bounce back to trade at or near the 1.9720 area into the close suggests a rally is coming. Upside remains limited in my view but ranges can be wide as evidenced by the past few days of trade. Sell rallies if not short; buying dips dangerous. Closes over the MA’s likely not to last so a rally over the 100 bar MA a good sell in my view. Still need down bars with higher volume to confirm; not getting that today. Some pressure from EURO remains. Cross-spreading for Yen, Swissy and EURO evident; look for additional sell-off to end the week. Data due Wednesday: All times EASTERN (-5 GMT) 4:30am GBP Services PMI 51.7 7:01pm GBP Consumer Confidence Index 74 forex[/acronym]-technical-analysis/eur-usd"]EUR/USD Daily Resistance 3: 1.5650 Resistance 2: 1.5590/1.5600 Resistance 1: 1.5550/60 Latest New York: 1.5536 Support 1: 1.5450 Support 2: 1.5400 Support 3: 1.5380 Comments Two-way action all day, weaker close after push to resistance, look for rotation lower tomorrow. Rate clears close in stops both ways again and attracts active selling above the 1.5500 handle. Strong long-liquidation break is still coming; test of the lows as expected. Watch for two-way volatility. Be ready to add quickly if a rally happens; close under the 50 bar MA could attract active selling. Continue to hold shorts and look for a short-covering rally to stall around the 1.5550/1.5600 area; look to add to open shorts in that area; missed it today unless actively watching. Data due Wednesday: All times EASTERN (-5 GMT) 3:30am EUR ECB President Trichet Speaks 4:00am EUR Services PMI 51.8 5:00am EUR PPI m/m 0.6% 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.

Forex Analysis Today’s US Dollar Trading • Major pairs two-way, end stronger • Volumes light due to minor holidays • USD ends near lows Overnight Preview • Look for more two-way and consolidation trade Looking Ahead All times EASTERN (-5 GMT) • None in the US, very light start to the week; housing data Wednesday likely to carry more weight. Summary A very quiet two-way session left the USD slightly lower from Friday’s closing levels against the forex trading majors; traders note that the holiday thinned conditions contributed to the lack of interest either way. On the day, after what would have been the London fix, the USD fell into some active selling as the rate cleared below initial opening levels seen in Asia; traders suggesting that model and momentum accounts were liquidating late long positions when the USD saw no follow-through after the initial push higher on the day seen around the release of the ISM Services numbers this morning. Coming out a bit better than forecast the USD rallied on the news but was unable to hold gains and quickly fell back to test lows. EURO was able to clear above the 1.5500 handle for a high print in late trade at 1.5520 recovering a full handle off the 1.5422 low print; traders say there was no real reason for the move other than short-covering and that was likely exacerbated by the thin conditions. Cable initially broke to fresh lows at 1.9653 but then began a slow-steady march until reaching the opening range before popping higher on technical trade; closing above the 1.9700 handle leaves a “doji” point of indecision today suggesting the rate is poised to rotate higher near-term. If short the GBP; I would cover and re-set shorts after the rally that seems sure to happen overnight. USD/JPY tried again for the 105.60/80 area with a post-news high print at 105.63 but was again turned back; even with Japan closed today exporters were no doubt on the offer. The rate fell into support at the 105.10/20 area for most of the day before falling to pressure seen in other rates; low prints at 104.72 continue to support the 104.80 area but traders feel confident the stops seen under the 105.00 are only the early longs getting out. Traders feel bids extend to 104.50 area with large stops likely in the 104.30/40 area; look out below if those trigger this week as a technical top would form in the USD. Swissy and Loonie both lower as well with Loonie holding above the 1.0100 handle again despite good offers all the way down to the lows at 101.18; most likely stops are under the 1.0100 area. Swissy is well off the overnight highs of 1.0598 making lows in New York at 1.0509 and closing near the lows. In my view, the USD is off to a defensive start and if you are holding shorts from last week look to add on any strength; it’s my view the Greenback is headed for support by the end of the week. GBP/USD Daily Resistance 3: 1.9820 Resistance 2: 1.9780 Resistance 1: 1.9740/50 Latest New York: 1.9722 Support 1: 1.9650/60 Support 2: 1.9600 Support 3: 1.9550 Comments Rate drops under the 1.9700 handle to start, look for a test of the 1.9600 area within 24 hours. Close under the 1.9700 handle again needed to wash out the longs. Bounce back to trade at or near the 1.9720 area into the close suggests a rally is coming. Upside remains limited in my view but ranges can be wide as evidenced by the past few days of trade. Sell rallies if not short; buying dips dangerous. Drop to under the MA’s very important, long selling wick makes sell side attractive for further losses. Need down bars with higher volume to confirm; not getting that today. Some pressure from EURO remains. Cross-spreading for Yen, Swissy and EURO evident; look for additional sell-off to end the week. NFP today increased volatility and negative close is great for follow-through Monday Data due Tuesday: All times EASTERN (-5 GMT) 4:30am Services PMI 51.7 7:01pm Consumer Confidence Index 74 EUR/USD Daily Resistance 3: 1.5600/10 Resistance 2: 1.5550/60 Resistance 1: 1.5520 Latest New York: 1.5492 Support 1: 1.5400/10 Support 2: 1.5350/60 Support 3: 1.5300 Comments Additional selling to new low early, Rate clears stops again and attracts active selling after 1.5400 area falls; Strong long-liquidation break is still coming; test of the lows as expected. Watch for two-way volatility. Be ready to add quickly if a rally happens; close under the 50 bar MA could attract active selling. Continue to hold shorts and look for a short-covering rally to stall around the 1.5550/1.5600 area; look to add to open shorts in that area. Data due Tuesday: All times EASTERN (-5 GMT) 4:00am Services PMI ® 51.8 5:00am PPI m/m 0.6% In association with Forex Trading Edge 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.

