Daily Commentary for June 23rd, 2006

Good Thursday Evening/Friday Morning,

The Dollar Flexes Its Muscles
The US Dollar ignored some weak data today to make strong gains in many of the major pairs today. Most of the so-called experts claim the rally was driven by technical indicators, as there was a lack of good news today to cause such a rise. Fortunately for our clients, we were long the dollar in a majority of our strategies, and thus they were able to make some nice profits. As we have said in the past, our strategies are designed from proprietary algorithms; we do not utilize technical indicators. I was reading an interview in one of the popular financial magazines this month. They were interviewing a trader, who basically stated that algorithm based strategies do not work, because the market is driven by human emotion. Apparently this trader is confused, because that is one of the reasons why algorithms DO work. If you’re able to mathematically quantify the behavior of a set(s) of people, for a given time, you will have a better chance of accurately predicting the future behavior of those people. All major companies do this, from their product development to their marketing efforts…..we do the same with our strategies.

Technical Indicators
Eur/Usd
The major number in this pair is 1.2250. That is the support level that many technicians are pointing to.
Usd/Jpy
Exciting session today as the dollar gained on the yen by about 120 pips. Watch how this pair behaves in the 116.30 region, as that appears to be the next level of resistance.
Usd/Chf
.2570 appears to be the next major resistance level, as the .2520 level we pointed out yesterday appears to have been breached. It wasn’t a violent move through .2520, so perhaps this level may stick after all.

What Our Strategies Are Telling Us as of 6/22, 10PM ET:
We have 10 strategies that we will report to our clients on a daily basis in regards to their respective dollar bias. Our intent is not to provide investment advice to those who read this following section. We are merely reporting the biases that our strategies are exhibiting.

Eur/Usd
$ Long Bias
Usd/Jpy
$ Long Bias
Usd/Chf
$ Long Bias

We are finding the market moves have been much more “fluid,” as of late, as opposed to the choppy activity that has been evident in the market the past few weeks. Our strategy subscribers are reaping the benefits of these moves.


Thank you for your continued support, and keep track of our strategy progress at: http://www.fxstreet.com/nou/content/...p?menu=tracker , along with the equity charts on our website. If you would like to receive our commentary before it is released to the public for free in PDF format, please send us your e-mail, and we will gladly include you on the subscribers list.

T2
www.tsquaredtrading.com