Europe Inflation at 4%, Aussie hits 24 year highs against the Greenback

CURRENCY TRADING SUMMARY – 1st July 2008 (00:30GMT)

· U.S. Dollar Trading (USD) had a choppy day but was able to recover off lows and make small gains into the US session. Month end adjustment’s and more talk from US treasury Paulson on the strong dollar policy supported. The June Chicago PMI was better than expected at 49.6 bouncing from May’s 48.2. In U.S. share markets, the NASDAQ was down 22 points (-0.98%) and the Dow Jones was up 3 points (0.03%). Crude Oil closed flat ending the New York session at $140.20 per barrel. Looking ahead, May construction spending is forecast to continue is downward slide to -0.6% from Aprils -0.4%. June ISM manufacturing is expected to remain below 50 in a contractionary position at 48.6 (May 49.6).

· The Euro (EUR) found trading above 1.5800 heavy even as the June Eurozone Inflation Report came in at 4.0% on the high end of expectations. The elevated Euro levels brought more overvalued comments this time from French President Sarkozy and ECB’s Almunia. Overall the EUR/USD traded with a low of 1.5732 and a high of 1.5836 before closing the day at 1.5757 in the New York session. Looking ahead, May German Retail Sales seen at 0.5% up from Aprils -0.6%. Euro zone PMI Manufacturing for June expected at 49.1 and the May Unemployment rate forecasted to hold steady at 7.1%.

· The Japanese Yen (JPY) lead by the USD/JPY rebounded of 105 to close above 106 dragging the crosses higher. Steadier stocks and strong month end demand supported. Overall the USDJPY traded with a low of 104.99 and a high of 106.47 before closing the day around 106.05 in the New York session. Looking ahead, 2^nd Quarter Tankan Large Manufacturing Index seen at 3 along with Tankan Capex estimate at 2%. Update Tankan Large manufacturing Index out at 5 for 2^nd Quarter.

· The Sterling (GBP) had a very whippy day tracking the USD strength lower but supported was twice below 1.99. GFK Consumer confidence fell to -34 in June dropping from -29 in May with consumers not expecting the economic situation to improve. Overall the GBP/USD traded with a low of 1.9882 and a high of 1.9966 before closing the day at 1.9927 in the New York session. Looking ahead, June PMI Manufacturing expected 49.8 slightly lower than May’s 50.

· The Australian Dollar (AUD) traded at multi year highs of .9667 on the back of soaring commodities prices but was unable to maintain this level as the USD gain strength in the US session. AUD/NZD traded lower dipping below the 1.26 level as NZD/USD strengthened overnight. Overall the AUD/USD traded with a low of 0.9552 and a high 0.9667 before closing the day at 0.9587. Looking ahead, RBA Interest rate Decision widely expected to remain on hold at 7.25%. Markets will be focusing on the accompanying statement for future rate direction.

· Gold (XAU) rallied to multi month highs as Crude Oil scaled new record highs but eased into the US session as Oil pared gains and USD gained some strength. Overall trading with a low of USD$918.80 and high of USD$935.35 ending the New York session at USD$925 an ounce.

TECHNICAL COMMENTARY

· Euro – 1.5755

Initial support at 1.5720 (June 27 low) followed by 1.5628 (June 26 low). Initial resistance is now located 1.5836 (Jun 30 High) at followed by 1.5844 (Jun 9 high).

· Yen – 106.15

Initial support is located at 104.99 (June 30 low) followed by 104.42 (Jun 9 low). Initial resistance is now at 106.47 (Jun 30 high) followed by 107.22 (Jun 27 high).

· Pound – 1.9925

Initial support at 1.9806 (June 27 low) followed by 1.9715 (Jun 26 low). Initial resistance is now at 1.9967 (Jun 30 high) followed by 2.0027 (Apr 21 high)

· Australian Dollar – 0.9585

Initial support at 0.9554 (June 30 low) followed by 0.9543 (June 27 low). Initial resistance is now at 0.9689 (Intraday channel resistance) followed by 0.9700 (Round number resistance).

· Gold – 925

Initial support at 910.6 (Jun 27 low) followed by 885.1 (Jun 26 low). Initial resistance is now at 935.4 (May 22 high) followed by 939.25 (50% retrace of 1032-846 decline).