Forex Trading Daily Analysis Overnight Asia/Europe • USD very quiet • Holidays in Asia and UK Today’s Economic Reports All times EASTERN (-5 GMT) • 10:00am USD ISM Non-Manufacturing Composite forecast 49.6 Looking Ahead All times EASTERN (-5 GMT) • None in the US , Very light start to the week; housing data Wednesday likely to carry more weight. Summary The USD is trading sideways to slightly lower to start New York after a very quiet overnight start to the week. Asian trade was very subdued with Japan, Korea and Thailand market centers closed; traders noted good demand for USD/JPY from a UK momentum fund as well as order driven trade in EURO. With the UK closed also for a minor holiday European trade was also on the quiet side; traders note that volumes were very light and trade remained technical in nature. For the most part the USD remained within a few pips either way of the Friday New York close; cable saw downside pressure from light selling around the 1.9720 area and more in sympathy from a weaker EURO. High prints in Cable at 1.9786 were a few pips shy of the 100 day MA suggesting that larger offers are willing to sell rallies despite the thinner conditions. Stops elected under the 1.9700 area gave GBP one more push lower ahead of the NY open for a low print at 1.9660; traders expect a slight bounce from this support area and today’s ISM services may provide the impetus. EURO is a bit better than Friday’s close but still trading two-way and respecting the 1.5500 area of current resistance. Forex Traders note no real market-moving news but mention the cross-spreaders for Yen and Sterling have been active on the Buy side overnight. EURO not expected to extend gains today and rallies are seen as a selling opportunity. USD/JPY continues to hold the 105.00 handle in light trade with the lack of follow-through buying a concern for the bulls. In my view, the fact that momentum accounts were on the buy side of USD to start the week is a great clue the rate is about to reverse; aggressive traders can sell USD/JPY over the 105.20 area if not short already. Swissy and Loonie are also slightly lower but still within established ranges from last week. Looking for a solid break in both pairs this week so any strength will likely be a selling opportunity. After ISM this morning look for the markets to have a brief “Knee-Jerk” reaction to the news and then settle back to pre-report numbers. Without real news in the US until Wednesday and the holidays overseas today should remain fairly quiet without major action. GBP/USD Daily Resistance 3: 1.9820 Resistance 2: 1.9780 Resistance 1: 1.9720 Latest New York: 1.9684 Support 1: 1.9650/60 Support 2: 1.9600 Support 3: 1.9550 Comments Rate drops under the 1.9700 handle to start, look for a test of the 1.9600 area within 24 hours. Close under the 1.9700 handle again needed to wash out the longs. Upside remains limited in my view but ranges can be wide as evidenced by the past few days of trade. Sell rallies if not short; buying dips dangerous. Drop to under the MA’s very important, long selling wick makes sell side attractive for further losses. Need down bars with higher volume to confirm. Some pressure from EURO remains. Cross-spreading for Yen, Swissy and EURO evident; look for additional sell-off to end the week. NFP today increased volatility and negative close is great for follow-through Monday Data due Tuesday: All times EASTERN (-5 GMT) 4:30am Services PMI 51.7 7:01pm Consumer Confidence Index 74 EUR/USD Daily Resistance 3: 1.5600/10 Resistance 2: 1.5550/60 Resistance 1: 1.5500 Latest New York: 1.5453 Support 1: 1.5400/10 Support 2: 1.5350/60 Support 3: 1.5300 Comments Additional selling to new low early, Rate clears stops again and attracts active selling after 1.5400 area falls; bounce sure to happen soon but upside likely limited to 1.5520/30 area. Look to sell a bounce during the next 48 hours. Strong long-liquidation break is still coming; test of the lows as expected. Watch for two-way volatility. Be ready to add quickly if a rally happens; close under the 50 bar MA could attract active selling. Data due Tuesday: All times EASTERN (-5 GMT) 4:00am Services PMI ® 51.8 5:00am PPI m/m 0.6% 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.

