USDCHF, USDCAD Dollar is still unattractive, however correction has already ripened...
17:21 04/26/2006

So, after unexpectedly good data on the German economy, which have increased probability of interest rates increase in Europe (12), the euro rate, which plans to make a small respite, has again received a forward impulse.

 

Let's remind that preliminary value of a consumer price index in Germany for April made +0.4 % for a month, +2.0 % for a year, at the forecast of +0.2 % for a month, +1.9 % for a year, and the previous value of 0.0 % for a month, +1.8 % for a year.

And preliminary value of the harmonized consumer price index in Germany for April made +2.3 % for a year, at the previous value of +1.9 % for a year.

 

Besides the single European currency was supported additionally by the statement of a member of ECB Governing Council Smagi, who noticed that to prevent inflation growth and in case of acceleration of rates of economic rise in the European region ECB will have to raise rates.

 

However later the dollar has also felt strong support in the form of unexpectedly positive economic data in the USA, which have also strengthened positive players’ expectations that at June FOMC meeting the decision on the next basic interest rate increase will be made.

 

So, the consumer confidence index in the USA for April made 109.6, at the forecast 107.0. And the previous value has been revised from 107.2 up to 107.5. The parameter was not only much better than the forecast, but also reached a maximum level for last four years.

Let's remind that the index is calculated on Conference Board order’s by NFO Research Inc., surveying about 5.000 American families.

It is necessary to notice that such important components of consumer confidence index as the index of current situation in April grew up to 136.2 points from 133.3 points in March. And the index of expectations rose up to 91.9 points from 90.3 points, and it was originally informed on 89.9 points.

Besides the number of those, considering that "there are a lot of vacancies", has grown up to 29.1 % from 28.3 %. And number of those, believing that "to find job is difficult”, has decreased to 19.6 % from 20.4 % a month earlier, and it was originally informed on 20.7 %.

 

Another important indicator, which is watched closely not only by investors but also is traditionally considered by FOMC members, has exceeded the previous value instead of expected falling.

So, existing home sales in the USA made 6.92 million for March, at the forecast 6.60 million, and the previous value 6.91 million.

 

And two more indicators, which will not be ignored by the market’s participants, will be published today. So, at 12:30 GMT players find out value of durable goods orders index in the USA for March. We shall remind that the forecast of this parameter is equal to +1.5 %, and the previous value of +2.6 %.

Later, at 14:00 GMT new home sales data in the USA for March will be published. We shall remind that the forecast of a parameter is equal to 1140 thousand, and the previous value 1080 thousand.

 

We still recommend to wait for correction in favor of dollar. And aggressive players are advised cautious purchases of dollar/franc and dollar/canadian rates from current levels 1.2695 and 1.1315 accordingly. We shall remind that prospective growth is possible only within the limits of rates correction that is why positions should be opened with minimal lots.

Conservative players should wait for the end of this correction, being outside of the market.

 

 


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