Daily Commentary for September 29th, 2006

Franc & Yen Trending Nicely & I’m Glad I Don’t Like Candy Too Much

Good Thursday Evening, Friday Morning,

We hope everyone had a great week, and are looking forward to a nice weekend. In the past two days, we’ve seen a continuation of some nice moves in the Usd/Chf and Usd/Jpy. Please see our comments below on the possible outlooks for both. Tomorrow’s US Personal Spending data is supposed to be strong but the Chicago PMI is due to be weak. It will be interesting to see which piece of data holds the most weight, in what could be an eventful day in the currency market.

Results from a study out of Norway that examined the affects of sugar on 15-16 year olds, showed that soft drinks and other sugar-filled foods may cause mental problems. I’m not really sure if Coca-Cola, Pepsi, Red Bull, etc. are believing in this study! Have a great weekend everyone!!!

Technical Indicators

Eur/Usd
Those of you who strictly trade the Euro most likely have “Pound Envy,” after watching the sharp moves in that currency the past 24 hours. Meanwhile the Euro has continued to consolidate against the Dollar, perhaps building momentum for another shot at .3000 or a decided move lower towards .2500. Looking at a weekly chart, one would tend to side with the .2500 scenario for now. German retail sales dominate EuroZone news for tomorrow morning.

Usd/Jpy
Our 116.75 support level was not even tested after our previous report. Instead this pair has had a nice steady increase similar to the Franc in which we detail below. This pair is approaching the steel ceiling as of late…118. I really think this pair has a chance of breaking through the 118 level with a quite violent move. The high from April was around 118.60…will it reach that high is another question. Hopefully for Dollar bulls it stays at this level for a few days….that would be strength!!! Look for Japanese CPI later this evening.

Usd/Chf
On Tuesday evening we noted the chart wasn’t very convincing on a Dollar long side, but as usual our strategies are looking much wiser than us, and have held on to Swiss short position for most of this week. I’m actually starting to like the nice gradual ascent this pair has had. When a chart exhibits a 45 degree angle of ascent or descent it’s usually a good sign for a lasting move. With that said, this market has not been very “trendy,” as of late, so let’s keep an eye on the .2500 as a possible top to this move.

What Our Strategies Are Telling Us as of 9/28, 7:00 PM 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
$ Neutral Bias
Usd/Jpy
$ Long Bias
Usd/Chf
$ Long Bias

Our biases have stayed the exact same since our last report, nearly 48 hours ago. If you look at the price movements of the 3 majors we cover there was really no reason for the strategies to change bias; the Dollar increased in price against the Franc and Yen, and basically treaded water against the Euro. Participation is still rather mild around 60%.

Thank you for your continued support, and keep track of our strategy progress at: http://www.fxstreet.com/technical/si...acker/tracker/ along with the equity charts and real-money profit and loss report 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