Daily Forex Analysis Today’s USD Trading • USD weakens in Asia, goes two-way in Europe • Asia and Europe minor holidays, volumes light • USD rallies hard in NY trade, US data neutral Overnight Preview • Expect a book-squaring session • Not a lot left to drive the greenback Looking Ahead All times EASTERN (-5 GMT) • 8:30am Nonfarm Employment forecast -80K • 8:30am Unemployment Rate forecast 5.2% • 8:30am Average Hourly Earnings m/m forecast 0.3% • 10:00am Factory Orders m/m forecast 0.2% Summary The USD roared back today from a disappointing set of data this morning and recovered a lot of lost ground against most of the pairs. USD/CHF rallied the most hitting stops said to be resting above the 104.50/60 area for a high print at 1.0511 before falling back a bit. Traders note that today’s slew of minor US data had no real market moving information to it but a general tone of USD recovery helped underpin the Greenback for most of the day; higher equities also underpinned along with cheaper oil. GBP fell back from a European high print at 1.9912 to find the usual volatility seen of late; lows after the London fix at 1.9710 again making for huge whipsaw. Traders who are holding GBP shorts can rest easy overnight as the rate is trading under the 100 bar MA today and as long as it remains under the “sell zone” at 1.9750 area a test of the 1.9600 handle is likely. EURO also had a down day falling through several layers of stops; traders note that the big stops rumored to be at 1.5520 area actually were a bit lower at 1.5480/90 area and the rate accelerated for a low print in NY at 1.5429. Traders now believe the EURO is headed under the 1.5400 handle for a test of the first fib defense around the 1.5350 area; in my view the next rally needs to be sold aggressively as the lead we have on the trade is getting quite large. Aggressive traders can roll stops down to the 1.5650 area also. USD/JPY was trading under the 104.20 area most of the day until equities rallied above gains of 125 points and then broke out for a try at heavy offers at 104.80 area; high prints shy of there at 104.60 and the offers were thick traders say. Aggressive traders holding shorts can look to add on a close under the lows today at 103.53. USD/CAD rallied along with Swissy and scored the 1.0200 handle for a high print at 1.0240 before dropping back to close under the 1.0180 area. I hate getting stopped out but the numbers are still valid for holding shorts in my view; we will look for that tomorrow. All in all today’s as-expected ISM fell to the back seat as USD one-way volatility took everyone by surprise; look for a bout of book-squaring overnight and a lower end to the week after NFP tomorrow; NFP likely to come in on the low side so expect whipsaw in the AM. GBP/USD Resistance 3: 1.9850/60 Resistance 2: 1.9820/30 Resistance 1: 1.9780 Latest New York: 1.9740 Support 1: 1.9700/10 Support 2: 1.9650 Support 3: 1.9600/10 Comments Rally back from “sell zone 1.9730/50 area” clears weak shorts. major stops likely under the 1.9600 handle; above 1.9900 rejected soundly; fall back to the “sell zone” at 1.9720/50 significant. Close under the 1.9700 handle again needed to wash out the longs. Upside remains limited in my view but ranges can be wide as evidenced by the past few days of trade. Sell rallies if not short; buying dips dangerous. Drop to under the MA’s very important, long selling wick makes sell side attractive for further losses. Need down bars with higher volume to confirm. Overnight data unfriendly with more to come, Some pressure from EURO also. Cross-spreading for Yen, Swissy and EURO evident; look for additional sell-off to end the week. Data due Friday: All times EASTERN (-5 GMT) 4:30am Construction PMI forecast 47.0 EUR/USD Resistance 3: 1.5700/10 Resistance 2: 1.5680 Resistance 1: 1.5650 Latest New York: 1.5615 Support 1: 1.5590/1.5600 Support 2: 1.5540/50 Support 3: 1.5520 Comments Rate clears stops and attracts aggressive selling after 1.5490 area falls; drop to 1.5420 area likely to draw a bounce but upside likely limited to 1.5520/30 area. Look to sell a bounce. Two-way trade at resistance Thursday in Europe (1.5650 area) suggests rate has limited upside. Deeper pullback still in the works. Strong long-liquidation break is still coming; test of the lows as expected by end of the week. Watch for two-way volatility. Be ready to add quickly if a rally happens; close under the 50 bar MA could attract active selling. Data due Friday: All times EASTERN (-5 GMT) 4:00am Manufacturing PMI ® forecast 50.8 In association with Forex Trading Edge 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.

Daily Forex Analysis Today’s USD Trading • USD quiet in Asia, firms in Europe • GBP and EURO rally after rate cut • Whipsaw in the majors Today’s Economic Reports All times EASTERN (-5 GMT) • 8:15am ADP Private Payrolls, Actual+ 10,000 • 8:30am Advance GDP q/q 0.2%0.6%, Actual +0.6, -0.2% • 8:30am Advance GDP Price Index q/q 3.0%2.6% • 8:30am DECI q/q 0.8%0.8% • 9:45am Chicago PMI 47.548.2 Actual 48.3 • 2:15pm FOMC, actual 25 BP cut Looking Ahead to Thursday All times EASTERN (-5 GMT) • 7:30am Challenger Job Cuts y/y 9.4% • 8:30am Personal Spending m/m 0.2%0.1% • 8:30am Core PCE Price Index m/m 0.1%0.1% • 8:30am Unemployment Claims 363K342K • 8:30am Personal Income m/m 0.4%0.5% • 10:00am ISM Manufacturing Index 48.048.6 • 10:00am ISM Manufacturing Prices 83.583.5 • 10:00am Construction Spending m/m -0.8%-0.3% USD two-way again, GBP rallies back, Fed cuts As expected the FOMC cut interest rates 25 BP today and changed the wording of the statement suggesting that the Fed is taking a more neutral course in the coming months. Analysts are debating that the Fed would like to see the effect of both the new liquidity windows and the government rebate-stimulus package before weighing in on further rate cuts. The Fed made clear that it is