Source: Easy-Forex

US FED keeps rates on Hold, Dollar under pressure.

CURRENCY TRADING SUMMARY – 26th June 2008 (00:30GMT)

· U.S. Dollar Trading (USD) fell broadly against most currencies as the FOMC kept rates on hold at 2.00% and disappointed dollar bulls in the accompanying statement. Markets were hoping for more inflation fighting rhetoric to help underpin the dollar moving forward. The statement was judged to be more growth orientated although recent high commodities did receive a mention. May Durable Good came in at expectations at 0.0%. New Homes in May fell 2.5% to 512K on revised April figures of 525K. In U.S. share markets, the NASDAQ was up 33 points (1.39%) and the Dow Jones was up 4 (0.04%). Crude Oil closed down $2.45 ending the New York session at $134.55 per barrel. Looking ahead, first quarter PCE expected at 3.5% and final 1Q GDP expected slightly stronger at 1%. Weekly jobless claims forecasted at 380K.

· The Euro (EUR) jumped higher as the market’s digested the FOMC statement and pared down US rate hike expectations. New Industrial orders came in strong at 2.5% much better then forecasts of -0.6%. ECB President Trichet reiterated his concerns on inflation and the possibility of a July interest rate rise. EUR/JPY was helped to record highs above 169. Overall the EUR/USD traded with a low of 1.5537 and a high of 1.5686 before closing the day at 1.5665 in the New York session. Looking ahead, German May import Prices expected at 1.4%

· The Japanese Yen (JPY) hit day lows after the FOMC announcement but rebounded as strong buying on the crosses supported USD/JPY. Overall the USDJPY traded with a low of 10767 and a high of 108.42 before closing the day around 107.91 in the New York session.

· The Sterling (GBP) made good gains against the weaker greenback but failed to keep up with the Euro. GBP/JPY continues to be well supported trading above 213.00. Overall the GBP/USD traded with a low of 1.9658 and a high of 1.9769 before closing the day at 1.9695 in the New York session. Looking ahead, the May Inflation report will be closely scrutinized.

· The Australian Dollar (AUD) tested the 0.9600 level after the FED news, once again in striking distance of the post float high of 0.9663. AUD/NZD continued to march higher as economic outlooks continued to diverge. Overall the AUD/USD traded with a low of 0.9533 and a high 0.9600 before closing the day at 0.9592.

· Gold (XAU) fell inline with the drop in Crude Oil on reports of increased US stockpiles. Overall trading with a low of USD$874 and high of USD$889 ending the New York session at USD$886 an ounce.

TECHNICAL COMMENTARY

· Euro – 1.5670

Initial support at 1.5461 (June 17 low) followed by 1.5303 (June 13 low). Initial resistance is now located 1.5687 (Jun 20 High) at followed by 1.5844 (Jun 9 high).

· Yen – 107.95

Initial support is located at 107.12 (June 23 low) followed by 106.8 (Jun 12 low). Initial resistance is now at 108.61 (Feb 14 high) followed by 108.98 (Jan 14 high).

· Pound – 1.9740

Initial support at 1.9580 (June 20 low) followed by 1.9471 (Jun 17 low). Initial resistance is now at 1.9791 (Jun 20 high) followed by 1.9852 (May 23 high)

· Australian Dollar – 0.9595

Initial support at 0.9491 (June 20 low) followed by 0.9448 (June 19 low). Initial resistance is now at 0.9603 (June 25 high) followed by 0.9648 (Jun 9 high).

· Gold – 888

Initial support at 858 (Jun 12 low) followed by 850 (Psychological Number). Initial resistance is now at 908 (June 20 high) followed by 909 (June 9 high).

EUR/USD Long

Entry: 1.5539 - 50

Take Profit: 1.5610 - 50

USD/CHF Short

Entry: 1.0380

Take Profit: 1.0320 - 300

GBP/USD Short

Entry: 1.9840 - 50

Take Profit: 1.9780 - 710

USD/JPY Short

Entry: 107.86

Take Profit: 107.26 - 107.00

The trade setups are valid for London and New York Sessions.

Note: Though most of our setups work, sometimes chances are there for failure aswell. We are not responsible for any loss occurred by our trade setup. Plan according to your money management. Forex Trading is risky.