Daily Currency report for Monday March 12 2007

This is only a guide. Please refer to our specific entry signals for exact entries and stops.

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This Week's Economic Calendar
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Date ET Release For Actual Briefing.com Consensus Prior Revised From
Mar 12 14:00 Treasury Budget Feb -$123.0B -$118.0B -$119.2B
Mar 13 08:30 Retail Sales Feb 0.2% 0.3% 0.0%
Mar 13 08:30 Retail Sales ex-auto Feb 0.3% 0.3% 0.3%
Mar 13 10:00 Business Inventories Jan 0.2% 0.1% 0.0%
Mar 14 08:30 Current Account Q4 -$204.0B -$203.0B -$225.6B
Mar 14 08:30 Export Prices ex-ag. Feb NA NA 0.3%
Mar 14 08:30 Import Prices ex-oil Feb NA NA 0.0%
Mar 14 10:30 Crude Inventories 03/09 NA NA -4848K
Mar 15 08:30 PPI Feb 0.4% 0.4% -0.6%
Mar 15 08:30 Core PPI Feb 0.2% 0.2% 0.2%
Mar 15 08:30 Initial Claims 03/10 330K NA 328K
Mar 15 08:30 NY Empire State Index Mar 15.0 17.0 24.4
Mar 15 09:00 Net Foreign Purchases Jan $15.6B
Mar 15 12:00 Philadelphia Fed Mar 5.0 4.0 0.6
Mar 16 08:30 CPI Feb 0.2% 0.3% 0.2%
Mar 16 08:30 Core CPI Feb 0.2% 0.2% 0.3%
Mar 16 09:15 Industrial Production Feb 0.3% 0.3% -0.5%
Mar 16 09:15 Capacity Utilization Feb 81.3% 81.3% 81.2%
Mar 16 10:00 Mich Sentiment-Prel. Mar 90.0 90.5 91.3

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EUR/USD

Weekly Trend direction: Bearish

Weekly trend reversal level: 1.3215

Resistance levels: 1.3160, 1.3200

Strategy: Whilst above the weekly trend reversal level, sell rallies to resistance after an entry signal.

Medium term: The euro has broken above the large flag formation which has dominated the technical picture in 2006. Now, whilst above 1.2900 (1.2800 max), the euro remains in an uptrend which is heading back towards 1.3600, the multi-year high, and possibly higher still, towards 1.4100.

Very little change as we hover between 1.3100 and 1.3200 since the middle of last month. There is a small "head and shoulders" pattern potentially forming on the hourly charts which will place pressure on the downside, but we don't expect it to complete its projected low at around 1.2950 (although not impossible by any means!) We continue to allow for the euro to have one last look at the downside, probably no lower than 1.3050 - 1.3000, if it must go there, but more likely is a resumption of the bull trend towards 1.3700 from current levels. For today and the rest of this week, we will watch carefully for opportunities to buy euros on convincing dips and clear signs of reversal between 1.3000 and 1.3200 (1.2950 max) Buy near 1.3100/1.3080, stops below 1.3050. Alternatively, sell with the current trend around 1.3160 - 1.3200.

EUR/USD Hourly chart:



EUR/USD Weekly chart: