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[IMAGE] Forums Discuss these points in the Forums: Forexnews Forum T= echnicals Live Charts Analysis available from: Cornelius Luca J.P. Chorek= Technical Research Ltd. Charts & News featuring Standard & Poor's = Interest Rates US: Japan: Eurozone: UK: Switzerland: 1.75% 0.15% 3.= 25% 4.0% 1.25-2.25% [IMAGE] =09 [IMAGE] USD Resilient Despite W= orries Over Corporate America January 17, 7:00 AM: EUR/$..0.8804 $/JPY..132= .05 GBP/$..1.4339 $/CHF..1.6651 USD Resilient Despite Worries Over Corpora= te America by Jes Black At 8:30:00 AM US Dec Building Permits (exp 1.547 m= ln, prev 1.595 mln) US Jobless Claims (exp 430 k, prev 395k) US Dec Housing= Starts (exp 1.6 mln, prev 1.645 mln) At 2:00:00 PM US Jan Phil Fed Survey = (exp 2, prev -12.6) The dollar held onto overnight gains despite a poor = finish on Wall Street on Wednesday as corporate earnings news dominated ove= r data. EUR/USD fell below 88 cents and USD/JPY rose back above the key 132= level, thus boding well for a resumption of its rally after a weeklong dec= line stabilized around 131.80 on Tuesday. However, dollar bulls will want t= o watch tomorrow's meeting between Wasghington and the National Association= of Purchasing Managers. Markets have been reluctant bidding USD much highe= r on the concern that Washington may again waver on the strong dollar polic= y. Recall, last July when this happened, USD fell because the administratio= n appeared uncertain over the strong dollar policy. However, it is just as = important for the US administration let JPY fall in order to keep Japan fro= m falling into a deflationary spiral as many economists fear. In addition = to strong dollar worries, the potential Kmart bankruptcy and the Enron deba= cle could induce European investors, who have been key purchasers of corpor= ate debt last year, to seek out safer alternatives. That in turn would caus= e US bound investment flows to falter because of worries over the health of= US corporations. Nevertheless, these fears failed to boost EUR/USD, which= fell to a fresh 3-week low of 87.92 in European trade. The sell-off was se= en as more technical in nature after falling Tuesday below the key 89.10 le= vel, which marks the 50% Fibonacci retracement of the move from 82.25 to 95= .96. This level is significant in that it reflects equilibrium in supply an= d demand conditions between euro and dollar. Moreover, yesterday's close be= low 88.60 is a bearish sign for the euro and an inability to regain that le= vel will likely call upon further losses. However, EUR/USD would have to br= eak below 87.48, the 31.8% Fib retracement of the same move and channel sup= port. Only a move back above 89.50 would give any hope of a near term recov= ery. However, moves higher are not seen by the market as indicating strengt= h given the euro's difficulty to remain above 90-cents. GBP pared earlier= gains against EUR, falling to a day's low of 61.64 and added to losses vs = US as it fell to a fresh one-week low of 1.4303. Cable sank to its lowest = level against the dollar in over a month on talk of M?related outflows rela= ted to Britain's National Grid Group Plc's $3 billion purchase of US power = group Niagra Mohawk. However, sterling was able to recover from these losse= s and regain the $1.4340 support by afternoon London trade. Yet, Failure fo= r GBP to maintain above 1.4440 will bode poorly for cable as it fell from l= ast Monday's 2-week high of 1.4513, a 3-cent drop in 4 days. Resistance is = seen at 1.4390, 1.4440, 1.4480, 1.450 and 1.4550. On the data front, Brit= ish retail sales showed a surprising 0.3% fall in December, the first month= ly fall in sales since April 2000. December's sales volumes were 5.7% highe= r than a year ago, down from a 7.0% y/y rise in November and a consensus fo= recast by economists for a 6.9% rise. The ONS said the fall in December sal= es volumes was "due to strong November data rather than weak December data.= " It added that the underlying picture of retail sales growth remained stro= ng. Therefore, the move did not weigh on sterling which has benefited from = strong domestic demand in 2001. USD/JPY rose to a day's high of 132.30 af= ter a weeklong decline stabilized around 131.80 on Tuesday. The pair is sti= ll trading below its 3-year high of 133.37 but dealers remain confident the= re will be more weakness to come in the JPY. EUR/JPY also recovered to a = day's high of 116.97, but fell bac below support at 116.50 to a day's low = of 116.01. Moves in the JPY will be important to watch as most of EUR/USD l= osses on Tuesday and Wednesday came on the back of a steep fall in EUR/JPY = to a low of 115.67 from a high of 119.37 last week, or a 3% drop. That's do= uble the losses incurred by USD/JPY. Resistance is now seen at 116.50 follo= wed by 117.00 and key resistance at 117.50. A close above 116.50 will be ne= eded in order to maintain its bullish momentum, dealers say. Key support is= seen at 115.60. The BoJ on Thursday left its gloomy assessment of Japan's= struggling economy intact, repeating the economy continues to deteriorate = in January and using the same wording as in its December report. Tuesday m= arked the start of earnings season and even though most companies beat poor= Q4 expectations, the markets responded more to the general outlook. That w= as evident on Wednesday after Intel beat Q4 estimates but indicated that it= was cutting its cap ex spending more than expected to $5.5 bln from $7.3 b= ln last year, a 25% reduction. This took the market by surprise and trigger= ed a sharp slide in Nasdaq. That means Wall Street is looking more at the e= conomic outlook than to the previous Q4 2001, which was assumed to be bad. = It also means the overnight sell-off was mostly a reaction to the market g= etting ahead of itself in early January without the fundamentals to back it= up. Today's important earnings releases include Citigroup, Ford and Sear= s. Airline companies to report are US, Northwest and Southwest Air. Its als= o another big day for technology companies with IBM, Microsoft, Nortel all = reporting on Thursday. Today's jobless claims are expected to rise to 426k= from last week's 395k due to underfiled claims in California because of a = new law. The rise may be offset slightly by the re-opening of auto factorie= s after a winter close and decreased layoffs in the retail sector. Markets= will also look to the Philly Fed survey to show improvement in the overall= manufacturing activity in the Philly Fed area. The index is expected to im= prove to -2% from -12%. Though negative, such an increase would confirm tha= t the economy is indeed turning around. Also due for release in the US ses= sion is housing starts, which are forecasted to decline slightly to 1.6 mil= lion from the previous 1.645 mln though holding fairly strong. Housing perm= its are estimated to edge up to 1.6 million in December from the previous 1= .595 mln. =09[IMAGE] Audio Mkt. Analysis USD Steadies Despite Equities = Sell-off Articles & Ideas EUR/USD: Technical Analysis Greenspan W= idens Door for One More, But... Articles & Ideas Forex Glossary Eco= nomic Indicators Forex Guides Link Library [IMAGE] =09 =09=09[IMAGE][IMAGE] [IMAGE][IMAGE]=09 =09=09 This e-mail is never sent unsolicited. If you wish to unsubscribe fr= om this or any other Forexnews.com newsletters, please click here . Any op= inions expressed by representatives of Forexnews.com or its affiliates as t= o the commentary, market information, and future direction of prices of spe= cific currencies reflect the views of the individual analyst, and do not ne= cessarily represent the views of Forexnews.com or its affiliates in any way= . In no event shall Forexnews.com or its affiliates have any liability for = any losses incurred in connection with any decision made, action or inactio= n taken by any party in reliance upon the information provided in this mate= rial; or in any delays, inaccuracies, errors in, or omissions of informatio= n. =09
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