The USD has been well offered in the New York session of trade with many accounts still bearish on the Greenback, looking to take advantage of the latest slide in currencies to build on existing long positions. Data out of the US this morning was mixed with wholesale trade coming in on the softer side, while IBD/TIPP consumer optimism was better after breaking above the key 50 level for the first time since November 2008. Sterling continued to be a relative outperformer, as comments from Stephen Timms that UK measures were working, along with Treasury Byrne who said that the deficit would be halved in 4 years, helped to fuel additional gains. Also generating headlines was the news that the Treasury had granted permission to 10 major banks to repay TARP funds. Treasury Secretary Geithner said that the repayment was an "encouraging sign of financial repair." US equities are mixed, while gold trades flat and oil climbs higher, back above $69.00 to trade higher by some 1.50%.
Usd/Jpy: Has pulled back quite sharply on Tuesday with the market looking set to retest the previous resistance now turned support at 97.25 into the latter half of the session. However, any setbacks are seen limited to this area, with the overall structure now favoring additional gains over the medium-term after the market managed to close above shorter-term trend-line resistance off of the 2009 highs on Friday. A higher low is now sought out by 97.25 ahead of a fresh upside extension towards 100.00, to be confirmed on a break back above 98.90. Strategy: BUY @97.25 FOR A 100.25 OBJECTIVE, STOP @95.75. Recommendation to be removed if not triggered by NY close (5pm ET) on Tuesday.
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