NEWS / European Community

Euro still range bound - break out soon

Daily Currency report for Monday September 04 2006

This is only a guide. Please refer to our specific entry signals for exact entries and stops.

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This Week's Economic Calendar
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Date ET Release For Actual Briefing.com Consensus Prior Revised From
Sep 06 08:30 Productivity-Rev. Q2 1.6% 1.6% 1.1%
Sep 06 10:00 ISM Services Aug NA 55.0 54.8
Sep 06 10:30 Crude Inventories 09/01 NA NA 2481K
Sep 06 14:00 Fed's Beige Book
Sep 07 08:30 Initial Claims 09/02 315K NA 316K
Sep 07 10:00 Wholesale Inventories Jul 0.8% 0.7% 0.8%
Sep 08 15:00 Consumer Credit Jul $7.5B $7.0B $10.3B

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EUR/USD

Medium Term Trend: At last we are in the new month and the euro has already shown some signs of life. Remember that we have been stuck in a range between 1.2700 and 1.2900 (most of the time) since late July, so we can't get too excited about anything unless/until we break outside this zone. This is likely to happen this month, but there may yet be some work to do before that happens. We continue to prefer the stronger euro scenario, and feel that it is only a matter of time before the 1.2950 level is removed by a breakout rally. Dips continue to be buying opportunities, with the support now at 1.2750. Only below 1.2700 would the rally be postponed, and we would then have to allow for another dip to 1.2650, and perhaps even 1.2450.

Strategy today: Try small longs at 1.2800, stops below 1.2750. Watch again for basing at 1.2700, stops well below 1.2650.

Chart: Looking a little more perky, but still range-bound.