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The Currency Futures Report

Yen 'Weaker' on Increased Risk Tolerance

Fri, Mar 27 2009, 06:39 GMT
by Bob Kozak

Alaron  |  View company's profile

Japanese Yen (JYM9):

The Yen opend lower at 1.0186 as equity markets rose and carry-traders sold Yen to add higher risk assets to their portfolios. Prices rose to a morning Hi of 1.0215, before sliding to 1.0141 as equity prices rebounded at the start of the afternoon session. The JY continued w/in a tight range through to the close of 1.0163, down 127 tics.The s/t trend remains 'negative' w/weak momentum indicators. Traders will look for a test of the previous Target Lo of 1.0054 on 3/5. A lower open may find Support at 1.0110 and 1.0058, while an open above 1.0194 should find Resistance at 1.0246 and 1.0330.

Dollar Index (DXM9):

The DX opened lower at 84.08 as traders sold off the safe-haven benefits of the DX to participate in higher equity prices. Prices dipped to a morning Lo of 83.91, before bouncing to a morning Hi of 84.595 and drifting lower into the afternoon session. As equity prices drifted lower, the DX rose to a day-session Hi of 84.70, before ending the day at 84.635, up 34 tics. The s/t trend remains 'negative' w/ weak momentum indicators. The s/t trend remains 'negaive' w/ weak momentum indicators. As long as the equity markets continue higher, the safe-haven aspects will be under pressure and weigh on prices. A higher open should find Resistance at 84.91 and 85.20, while an open below 84.41 may find Support at 84.12 and 83.62.

British Pound (BPM9):

Sterling opened lower at 1.4578 after a weaker than expected Retail Sales Report showing a -1.9% decrease last month. Prices jumped to a morning Hi of 1.4640, before following equity prices lower, to a morning Lo of 1.4475. Traders brought prices to a daily Lo of 1.4426, before closing the day-session at 1.4439, down 92 tics. The s/t trend remains 'positive' w/ firm momentum indicators. Traders will key on the DX for direction. A lower open may find Support at 1.4363 and 1.4288, while an open above 1.4502 should find Resistance at 1.4577 and 1.4716.

Canadian Dollar (CDM9):

The CD opened higher at .8163 and rose to a morning Hi of .8179, against a weaker DX and higher commodity prices. Prices drifted lower into the start of afternoon trading and ended the day at .8136, up 26 tics. The s/t trend remains 'positive'w/ firm momentum indicators. Higher commodity prices continue to support prices w/in a topping formation. A lower open may find Support at .8106 and .8077, while an open above .8143 should find Resistance at .8172 and .8209.

Euro Currency (ECM9):

The EC opened higher at 1.3610 and rose to a morning Hi of 1.3642, before following equity prices lower and finding Support at our Pivot area of 1.3546 as we enter the afternoon session. The late afternoon rally in the DX weighed on the EC, sending it lower to a close of 1.3514, down 52 tics. The s/t trend remains 'positive'w/expensive momentum indicators.The 'flagging' pattern is being weighed down by the potential of a 50bp-100bp rate cut by the ECB at the April 2nd meeting. A lower open may find Support at 1.3462 and 1.3410, while an open above 1.3552 should find Resistance at 1.3604 and 1.3694.

Published on  Fri, Mar 27 2009, 06:41 GMT

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