Daily Forex Snapshots

US Session: Dollar Retreats on Shift in Risk Appetite

January 17, 2009 12:11 AM CET

G10 Advancers and Decliners vs USD

	Eur	1.16
	Jpy	0.93
	Gbp	0.69
	Chf	-0.47
	Cad	-0.72
	Sek	-1.15
	Dkk	-1.16
	Aud	-1.57
	Nzd	-1.72
	Nok	-2.68

Global Indexes

Current Level

% Change

DJIA futures	8,243.00	+ 0.99
S&P future	848.60	+ 1.11
Nasdaq futures	1,197.00	+ 1.68
FTSE futures	4,129.50	+ 1.45
CAC futures	3,056.00	+ 1.92
DAX futures	4,388.00	+ 1.04
SMI Futures	5,376.00	+ 1.05

World Markets

Current Level

% Change

Crude wti	36.51	+ 3.14
Gold	843.15	+ 3.10
Silver	11.27	+ 6.22
USD Index	84.21	- 0.27
VIX	46.11	- 9.59

Todays Calender

Estimates

Country / GMT

No Major Events

Currency Tech

AUDUSD
R 3: 0.7048
R 2: 0.6819
R 1: 0.6752
CURRENT: 0.67375
S 1: 0.6538
S 2: 0.6490
S 3: 0.6294

EURJPY
R 3: 125.28
R 2: 121.65
R 1: 119.74
CURRENT: 119.65
S 1: 117.77
S 2: 115.88
S 3: 114.41

USDSGD
R 3: 1.5114
R 2: 1.5068
R 1: 1.4992
CURRENT: 1.4880
S 1: 1.4882
S 2: 1.4831
S 3: 1.4759

Market Brief

Dollar Strength was stopped in its tracks showing only showing gains versus the Jpy. The EurUsd rose over 150pips to mid range of 1.32, while the UsdJpy added 80pips giving the pair significant ground above 90. The GbpUsd also displayed positive momentum trading through 1.47 up 100pips. Equities managed to close higher in the US and Europe, showing a reversal in the sharp downward trend in the financial markets this week. Commodities were mixed, but gold stood out nearly recovering most of this week’s losses. Both gold and oil gained 3% which was consistent with the pattern of risk appetite. Bonds remain well into historical lows, with the 2yr yield at .72% and the 10yr at 2.3%.

Despite a windfall of negative events in Europe and the UK, the sterling as well as the euro closed strong. Traders ignored the economic story in the end, and reverted to the overall perception of risk in the financial system. The macro view is extremely bearish, and acts as a catalyst to the risk aversion trade we saw reemerge. Trichet reiterated his stance on monetary policy at an interview in Japan, where he stated 2.00% is the lowest the central bank can go. This is a dangerous methodology, as the level of systemic risk far exceeds the threat of inflation and may require more aggressive action by the govt. to ward off a prolonged recession.

Risk Disclaimer:

Although every investment involves some degree of risk, the risk of loss in trading off‐exchange forex contracts can be substantial. Therefore if you are considering trading in this market, you should be aware of the risks associated with this product so you can make an informed decision prior to investing. The material presented here is not to be construed as trading advice or strategy. ACMUSA makes a strong effort to use reliable, expansive information, but we make no representation that it is accurate or complete. In addition, we have no obligation to notify you when opinions or data in this material change.

ACM Advanced Currency Markets SA (hereinafter referred as ACM) is a professional financial intermediary, directly regulated by the Swiss Federal Department of Finance, Anti Money Laundering Control Authority. As forex specialist, ACM provides only currency trading via highly professional forex trading software. All customers are aware that this information or any part thereof has been prepared without taking account of your objectives, financial situation and/or needs. This information is not intended as personalized investment advice and does not constitute a recommendation. It is not an offer or solicitation of any offer to purchase or sell any financial instrument. The analysis is based on the information which ACM finds reliable and accurate, but ACM does not assume any responsibility for any material nor for the transactions made on the basis of the information or the estimates of the analysis. ACM cannot guarantee that these forecasts will materialize and cannot be held liable in any way for direct, indirect and/or consequential loss arising from any use of this information, document or its content. All opinions and estimates constitute ACM analysis as of the data and are subject to change without notice. ACM does not warrant the accuracy or completeness of information contained herein, such information is subject to change and is not intended to influence your investment decisions. Past performance is not a reliable indicator of future performance.