still considering the inflation pressures seen recently and the bottom line to the rate cut is a “wait and see” attitude. In response the USD whipsawed trader’s on the news; initially rising against some pairs and then getting slammed later. Forex Traders note that the rally in GBP as well as EURO are “knee jerk” responses to trade volatility and don’t expect a serious change in trend; most agree the USD “squeezed” weak longs initially. For the record, the GBP rallied on news starting this morning as other US news was not USD friendly but popped higher on stops and short-covering above the 1.9800 handle for a high print at 1.9897 before finding offers at technical resistance around the recent developing down trend. Traders note that cable has been exceptionally volatile the past several weeks and today was no exception; if the rate follows suit the next 24 hours we should see a return to the 1.9600 handle by the end of the week. EURO rallied initially on the news for a high print at 1.5645 and looks set to continue higher but offers in the 1.5650 area and 1.5680 area are said to be getting thicker so this rally off the lows may be a dead-cat bounce. Look for a lack of follow-through overnight. USD/JPY broke under the 104.00 handle in heavy trade for a low print at the 103.68 number at last look; traders note that the rate has had good selling from CTA types and exporters around the 104.60/80 area this morning. USD/CAD and Swissy also taking their lumps but not nearly as aggressively as other pairs; OK to hold open shorts across the board and let the overnight action work for us. Tomorrow is a light day for news so expect a rotation in the USD; especially against GBP. GBP/USD Resistance 3: 1.9950 Resistance 2: 1.9900/10 Resistance 1: 1.9820/30 Latest New York: 1.9883 Support 1: 1.9820/30 Support 2: 1.9780 Support 3: 1.9750 Other Things to Watch/Open Trades/News 4-30-08 SELL GBP/USD 1.9820 OB Stops@ 1.9920 (Should be short from this afternoon) Whipsaw still evident, selling into the top of the trend line and volatility. Comments Rate under 1.9720 area important but rally back clears weak shorts. major stops likely under the 1.9600 handle; likely to be challenged soon but given conditions a bounce is coming first (which happened after FOMC) Upside remains limited in my view but ranges can be wide as evidenced by the past few days of trade. Sell rallies if not short; buying dips dangerous in my view. Drop to under the MA’s very important, long selling wick makes sell side attractive for further losses. Need down bars with higher volume to confirm. Overnight data unfriendly with more to come, Some pressure from EURO also. Rate attracting bids from momentum players so look for stops close-in overnight. Data due Thursday: All times EASTERN (-5 GMT) 2:00am GBP Nationwide House Prices m/m -0.5%-0.6% EUR/USD Resistance 3: 1.5700/10 Resistance 2: 1.5680 Resistance 1: 1.5650 Latest New York: 1.5615 Support 1: 1.5580 Support 2: 1.5540/50 Support 3: 1.5520 Other Things to Watch/Open Trades/News 4-22-08 SHORT EURO/USD 1.6000 Stops @ 1.5750 4-24-08 SHORT EURO/USD 1.5650 Stops @ 1.5750 ROLL Stops to 1.5750 on entire position; look to add to shorts again later today. Close under the 1.5550 area sets up a test of stops. Comments Market has failed at 1.6000 area resistance with confidence now, be patient on the potential break. Overhead resistance is heavy above the 1.5750 area now with 1.5660 first; traders say offers extend into the 1.5800/30 area with stops above. Two-way trade at resistance to start on Monday suggests a deeper pullback is in the works. Strong long-liquidation break is still coming; test of the lows as expected Wednesday. Watch for two-way volatility. Be ready to add quickly if a rally happens; rate has BIG stops under the 1.5520 area and a break under the 50 bar MA could be swift. Rally after FOMC is a “head fake”; look for retreat within 24 hours. Data due Thursday: All times EASTERN (-5 GMT) All Day EUR Holiday: Labour Day 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.

Daily Forex Analysis Today’s USD Trading USD ends mixed GBP falls through support Today’s Economic Reports Consumer Confidence out at 62.3 Looking Ahead All times EASTERN (-5 GMT) 8:15am USD ADP Nonfarm Employment Change -60K 8K 8:30am USD Advance GDP q/q 0.2% 0.6% 10:45am USD Chicago PMI 47.5 48.2 2:15pm USD FOMC Statement 2:15pm USD Federal Funds Rate 2.00% 2.25% USD mixed, GBP and EURO fall through support Actually a very unexpected day for the GBP and the EURO as the USD ends a mixed session sharply higher against the Europeans and mixed against everyone else. BOE Blanchflower was making dovish remarks this afternoon and the GBP extended losses from the London fix to make lows under the 1.9700 handle later in the day; the lack of volume from the Far East today likely contributed to the run on the stops as bids were simply not there. A new weekly low and a press for bids under the 1,9680 area left a low print at 1.9665; good enough to wreck a few balance sheets. EURO pressed into stops as well as the potential for correction continues; low prints at 1.5539 in early US trade were untouched for the end of the day and EURO rallied on dip buying but not enough to discourage the bears. Low prints under the 1.5520 area expected tomorrow after the FOMC meeting I think. Other pairs remained fairly range-bound; no real action either way with the exception of USD/JPY. Many forex traders get so absorbed in trying to find the “best” entry point that they completely lose focus on the really important things.The most significant thing to always remember is that price action needs to be exploited from the point of view that you need to buy low and sell high in order to profit.It doesn’t matter if you are shorting the market or going long—you ALWAYS must have a buy execution lower than your sell. Anything else is a loss. Therefore, you