Despite yesterday's lack of follow through post FOMC's rate decision we still believe EURUSD is a buy on dips for new all-time highs.

Overnight News Bullets

• UK Retail Sales MoM/YoY (Feb) out at 1.4%/4.9% vs. 0.6%/3.8% expected.
• E-Z Trade Balance (Jan) out at -7.8B vs. -1.0B expected.
• E-Z Industrial New Orders MoM/YoY (Jan) out at -0.2%/12.0% vs. -1.0%/8.4% expected.
• UK CBI Industrial Trends ??“ Orders at 8, highest since 1995.
• US Initial/Cont. Claims out at 316K/2501K vs. 323K/2550K expected.
• US Leading Indicators (Feb) out at -0.5% vs. -0.4% expected.
• US EIA Natural Gas Storage out at 17 vs. -02 expected.
• JN All Industry Activity Index (Jan) out at 0.7% as expected.
  

Markets

• FX: EURUSD again below 1.3370, JPY weakening.
• Fixed Income: Bunds and 10yrs dropping. Big sell-off in JGB??™s
• Stocks: Strong session in the EU, US range more or less unchanged. Nikkei up 0.4% today.
• Commodities: Precious metals still edging higher, but dropping o/n. Crude slightly higher.
  

O/N Data Heat map:

Calendar

Today's Highlights:

This and Next Week??™s Highlights:

What's going on?

• Credit Spreads are continuing to widen and we see an increasing number of stories about the negative impact on the economy from the faltering housing market. Today??™s Existing Home Sales is key.
• EURUSD being rejected at 1.3411, but ended the day higher. We are still bullish. The USD must head lower.
• Yesterday??™s lack of momentum in US stocks could turn out to become a problem in the technical picture. Another day like this could signal a severe reversal.

FX