Record highs on the Euro; Dollar/Yen falls below 100.00

News and Events: The US dollar dropped to a new low against the Japanese Yen, falling to 99.77 in early trading, on further concerns that the US economy is headed into a recession, despite what some experts say. The last time the dollar traded at this level against the Yen was on November 9, 1995. Furthermore, the Carlyle Group has failed to reach an agreement on payment of overdue debt caused by the credit crunch which led to margin calls. Several banks forecast that the Dollar-Yen will go to 95.00. Commodity funds and speculative buying are the main culprits of the surge in Gold prices. As the dollar weakens, oil trades at record highs and the US economic outlook bleak, investors have been turning to Gold as the safe haven of choice. Up 19% in 2008, Gold prices hit spot $991 in early trading today. Resistance is seen around $995 and the key level is the psychological $1,000.

Today's Key Issues (time in GMT): 10:00 EUR Germany's IfW Institute Growth Forecast 12:30 CAD Capacity Utilization Rate 4Q 82.00% vs 82.70% 12:30 USD Import Price Index (MoM) FEB 0.80% vs 1.70% 12:30 USD Import Price Index (YoY) FEB 12:30 USD Advance Retail Sales FEB 0.20% vs 0.30% 12:30 USD Retail Sales Less Autos FEB 0.20% vs 0.30% 12:30 USD Initial Jobless Claims Mar-08 355K vs 351K 12:30 USD Continuing Claims Mar-01 2835K vs 2831K 14:00 USD Business Inventories JAN 0.50% vs 0.60%

The Risk Today: EurUsd Euro pushed to a high of 1.5623, an exact 100% extension of the 1.4311-1.4967 range between November 2007 and January 2008. Any push further above 1.5623 would technically very overbought, and warrants a sharp correction. On the downside, look for a retracement to 1.5127, 38.2% Fibonacci level of the 1.4311-1.5623 low-high. GbpUsd Cable is headed straight to the 61.8% Fibonacci retracement of the 2.1167-1.9335 high-low. Trading at 2.0368 right now, we target 2.0468. Support holds right now at 2.0251. UsdJpy The psychological 100.00 level was breached, but has since retraced back to 100.20. The 99.77 low holds as a strong support, for now. On the way back up, 102.00 and 104.00 stand as minor resistances. UsdChf Parity is the obvious target. The pair is under very heavy selling pressure under 1.0800. Unless we come back to these levels, the pair remains very bearish.

Resistance and Support: EURUSD GBPUSD USDJPY USDCHF 1.6000 S 2.1165 T 110.10 T 1.1500 P 1.5800 S 2.0583 S 108.00 K 1.1130 S 1.5623 S 2.0468 S 105.00 S 1.0761 M 1.5580 2.0354 100.20 1.0084 1.5283 M 2.0100 K 100.00 S 1.0045 S 1.5000 K 2.0000 P 99.77 S 1.0000 K 1.4500 P 1.9630 K 94.60 K 0.9853 S S: Strong, M: Minor, T: Trendline, K: Keylevel, P: Pivot