Weekly Review 4.1.2010

 @ibtimes
on January 04 2010 9:27 PM

The Dollar gained versus the Euro and the Yen and weakened versus the Pound. The lack of major economic events and thin trading volume due to New Year's Eve left traders with speculations about where the market is going. Unemployment Claims came out better than expected and helped the Dollar end the week with an upward momentum. NASDAQ and Dow weakened by -0.72% and -0.87% respectively after reaching fresh yearly highs. Crude Oil gained by 2.3% the past week closing at 79.49$ and Gold (XAU) weakened by -0.72% at 1096.35$. Looking ahead, the upcoming week critical economic events will determine the Dollar's direction. ISM Manufacturing PMI is expected stronger on Monday with 54.1 versus 53.6 prior. Pending Home Sales are expected weaker with -2.5% versus 3.7% prior on Tuesday. ADP Non-Farm Employment Change is expected better with -74K versus -169K prior. The most significant data will be the Non Farm Employment Change which will be released on Friday and is expected with -10K versus -11K prior. Last month's Employment change came out surprisingly better sending the Dollar to its current bullish trend and investors await this month's data to see if the trend will continue.

The Euro weakened by -0.4% versus the Dollar after last week's low liquidity and lack of major economic events. The Euro region is still facing financial problems and a near rate increase doesn't seem likely in the near term. Overall, EUR/USD traded with a high of 1.4458 and a low of 1.4273. Looking Ahead, German Employment Change is expected with 6K versus -7K prior and European CPI is expected with 0.9% versus 0.5% prior, both on Tuesday. Industrial New Orders are expected weaker with -0.9% versus 1.7% prior on Wednesday. Retail Sales and German Factory Orders will be released on Thursday and European Unemployment Rate will end the event filled week.

The Pound gained by 1.3% versus the Dollar and strengthened versus the Euro. The Pound had several price jumps during the week as a result of the lack of liquidity in the market. Overall, GBP/USD traded with a high of 1.6235 and a low of 1.5833. Looking ahead, Manufacturing PMI is expected stronger on Monday along with Mortgage Approvals. Construction PMI is expected with 47.6 on Tuesday. Services PMI will be released on Wednesday. The main event will be the MPC Rate Statement along with the Asset Purchase Facility both are expected unchanged. PPI Input and Output will end this week's economic data on Friday.

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