| O&F FOREX News & ViewsBy: Head Trader, Derek Frey | |||||
| June 9, 2008 | |||||
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| General Market Comments: | |||||
| This week we continue with a full schedule of upcoming data announcements. We have both BoJ and BoC meetings this week. Both are expected to fall in line with the other major central banks around the world and do nothing. Bottom line for most of the majors continues to be sideways trading within well established ranges. We are now near the opposite extreme from where we began last week, but a breakout of the range, for the most part, remains low. | |||||
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Europe |
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| EUR/USD: This pair is not expected to breakout above 1.60 in the near term, but a retest of that level is very much in the cards. Rather than chasing the long side we will attempt to fade this rally as it approaches 1.59. GBP/USD: The cable has held support below and continues to hover around the critical 1.9750 handle. We are expecting upside follow through in this pair over the coming weeks. We are therefore buyers of major dips. Stops will start out below last weeks lows. Minimum upside objective of 1.9850 but frankly we expect to see this pair trading above 2.00 before the month is out. USD/CHF: This pair has now hit our 102 objective and we are exiting all our shorts. We could see more downside early this week but we are ultimately expecting a bounce to carry us back to 103. We remain biased to a downside breakout but even if that comes we will wait to fade it rather than chase it as we see minor range expansion at best not the beginning of a new trend. Look to buy a retest at parity. |
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| ASIA
Yen, Australian Dollar |
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| USD/JPY: This pair has not yet hit our downside objective of 103 but we remain confident that it will be hit later this week. Bottom line here is simply selling rallies this week. We still see this market being stuck in a range between 103-106 for the near term. AUD/USD: This pair has struggled to break away from the .9600 handle. Now that the RBA has signaled its intention to do nothing with interest rates in the near term we prefer to be sellers rather than buyers. We are short sellers above that level with stops above .9655 targeting a move back below .9500. |
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| North America
Canadian |
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| USD/CAD: This pair rallied more than we expected. Our first line of shorts was stopped out but we did reenter north of 1.02. We remain short from that level with stops above 1.0255. We expect to see this pair drift back down to parity after we get through the BoC meeting later this week. |
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