must always be selling strength; whether or not you are covering a long or going short. Same for the other way around. It doesn’t matter if you are covering a short or going long; you must buy weakness. In the final analysis, your trading results are determined by your willingness to buy when everyone else is selling…and buy when everyone else is selling. Don’t look for the perfect place to enter. Rather look for a buy zone after a break and vice-versa. Actually a very unexpected day for the GBP and the EURO as the USD ends a mixed session sharply higher against the Europeans and mixed against everyone else. BOE Blanchflower was making dovish remarks this afternoon and the GBP extended losses from the London fix to make lows under the 1.9700 handle later in the day; the lack of volume from the Far East today likely contributed to the run on the stops as bids were simply not there. A new weekly low and a press for bids under the 1,9680 area left a low print at 1.9665; good enough to wreck a few balance sheets. EURO pressed into stops as well as the potential for correction continues; low prints at 1.5539 in early US trade were untouched for the end of the day and EURO rallied on dip buying but not enough to discourage the bears. Low prints under the 1.5520 area expected tomorrow after the FOMC meeting I think. Other pairs remained fairly range-bound; no real action either way with the exception of USD/JPY. The rate found stops under the 103.50 area for a low print at the 103.21 number before rallying hard to re-gain the 104.00 handle; sympathy buys along with equities as well as cross-spreading likely lifted the pair. Looking ahead to US data tomorrow you can expect a volatile day in my view. First up is ADP private payrolls which have added a lot of two-way action. Next is GDP and last is FOMC—all things considered tomorrow is the day to set the tone for the rest of the week. Look for the Greenback to be quiet overnight. GBP/USD Daily Resistance 3: 1.9820 Resistance 2: 1.9750 Resistance 1: 1.9720/30 Latest New York: 1.9683 Support 1: 1.9650/60 Support 2: 1.9600 Support 3: 1.9550 Other Things to Watch/Open Trades/News Currently flat—stopped out of short yesterday. Rate has strong buy signal but top is at resistance; possible “late” conflicting signal. Rate under 1.9720 area important, major stops likely under the 1.9600 handle; likely to be challenged soon but given conditions a bounce is coming first. Closing under the 1.9600 the next 24 hours likely set the stage for a return to 2008 lows near-term. Upside is limited in my view but ranges can be wide as evidenced by the past few days of trade. Sell rallies if not short; buying dips dangerous in my view. Drop to under the MA’s very important in my view. Long selling wick makes sell side attractive for further losses. Need down bars with higher volume to confirm Overnight data unfriendly with more to come, Some pressure from EURO also. Data due Wednesday All times EASTERN (-5 GMT) Tentative GBP Nationwide House Prices m/m -0.5% -0.6% EURO/USD Daily Resistance 3: 1.5680 Resistance 2: 1.5650/60 Resistance 1: 1.5600/10 Latest New York: 1.5565 Support 1: 1.5630/40 Support 2: 1.5600/10 Support 3: 1.5480 Other Things to Watch/Open Trades/News 4-22-08 SHORT EURO/USD 1.6000 Stops @ 1.6100 4-24-08 SHORT EURO/USD 1.5650 Stops @ 1.5750 Look to add to shorts again soon. Comments Market has failed at 1.6000 area resistance with confidence now, be patient on the potential break. Overhead resistance is heavy above the 1.5750 area; traders say offers extend into the 1.5800/30 area with stops above. Two-way trade at resistance to start on Monday suggests a deeper pullback is in the works. Strong long-liquidation break is still coming; look for a test of the lows again within 24 hours. Watch for two-way volatility. Be ready to add quickly if a rally happens. Data due Wednesday All times EASTERN (-5 GMT) Forecast Last 3:55am EUR German Unemployment Rate 7.8% 7.8% 5:00am EUR CPI Flash Estimate y/y 3.4% 3.5% 5:00am EUR Consumer Confidence -13 -12 USD/JPY Daily Resistance 3: 105.00 Resistance 2: 104.80 Resistance 1: 104.20/30 Latest New York: 104.00 Support 1: 103.50/60 Support 2: 103.20/30 Support 3: 103.00 Other Things to Watch/Open Trades/News Still Flat but aggressive traders can sell on a test of the 105.00 area; Looking at the sell side early this week. USD/CHF Resistance 3: 1.0450 Resistance 2: 1.0420 Resistance 1: 1.0380 Latest New York: 1.0373 Support 1: 1.0320/30 Support 2: 1.0300 Support 3: 1.0270/80 Other Things to Watch/Open Trades/News SHORT USD/CHF 1.0380 Stops @ 1.0480 Aggressive traders can sell 103.70/80 area and hold over the weekend (Higher risk so trade accordingly) Comments Rate clears stops above near-term resistance. Rate now at very top of range; look for a sell-off from here but news is needed. Pullback was bought after the fix on Friday and the rate is firm now for a test of the 104.30/40 area again. Test of the lower range now expected if rate can fail again at resistance. Expect a bounce from 1.0250 now so be nimble though as a break below there likely to draw aggressive selling. Rate has set up to attract dip buying so we need to see if that is a head-fake. Need a failure at 1.0420 near-term to go short in my view. No follow-through is to be respected; look for offers to show up higher than the1.0400 handle now that the bounce followed through higher. Data due Wednesday All times EASTERN (-5 GMT) 5:30am CHF Leading Index m/m 1.46 1.54 USD/CAD Resistance 3: 1.0220 Resistance 2: 1.0180 Resistance 1: 1.0130 Latest New York: 1.0109 Support 1: 1.0100 Support 2: 1.0080 Support 3: 1.0050 Other Things to Watch/Open Trades/News SHORT USD/CAD 1.0130 Stops @ 1.0230 Failure to close above the 101.80 area suggests the rate has a failed rally (top of range). ON THE LOWS TO END NEW YORK 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.

