Daily Forex Snapshots

European Session - Usd Rally Takes a Pause

March 20, 2008 5:32 PM CET

G10 Advancers and Decliners vs USD

	JPY	0.31
	GBP	-0.29
	CHF	-1.44
	NZD	-1.51
	DKK	-1.55
	EUR	-1.59
	CAD	-1.87
	SEK	-1.89
	AUD	-2.17
	NOK	-2.44

Global Indexes

Current Level

% Change

Nikkei 225 Index	12,260.44	+ 2.47
FTSE 100 Index	5,521.70	- 0.43
CAC 40 Index	4,536.07	- 0.43
DAX Index	6,335.96	- 0.39
SMI Index	7,004.99	- 0.96
DJIA Index	12,232.93	+ 1.10
NASDAQ 100 Index	2,229.09	+ 0.89

World Markets

Current Level

% Change

Gold	922.90	- 2.25
Silver	17.23	- 6.25
VIX	27.07	- 9.28
Crude wti	100.95	- 1.55
USD Index	72.72	+ 0.80

Todays Calender

Estimates

Country / GMT

No Scheduled Releases

Currency Tech

USDJPY
R 3: 105.00 S
R 2: 101.22 M
R 1: 100.00 P
CURRENT 98.60
S 1: 95.74 M
S 2: 95.00 T
S 3: 79.70 K

GBPUSD
R 3: 2.0577 T
R 2: 2.0447 S
R 1: 2.0100 P
CURRENT 1.9826
S 1: 1.9736 M
S 2: 1.9337 S
S 3: 1.9105 K

EURUSD
R 3: 1.6000 K
R 2: 1.5904 S
R 1: 1.5832 M
CURRENT 1.5424
S 1: 1.5528 S
S 2: 1.5000 K
S 3: 1.4500 P

S: Strong, M: Minor, T: Trendline, K: Keylevel, P: Pivot

Market Brief

The sudden shift in the Usd could be reflective of the change market sentiment toward Feds aggressive and unorthodox approach to monetary policy and inevitable ECB easing. While being lengthened by the commodity markets sell off. But we don’t believe traders should get so bullish on the greenback just yet. The US economy still has plenty of downside risk and we expect the Fed to move closer to 1.00% by mid year. Until this plays out we still see Usd weakness and EurUsd heading higher near term.

Asian Session - Commodities Continue to Sell Off

March 20, 2008 9:24 AM CET

G10 Advancers and Decliners vs USD

	NZD	0.17
	AUD	-0.29
	JPY	-0.37
	GBP	-0.49
	DKK	-0.66
	EUR	-0.67
	SEK	-0.72
	CHF	-0.75
	NOK	-0.94
	CAD	-1.10

Global Indexes

Current Level

% Change

Nikkei 225 Index	12,260.44	+ 2.47
Hang Seng Index	21,040.90	- 3.77
Shanghai Index	3,804.05	+ 1.12
FTSE futures	5,545.00	- 0.75
DAX futures	6,311.50	- 0.89
SMI Futures	7,063.00	+ 0.59
DJIA futures	12,094.00	- 0.20

World Markets

Current Level

% Change

Gold	939.00	- 0.55
Silver	18.15	- 1.25
VIX	29.84	+ 15.70
Crude wti	102.40	- 0.13
USD Index	72.23	+ 0.11

Todays Calender

Estimates

Country / GMT

PMI Composite (Mar Prov.)	52.4	52.8	EZ / 9.00
PMI Manufacturing (Mar Prov.)	52.0	52.3	EZ / 9.00
PMI Services (Mar Prov.)	52.0	52.3	EZ / 9.00
Retail Sales (Feb)	-0.2%(+3.6	0.8%(+5.6%	UK / 9.30
Public Finances (Feb) PSNB	+£2.5bn	-£14.1bn	UK / 9.30
Int'l Securities Transactions (Jan)	c$1,900	c$1.241	CA / 12.30
Leading Indicators (Feb) m/m	0.1%	0.2%	CA / 12.30
Initial Jobless Claims (Mar 15th)	360,000	353,000	US / 12.30
Philly Fed Index (Mar)	-18.0	-24.0	US / 14.00
Index of Leading Indicators (Feb)	-0.3%	-0.1%	US / 14.00

Currency Tech

AUDUSD
R 3: 0.9499
R 2: 0.9473
R 1: 0.9449
CURRENT: 0.9140
S 1: 0.9167
S 2: 0.9128
S 3: 0.9122

EURJPY
R 3: 159.22
R 2: 157.96
R 1: 157.03
CURRENT: 154.50
S 1: 154.07
S 2: 152.57
S 3: 151.81

USDSGD
R 3: 1.3983
R 2: 1.3926
R 1: 1.3878
CURRENT: 1.3871
S 1: 1.3741
S 2: 1.3696
S 3: 1.3500

Market Brief

Usd was stronger in Asian session as the commodity sell off carried over from the US session. We don’t see any fundamental drivers for this sudden weakness but the combination of Fed aggressive action stabilizing market confidence and the pure weight of trading position seem to be the most likely culprit. However the combination of steady yields and weakness in gold and other commodities could indicate a period of strength for the Usd. In addition should the Fed signal a reluctance to ease further we could be setting up for the second leg of the “Usd smile” theory.

On the continent markets will be watching flash PMI to provide indication of the extent of the slowing down in economic growth in the eurozone. While feb composite rise was a positive sign the index points to moderation in activity. Markets will be watching diligently especially in light of the euro fall and growing prospects for a ECB move. A weak release will consequently weigh on the Eur.

In the UK retails Sales are likely to see some pull back from the elevated Jan release. In fact we could see Jan figure revised down. In light of yesterday's 7-2 votes as reported in the MPC minutes and the growing expectation of a near term cut, the Gbp should stay weak. Especially given the dramatic two day sell off from 2.0270 down to 1.9776.

The BoJ has confirmed that Shirakawa, one of the two Deputy Governors, will execute the duties of the Governor until the country reaches a bipartisan agreement on a replacement for the retiring Fukui.

14.00gmt - MPC’s Gieve Speaks on Financial Crises

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