Alaron Currency Comment

CHICAGO - Nov 15/06 - SNS -- Following is the grain and oilseed futures comment from Alaron Trading Corp.

U.S. DOLLAR INDEX (DXU6):

The DX opened lower at 85.06 against the JY and EC ahead of an expected soft PPI and Retail Sales. Prices retraced to a morning LO of 84.80 after the PPI showed a lower than expected decrease of -1.6% and Retail Sales fell -0.2%. Prices rebounded to a morning Hi of 85.30 and drifted to 85.20 as we enter the afternoon session. The DX drifted lower during the afternoon and ended the session at our Pivot level of 85.08, down 11 tics. The s/t trend remains 'negative' as momentum indicators struggle off the 'over-sold' levels. Another higher (H&L) at our .618 fib level may be a Support level, but talk of rate cuts will weigh on prices. A higher open should find Resistance at 85.32 and 85.56, while an open below 85.06 may find Support at 84.82 and 84.56.

CANADIAN DOLLAR (CDZ6):

The CD opened higher at .8794 and rose to a morning Hi of .8820 on a weaker DX and firmer energy prices. As the DX rebounded, the CD retraced to a morning Lo of .8782 and bounced to .8785 as we begin afternoon trading.

As the DX retraced, the CD rose into the close to end the day at .8797, up 4 tics. The s/t trend remains 'negative' as momentum indicators struggle off the 'over-sold' levels. A close above the 'swing-low' Support level of .8775 may have signaled a s/t reversal, provided energy markets lend support. A lower open may find Support at .8776 and .8755, while an open above .8798 should find Resistance at .8819 and .8841.

BRITISH POUND (BPZ6):

The BP opened lower at our secondary Support level of 1.8970 after weaker than expected inflation data weighed on future rate increases. Prices rebounded to a morning Hi at our initial Resistance level of 1.9042 as the DX retraced, before retracing to a morning Lo of 1.8927. As we begin afternoon trading the BP has rebounded to 1.8950. Prices continued higher as the DX retraced and ended the session at 1.8975, down 40 tics. The s/t trend remains 'negative' as momentum indicators draw back to a 'neutral' position. We may see consolidation as traders may hold long positions, looking for further DX weakness. A lower open may find Support at 1.8921 and 1.8866, while an open above 1.8981 should find Resistance at 1.9036 and 1.9096.

Euro Currency (ECZ6):

The EC opened higher at 1.2850, despite weaker economic data out of Germany and rose to a morning Hi of 1.2894 as the DX retraced. Prices reversed and dropped to a morning Lo at our initial Support level of 1.2814, before rebounding to 1.2835 as we enter the afternoon session. Prices continued higher into the close, ending the day at 1.2845, up 12 tics. The s/t trend remains 'positive' as momentum indicators move off the 'over-bought' levels, suggesting consolidation as traders await more economic data. A lower open may find Support at 1.2808 and 1.2771, while an open above 1.2851 should find Resistance at 1.2888 and 1. 2931.

. JAPANESE YEN (JYZ6):

The JY opened higher at .8541 after a stronger than expected Q3 GDP report of +2.0% increased the possibility of rate increase by the BoJ by year-end. Prices rose to a morning Hi of .8568, before retracing to a morning Lo at our initial Resistance level of .8525 and bouncing to .8537 as we head into the closing half of trading. The JY added another 11 tics to end the session at .8548. The close above the 9-day MA changes the s/t trend to 'positive' as momentum indicators firm to a 'neutral' reading. We will await the report from the BoJ rate meeting for further confirmation about direction and timing of another increase. A higher open should find Resistance at .8569 and .8590, while an open below .8547 may find Support at .8526 and .8504.

Bob Kozak

Alaron Research Team

800.462.4691

bkozak@alaron.com

www.alaron.com

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