For More Forex Analysis Overnight Asia/Europe • Greenback starts firm then falls in Europe • Lots of rhetoric from Europe • Technical trade dominates Today’s Economic Reports • None in the US Summary The USD is slightly weaker this morning after a quiet start in Asia last night; traders note that firmer equities in Asia had no impact on USD/JPY this time and most feel that the market is sidelined ahead of FOMC rate announcements on Wednesday. Desks report some early demand for USD/JPY but once the European markets opened the demand fizzled; high prints in USD/JPY at 104.83 after a slow start. Exporters are noted to be ready on the offer at 105.00 with stops resting above traders say. GBP had a slow start as well but follow-through bids from Friday lifted the rate into early stops at the 1.9850/60 area and a high print in Europe at 1.9913 before dropping back when selling emerged in the EURO-Sterling cross; lows in Asia currently unchallenged at 1.9780 in early NY trade. Lots of rhetoric out during European trade and some data; traders note that the EURO seems heavy at the highs after the release of CPI data but the rate is still firmer on the day; high prints at 1.5694 with lows at 1.5592 making for some volatile trade early. ECB Mersch had no comment on the report but did emphasize that the bank is still concerned with upside risks to inflation; traders note that the market is braced for no ECB rate cut until at least Q4 2008 but note that dips are bought at key technical levels suggesting that at least for the near term the EURO will remain more two way even in a correction. Traders holding open shorts in EURO and GBP can sit tight for now as it appears that the technical S/R levels will contain dips and rallies; stops on the other side of those levels likely to be growing in size as the forex trading market is looking for a decisive move by the Fed with more rate cuts to come; if that is not the impression the markets get on Wednesday then the USD may rally hard against the European currencies. Other major pairs remain range-bound and technical in nature this morning; USD/CAD has had a volatile morning so far and buying dips seem to be the favored move to start the week. Look for the Greenback to consolidate today and into tomorrow; it’s a light calendar until then. Aggressive traders can trade from both sides as the USD is likely to cover a lot of the same ground twice. GBP/USD Resistance 3: 1.9980/90 Resistance 2: 1.9950/60 Resistance 1: 1.9910/20 Latest New York: 1.9883 Support 1: 1.9750 Support 2: 1.9690/1.9700 Support 3: 1.9650 Comments Rate bounces nicely on lighter volume, should be a “dead cat bounce” Closing under the 1.9800 the next 24 hours likely set the stage for a return to lower prices early in the week. Upside is limited in my view but ranges can be wide as evidenced by the past 72 hours of trade. Sell rallies if not short; buying dips dangerous in my view. Drop to under the MA’s very important in my view. Long selling wick makes sell side attractive for further losses. Need down bars with higher volume to confirm. EURO/USD Daily Resistance 3: 1.5750 Resistance 2: 1.5720/1.5730 Resistance 1: 1.5690/1.5700 Latest New York: 1.5633 Support 1: 1.5590/1.5600 Support 2: 1.5550 Support 3: 1.5520 Comments Market has failed at 1.6000 area resistance with confidence now, be patient on the potential break. Overhead resistance is heavy above the 1.5750 area; traders say offers extend into the 1.5800/30 area with stops above. Two-way trade at resistance to start on Monday suggests a deeper pullback is in the works. Strong long-liquidation break is still coming; look for a test of the lows again within 24 hours. Watch for two-way volatility. Be ready to add quickly if a rally happens; likely to fail quickly. Today a close back under the 1.5600 handle very important; look for a test of the 1.5550 area early this week, offers likely on a rally to 1.5700 area. 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.

Forex Daily Analysis Overnight Asia/Europe • USD firmer to mixed • EURO extends losses • GBP bounces Today’s Economic Reports • UK GDP +2.5 y/y, lowest in 3 years • 9:00 AM CDT Consumer Sentiment forecast 63.3 Looking Ahead • Too much to list! Main US releases are GDP and FOMC Wednesday, ISM Thursday and NFP on Friday Summary The USD is two-way and mixed to start New York; overnight action was muted ahead of the weekend. In Asia the USD had narrow ranges with the release of higher-than-expected Tokyo CPI data having no effect on the Greenback; higher equities also had little impact. Traders note that the USD/JPY had attracted a lot of large names yesterday and today’s action appears to be consolidative despite the rate posting a new weekly high overnight Europe at 104.83 last night. USD/JPY is trading in lower volume ahead of US data due for release today and most desks suggest the USD may have run its’ course for the week. EURO is again weaker building on heavy losses from yesterday; low prints at 1.5554 found technical support but the rate has broken down through the 1.5600 handle with authority and more losses are expected near term. Ahead of the weekend traders expect a short-covering rally as shorts cover ahead of the weekend but so far no sign of bid interest being there in size. GBP is higher as cross-traders liquidate EURO-Sterling crosses; highs in GBP at 1.9887 were enough to trigger our shorts again. Volumes modest and lower GDP numbers released in the UK did little to dampen the mood of the bulls. Swissy is opening New York higher on follow-on buying; high prints in USD/CHF at 1.0433 driven by stops and technical factors. The rate is above previous trend line resistance and stops said to be cleared in size leaving the rate vulnerable to a pullback. In my view, the USD has had an important technical week. With the FOMC meeting next week the market seems to be signaling that the Fed is done with the rate cut cycle. I think it is still premature for the USD to make a sustained turnaround and I think this rally needs to be seen in context of things are not improving yet. Look for the USD to pullback from these gains next week; I think we are still a ways away from a firm USD recovery. Additionally, other major central banks are still holding rates firmer than the US which I think has a longer-time frame impact and will continue to pressure USD near-term. Changing the bearish sentiment will take more than a three-week rally in my view. GBP/USD Daily Resistance 3: 1.99950 Resistance 2: 1.99920 Resistance 1: 1.9880 Latest New York: 1.9832 Support 1: 1.9800 Support 2: 1.9750 Support 3: 1.9700 Comments Rate bounces nicely on lighter volume, should be a “dead cat bounce” Closing under the 1.9800 handle yesterday likely set the stage for a return to lower prices early next week. Upside is limited in my view but ranges can be wide as evidenced by the past 72 hours of trade. Sell rallies if not short; buying dips dangerous in my view. Look for the London fix to see long-liquidation as the pair continues to flirt with the long-term MA’s which are still bearish in my view; looking for a close under the 100 bar MA today which would be roughly the 1.9820 area. EURO/USD Daily Resistance 3: 1.5720/30 Resistance 2: 1.5690/1.5700 Resistance 1: 1.5640/50 Latest New York: 1.5593 Support 1: 1.5550 Support 2: 1.5520 Support 3: 1.5500 Comments Market has failed at 1.6000 area resistance with confidence now, be patient on the potential break. Overhead resistance is heavy above the 1.5750 area; traders say offers extend into the 1.5800/30 area with stops above. Strong long-liquidation break is still coming; look for a test of the lows again within 24 hours. Watch for two-way volatility. Be ready to add quickly if a rally happens; likely to fail quickly. Keep working the add order on a reasonable bounce. 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.

