With big losses in world stock exchanges and a record high of 3.5% of LIBOR over U.S. T-Bills after the House rejected the financial rescue bill, the USD’s stability held up surprisingly well, showing low volatility. Plunging oil & commodity prices acted as a stabilizer, as well as the expectation that the BoE and ECB will eventually lower their interest rates.

For today’s trading, we expect the sideways trend of late Asian and early European hours to continue, as described in the pair discussions below. There are no data releases known as market-movers scheduled for today, but always stay on top of breaking news from the financial and political front since the credit squeeze is still far from calming down.

by George Clement

Intraday Market Outlook for Day Traders

EUR / USD
The EUR / USD is currently trading at 1.4375 in a narrow trading range between 1.4405 and 1.4360 established in Asian and early European trading. We see that range widening today, when we are joined by the U.S. trading hours, to 1.4450 to the upside and 1.4320 to the downside.

GBP / USD
Cable is trading in a broader range than other pairs and is currently at 1.8044. We expect a see-saw market for today, limited on the downside at 1.7960. Upmoves will probably test the 1.8150 level.

USD / CHF
The dollar is currently trading at 1.0990 against the Swiss franc, gaining strength in early European trading. We expect the upmove to be limited for today at 1.1050, before the building of a sideways trading range between that upper limit and the downside support at 1.0940.

USD / JPY
Having tested a support low at 103.60, the dollar gained strength against the yen in Asian and early European trading hours and is currently priced at 105.05. The resistance level at 105.80 could be tested in today’s remaining trading hours, while a setback to support at 104.70 is likely first.