This week we have a full report schedule. We have both PPI and CPI coming out mid week and we are in the midst of earnings season. We expect to see more pressure on the Dollar as it continues to try and put a base in. We continue to expect the Dollar to bottom here against almost all other currencies the only real exception would be the Euro.
Eur:
Trichet did nothing in last weeks meeting as expected, however his statement was a bit more hawkish than many had hoped. We are looking for The Euro to at least retest the highs and frankly we are expecting a brief push through them grabbing headlines north of 1.60. That being said, we do not expect it to follow through and are looking to sell into the new highs rather than chase after them. The safest play would be to buy the 1.59 or 1.60 May or June puts on a push to new highs.
GBP:
The BOE did cut as expected and we did see the market fall briefly below 1.9750. We had recommended buying that break in our Webinars last week so if you took that trade you should now be exiting at least half and moving a stop to at least Break even. The week we will continue to buy dips and look for this pair to move back up to test at least 2.00 before stalling again.
Chf:
As we mentioned in last weeks issue we are buyers or major breaks below parity and this morning was no exception. We bought .9936 and our stops have already been moved to break even. We are not looking to trade this pair in directional swing trades, just intraday hit and run trading as overall direction in this pair is still sideways.
JPY:
This pair continues to struggle getting away from the 100 handle. Near term we see more sideways chop until we get on the other side of the upcoming earnings reports. We are buyers on major dips especially any below 100. But again do not look for a major directional move in the near term.
AUD:
We continue to sell rallies in this pair and at this time we are entering swing to position short trades above .9250 with stops above .9350 targeting a move back down below 90 by months end.
CAD:
My comments on the Canadian have been the same for months now… Sell rallies above 1.02 and cover on breaks below parity. We continue to see this pair training within its range and at this time we are entering shorts on rallies looking to run all the way back to test the lower end of the range near .9800.