Daily Analysis Today’s US Dollar Trading • USD mixed • EURO fails at highs Overnight Preview • Look for more booksquaring • Quiet ahead of US data in the morning Looking Ahead • 7:30 AM CDT Durable Goods forecast +0.1% • 9:00 AM CDT New Home Sales forecast 490K Summary The USD is mixed to end New York today after a correction overnight driven by rhetoric and stops. Traders note that the Greenback traded two-sided in Asia vesting both sides of the New York close and volumes were light suggesting that technical trade was dominate. Once the European session opened the USD began to climb a bit led by a drop in EURO as enthusiasm for an ECB rate hike faded. German manufacturing data was on the lighter side and the failure of the EURO to score another high after the psychological 1.60 handle traded yesterday added to a bout of profit-taking by nervous longs. Opening lower in NY the EURO ran for lows and printed at 1.5860 during the day; a close under the 1.5900 handle appears to have solidified the bears argument that a correction is in the works. Aggressive forex trader can add to shorts on a close under the 1.5880 area. Cable rotated lower for a low print at 1.9771 and found stops all the way down layered 1.9880, 1.9850, 1.9820 and 1.9800 but support ahead of the 1.9750 area suggests that the rate will bounce; look to sell a 1.9880 area bounce in my view. MPC minutes showed a split vote at the last meeting and the doves are not agreed moving forward; seen as mildly bullish the rate was unable to hold and remained under pressure all day. USD/JPY had a brief bout of short-covering and a rally to 103.50 area but as expected the rate found offers on the approach and fell back for lows at 102.74 before bouncing again for a short-squeeze to 103.80 area; close around 103.50 suggests the top of the range. In my view, the USD has had a low-volume rally that has kept prices within established ranges. I would look to sell the rally and expect a break lower on US data due out tomorrow. Look for poor housing to push the Greenback tomorrow but tonight expect a quiet overnight session. 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.

Daily Forex Analysis Overnight Asia and Europe • USD two-sided and consolidates • No real market moving news Today’s Economic Reports • None in the US today Majors open New York mixed The USD is trading sideways in a reasonable pattern of consolidation this morning after a quiet two-way overnight session. No real market moving news was on tap and the majors are both sides of yesterday’s New York close. Currently at the start of New York trade the majors are mixed as light volumes and technical trade start the day. The USD is higher against the GBP; overnight highs on light volume were 1.9976 and after the release of BOE MPC minutes the rate sold off for a low print at 1.9866 on better volume. Traders say the split vote was seen as bearish and sentiment continues to be neutral to bearish long term; cross spreading for EURO continues to increase volatility some say. EURO fell back from the all-time high yesterday as traders remain cautious ahead of US data due tomorrow. Desks report thin order books but also a Swiss private bank on the bid around the 1.5960 area; highs overnight at 1.6002 with low prints at 1.5939 during European trade. Stops are likely building under the 1.5920 area and aggressive traders can look to add to shorts on a break into the 1.5800 handle; a close under the 1.5880 area argues for a deeper pullback in my view. USD/JPY is on the defense this morning as no bids were seen in Asia for a high print at 103.34 before offers took over; low prints just ahead of New York at 102.74 making the day an inside range day so far. Forex Traders note that tensions with China ahead of the Olympics and trade talks with the Eurozone are making trade “nervous” which often is seen as USD bullish; potential will likely keep USD/JPY two-way and within established ranges making for good opportunity on the short time-frames. Swissy is also locked inside range today with very little action; traders expect support at the bottom of the range near-term. In my view, today will likely remain a consolidation day with the GBP sliding around for the most part; I don’t think the EURO has another high in mind this week and I think the USD will remain range-bound through the data tomorrow. Look for data to be USD neutral-to-bearish on Thursday and for the weeks’ range to extend to the downside for the Greenback during Thursday. GBP/USD Resistance 3: 1.9980/2.0000 Resistance 2: 1.9940/50 Resistance 1: 1.9900 Latest New York: 1.9845 Support 1: 1.9820/30 Support 2: 1.9800 Support 3: 1.99750 Rally yesterday was indeed a head-fake so far this next 24 hours. Offers are thick ahead of the 1.9980/2.0000 area again, stops said to be under the 1.9850 and 1.9820 areas today. Comments Rate back below the 1.9900 handle on the day; look for continued pressure back to the support zone around the 1.9750 area. Stops likely to drive trade lower today and rate is making lows in early New York action. Close below the 1.9800 handle opens the door for a test of the 1.9700 handle. Upside is limited in my view but ranges can be wide as evidenced by the past 48 hours of trade. Sell rallies if not short; buying dips dangerous in my view. Aggressive traders can sell over the 1.9880 area during the day. EUR/USD Resistance 3: 1.6020/30 Resistance 2: 1.6000 Resistance 1: 1.5980 Latest New York: 1.5940 Support 1: 1.5920/30 Support 2: 1.5900 Support 3: 1.5880 Rhetoric from ECB to remain hawkish, Wednesday German manufacturing news, Thursday IFO. 4-22-08 SHORT EURO/USD 1.6000 Stops @ 1.6100 Hold and look to add on a close below 1.5900 area Comments Market is failing at resistance, be patient on the potential break Overhead resistance is heavy above the 1.5980 area; traders say offers extend into the 1.6000/30 area with stops above. Looking for a “first through the even” scenario; a strong long-liquidation break is coming and aggressive traders can look to sell into a sharp rise. Sell zones today are 1.5980, 1.6000, 1.6020; buy zones 1.5850, 1.5830, 1.5800 Watch for two-way volatility; expect a sell signal on the hourly charts. Hook reversal still valid. Be ready to add quickly if this rally