EUR/USD Remains in Uptrend

Financial and Economic News and Comments

US & Canada

• US house prices continued to improve in August, according to the S&P/Case-Shiller home price indices. The 10-city and 20-city composites for August declined 10.6% y/y and 11.3% y/y, respectively; however, showing improvements from their July respective drops of 12.8% y/y and 13.3% y/y. The 10-city and 20-city composites registered their fourth consecutive month-on-month gains in August, climbing 1.3% m/m and 1.2% m/m, respectively, following their July respective rises of 1.7% m/m and 1.6% m/m. Overall, the data suggest a continuing turnaround in the US housing market.

• US consumer confidence unexpectedly declined for a second month in October. The Conference Board US consumer confidence index fell further to 47.7 this month from an upwardly revised 53.4 in September, with labor market conditions playing a major role in this grimmer assessment, the Conference Board reported. The present situation index declined to 20.7 in October, its lowest level since 1983, from 23.0 in September. The expectations index fell to 65.7 from September's 73.7.

• The Richmond Fed manufacturing index unexpectedly fell to 7 in October from 14 in September, showing manufacturing activity in the central Atlantic region expanded for a sixth consecutive month albeit at a more moderate pace, according to data from the Federal Reserve Bank of Richmond. Meanwhile, service sector activity in the region slumped and retail sales dropped this month, according to a separate report from the Richmond Fed.

Europe

• UK high street sales posted the most positive result in almost two years in October and stronger sales growth is expected in November, according to the Confederation of British Industry's October distributive trades survey. The survey result showed 41% of retailers said year-on-year sales volumes rose in October, while 33% said they fell, for a resulting balance of 8%, the highest reading since December 2007, following September's balance of 3%. Survey respondents predicted year-on-year sales volumes to improve in November, with a balance of 19%, the most optimistic reading since July 2007.

Asia-Pacific

• The NAB Australian business sentiment index rose to 16 in Q3 2009 from -4 in Q2, indicating Australia's business confidence rose to its highest level since Q1 2002, the National Australia Bank reported. Business conditions improved in Q3 due to increasing sales and profits, with the business conditions index rising 14 points to 3. The figures suggest near- and long-term business expectations will continue to improve.

FX Strategy Update

 
EUR/USD
USD/JPY
GBP/USD
USD/CHF
USD/CAD
AUD/USD
EUR/JPY

Primary Trend
Positive
Negative
Positive
Negative
Negative
Positive
Neutral

Secondary Trend
Positive
Neutral
Neutral
Negative
Negative
Positive
Neutral

Outlook
Neutral
Neutral
Neutral
Neutral
Neutral
Neutral
Neutral

Action
Buy
Buy
Sell
Buy
None
Buy
None

Current
1.4811
91.78
1.6377
1.0210
1.0641
0.9163
135.97

Start Position
1.4575
88.58
1.6602
1.0385
1.0891
0.6601
N/A

Objective
N/A
N/A
N/A
N/A
N/A
N/A
N/A

Stop
1.4675
86.50
1.6750
N/A
1.0600
0.8570
N/A

Support
1.4750
88.00
1.6000
1.0000
1.0200
0.9000
130.00

1.4400
87.00
1.5750
0.9800
1.0000
0.8800
128.00

Resistance
1.5050
92.50
1.6700
1.0450
1.0700
0.9300
139.00

1.5400
94.50
1.7000
1.0600
1.1000
0.9500
145.00

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