The EUR USD reversed an earlier uptrend to close lower for the day. The Dollar rose as Treasury Secretary Paulson reiterated his call for a strong Dollar, saying it is "really very important." Paulsons speech was essentially a call for confidence in the U.S. financial markets. In his speech Paulson said he was "confident" that law makers will pass a bill to "boost confidence" in Fannie Mae and Freddie Mac.

Comments from Philadelphia Fed President Charles Prosser ignited the second wave of buying for the Dollar when he called for the Fed to "raise rates sooner rather than later." Based on recent Fed minutes, he has been known to be hawkish in his commentary.

Also putting pressure on the Euro today was the decrease in crude oil. The energy market took back all of the gain this week when tropical storm in the Gulf of Mexico shifted its direction away from refineries.

Technically, the trend turned down in EUR USD as the market plunged through the last swing bottom at 1.5783. The charts indicate 1.5625 is the next downside target.

The USD JPY jumped higher as the stock market surged on supportive comments from Treasury Secretary Paulson calling for confidence in U.S. financial markets and the drop in crude oil when a tropical storm veered away from refineries. The strong move in the stock market may continue tomorrow as the charts indicate several price objectives to the upside which have to be met. In addition, the inability to sustain the oil rally and break the stock market is very good indications of an impending change of sentiment.

Technically, the USD JPY is set up for a breakout over the last swing top at 107.75. This move will change the trend to up and signal a further rally to the main target of 109.93.

Todays rally then selloff looks as if this may have been the last attempt to rally this pair. Based on the recent bearish reports in housing and inflation, it is inexplicable as to what was holding this market up. Additionally, a comment from Bank of England policymaker David Blanchflower that the U.K. was entering a recession that could last for at least a year should have had this market down yesterday. Nonetheless, it looks as if the strength in the Dollar will be enough to drive the longs out of the Pound.

Technically, this market broke a key up trending support angle. Look for a further decline to a retracement zone at 1.9902 to 1.9842.

The USD CHF rallied on Tuesday as the U.S. stock market gained support from the financial sector after Treasury Secretary Paulson's comments stopped the markets early morning weakness. As confidence builds in the U.S. stock market, look for traders to get more aggressive in their long positions by borrowing Swiss to buy Dollars. Contradicting reports regarding the state of the Swiss economy are helping to fuel talk that the Swiss central bank will not raise interest rates. The charts indicate this market is poised to rally to 1.0375 to 1.0390.

The USD CAD rallied as weak crude oil and gold markets are expected to drive Canadian exports lower. The rally was also supported by a report that Canadian Retail Sales were less than expected. This Retail Sales news indicates that the Bank of Canada is done raising rates this year. The charts indicate that this market is poised for more upside with targets set at 1.0106 to 1.0137.