fails. USD/JPY Resistance 3: 104.00/10 Resistance 2: 103.80 Resistance 1: 103.50/60 Latest New York: 103.05 Support 1: 102.70 Support 2: 102.40/50 Support 3: 102.20 Yuan still marching higher taking the Yen with it. 04-21-08 SHORT USD/JPY 103.60/80 Stops @ 104.80 Look to ADD Wednesday/Thursday on a close under the 102.50 area. Comments Drop under the 103.00 area still labored as conditions are thin. Traders note that the market is still trading technically and expect stops to be run in both directions near-term; expect some volatility. Day traders may get a lot of opportunity as the rate will likely cover a lot of the same ground twice on the hourly time-frame. Need a close back under the 50 bar MA today before the start of Tokyo, REALLY making us wait for it. Balance of trade number no factor overnight Tuesday; close under 103.00 likely to attract more selling. USD/CHF Resistance 3: 1.0180 Resistance 2: 1.0140/50 Resistance 1: 1.0100 Latest New York: 1.0087 Support 1: 1.0050 Support 2: 1.0010/20 Support 3: .9980 If short from 1.0180/1.0200 area hold and look to ADD on a close below the 1.0050 area today. 2-22-08 SHORT 1.0030 Stop @ 1.0130 Comments Rate still two-way and consolidating, waiting for US housing data tomorrow most likely. Stops a risk above the 101.40/50 area; also under the .9950 area look for a test of the lower portion on the range within 48 hours (Wednesday AM) Expect a bounce from .9950 so OK to cover shorts and go long from that zone. Be nimble though as a break below there likely to draw aggressive selling. No follow-through is to be respected; look for inside range day closing higher tomorrow 4-22-08 with no action over the 1.0140/50 area. ADD on the close 4-22-08; should be Short 1.0180 Stop @ 1.0280, more on at 1.0030 Tuesday. USD/CAD Resistance 3: 1.0220 Resistance 2: 1.0200 Resistance 1: 1.0160 Latest New York: 1.0122 Support 1: 1.0070 Support 2: 1.0020/30 Support 3: 1.0000/.9990 04-21-08 SELL 1.0060 Stops @ 1.0160 BOC cuts rates 50 BP; slightly surprises market. Stop was missed; OK to ADD on further weakness. Comments Sell signal overnight, OK to hold through the close as stops are out of range from last week. Close below 1.0000 sets up break into the bottom of the range in my view. Massive head-fake on the news this morning but rate misses our stop; OK to ADD more on a break of the 1.0000 handle Tested downside for light support at the 50 bar MA, Nothing to do but continue to wait in my view. 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.

Daily Forex Analysis Today’s US Dollar Trading • USD two-way initially overnight • USD data disappoints • Ends USD mixed Overnight Preview • Traders look for consolidation and book-squaring • No news is due so volatility possible Looking Ahead • Next week Durable Goods, Existing and New Home Sales, Michigan Sentiment Summary The USD ends New York mixed after a solid two-way forex trading day. Traders note that stops and USD short-covering were seen overnight and after the London fix; a short-squeeze in Cable also flushed weak hands and desks report that today’s action was not an expected reaction to the worse-than-expected Philly Fed data. Forecast at -14 the released number came in at -24.9 and was seen as further evidence the US economy is slipping into recession. Regardless of the debate the Greenback showed only a modest initial reaction preferring to remain within established overnight ranges until after the London Fix. Cable lead the complex higher as stops above the 1.9850/60 area and more at 1.9880 lifted the rate into the next level of resistance at the 1.9926 making today’s action in cable one of the largest ranges in the past few weeks; one trader made the observation “don’t try and make sense of it” when asked of the unexpected rally. A solid short-squeeze forcing out the longs is all it is and a reaction lower is likely ahead of Friday. EURO held up near the highs until comments from overseas cracked the amour of the bulls, falling into stops the rate pressed for lows at the 1.5850 area during New York but never testing the earlier lows under the 1.5800 handle Wednesday. EURO although firmer, is unlikely to rally significantly tomorrow as today’s break likely will encourage a round of long-liquidation from the nervous longs. USD/JPY held firm after the initial flurry of activity around the news; high prints came later at 102.73 challenging the resting offers said to be ahead of the 102.80/103.00 area. Traders note that across the board the USD had bids and offers in places where previous S/R was expected to contain but somehow was vaulted; apparently a lot of trade today was “unexpected” and that is pushing people to the sidelines a bit. Looking ahead to Friday no news is expected leaving the USD vulnerable to rhetoric-driven rally or breaks; if not on the right side today it’s OK to stay on the sidelines tomorrow. Forex Traders with shorts active in GBP likely stopped out so don’t rush back to the trade; tomorrow will likely end the week with volatility. GBP/USD Daily R3: 2.0000 R2: 1.9980 R1: 1.9950 Current Price: 1.9910 S1: 1.9880 S2: 1.9820/30 S3: 1.9780 Another “what the …..?” rally squeezes shorts hard triggering stops all the way past the comfort zone of the 100 bar MA. Now that the bids are erased there is little change of a follow-on rally without aggressive new buying and that is unlikely ahead of a weekend. Rate appears to be rallying on EURO-Sterling liquidation; not outright buying. Stops from longs likely in range from 1.9800 all the way to 1.9900 for the day-traders. Expect a fall-back soon, if stopped out—take a break. Next week is a new week. USD/JPY Daily R3: 103.20 R2: 103.00 R1: 102.80 Current Price: 102.59 S1: 102.20 S2: 102.00 S3: 101.80 Rate almost at resistance offered by the 50 bar MA; highs today still within established S/R of sideways range. No real action happened today despite the large rally; mostly stops and short-time frame traders some desks reporting. Look for follow-through buying to be limited and hold under the 103.00 area; a long-liquidating break is possible as profit taking hits the rate. Firmer stocks into the close today likely to give a boost in early Asia but don’t expect it to last. 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.