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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] FX Market Sees Green Li= ght to Sell Yen January 22, 7:00 AM: EUR/$..0.8835 $/JPY..134.15 GBP/$..1.4= 270 $/CHF..1.6625 FX Market Sees Green Light to Sell Yen by Jes Black At = 10:00:00 AM US Dec Leading Indic. (exp 0.7%, prev 0.5%) At 2:00:00 PM US De= c Fed. Budget (exp 24 bln, prev -54.3 bln) The yen crumbled to a new 3-yea= r low of 134.33 after US Treasury Secretary O'Neill refused to engage in a = "weak yen" debate but agreed that markets should set FX rates. Traders fear= ed O'Neill would show some apprehension as to the yen's sharp slide. Instea= d, his remarks were seen as still backing the strong dollar policy and take= n implicitly that the yen should be allowed to fall. However, O'Neill also = pointed out that a competitive devaluation would not fix Japan's non-perfor= ming loan problem or improve productivity. Moreover, the US is only likely = to support yen weakness if it means Japan forces banks to dump bad loans, a= ccelerates structural reforms and deregulates the markets, like the US has = done. Yet tolerance of a weaker yen is seen giving traders the green light= to sell it towards 135 in the near term. USD/JPY rose as high as 134.33 an= d if the pair can hold above 134.00, technically, the dollar will target 13= 5.00 in the near term. Support is seen at 133.80 followed by 133.30 and 132= .80. EUR/JPY also hit a fresh 1-week high of 118.73 after hitting a 7-day l= ow of 115.55 last Tuesday. Support is seen at 118.12, which marks the 61.8%= retracement from the January 2 high of 119.71 to last week's low of 115.55= . Follow up support is seen around 117.40, 116.50 and 116.00. The euro/ye= n cross was bolstered by gains in dollar/yen but the euro continued to show= weakness against the dollar after again failing to break resistance at 88.= 50. EUR/USD rose to a session high of 88.52 but quickly pared those gains a= nd fell back to 88.35. Support is seen at 88.15 followed by 87.90 and key s= upport at 87.50, which marks the 31.8% Fibonacci retracement of the move fr= om 82.25 to 95.96. Resistance is seen at 88.50 followed by 89.10, which mar= ks the 50% Fibonacci retracement of the same move. Yet, only a move back ab= ove 89.50 would give any hope of a near term recovery as temporary moves hi= gher are not seen by the market as indicating strength given the euro's dif= ficulty to remain above 90-cents. Limiting the euro's losses to the dollar= were strong gains against the pound following overnight comments from Bank= of England Director for Europe, John Townend, who said the pound was clear= ly overvalued against the euro and would almost certainly need to weaken if= the UK were to join the EMU. EUR/GBP rose half a pence to a day's high of = 61.90. However, any artificial lowering of the rate would step up inflatio= nary pressures for the U.K., cautioned Townend, who would like to see EUR/G= BP rise, but sterling remain stable vs the dollar. Townend also noted that = the U.K. government wont likely assess joining the euro until June 2003. G= BP/USD fell through support at 1.4330 and 1.4300 to a 5-day low of 1.4278. = Cable support is now seen at 1.4270, the 61.8% retracement of the move from= 1.4060 to 1.4606. Resistance is seen at 1.4300, 1.4330, 1.4350. For the U= S session today, earnings will be the focus after traders return from a 3 d= ay weekend. The markets will have to assess over 500 company earnings repor= ts this week, with nearly one in three companies on the S?500 scheduled to = report on Tuesday alone. Again, Wall Street is likely to pay more attention= to the foreward outlook after already pricing in dismal Q4 figures. Compan= ies due to report are Merck, Motorola, Amazon, Merrill Lynch, Johnson & Joh= nson, Boeing and Lucent. Today's key economic data is the leading indicato= rs index for December, which is expected to rise 0.7% after it surprised on= the upside last month with a 0.5% gain. The other main event this week is= Fed Chairman Greenspan's speech before the Senate Budget Committee on Thur= sday. Market sentiment now believes Greenspan probably sounded more pessimi= stic than he intended in his speech on January 11. Therefore, the market is= anticipating a more upbeat tone tomorrow about prospects for economic reco= very. Interest rate futures are pricing in less than a 30% chance of a rate= cut at the Jan 30 meeting, leaving the majority to believe rates will hold= steady at 1.75%, a 40-year low. However, since the dollar index is trading= near 6-month highs, most dealers are now divided over whether a further ra= te cut would help the dollar. =09[IMAGE] Audio Mkt. Analysis Quiet Mark= et Awaits Data, USD Talk Articles & Ideas Philly Fed-Supported Opti= mism EUR/USD: Technical Analysis Articles & Ideas Forex Glossary = Economic 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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