Alaron Currency Comment

CHICAGO - Nov 19/07 - SNS -- Following is the currency futures comment from Alaron Trading Corp.

Canadian Dollar (CDZ7):

The CD opened lower at 1.0246, touched a daily Hi of 1.0264 and retraced to a daily Lo of 1.0160 as weaker energy/metals prices and comments by BoC Governor David Dodge that the bank may consider cutting interest rates because of rising 'risks' to global growth. Concerns with being competitive outside North America may warrant such a 'cut' should the U.S. economy face increase likelinood of a 'recession'. Prices ended the day at 1.0176, down 86 tics. Lower equities could see continued profit/risk taken off the table by carry-traders and lower CD prices. The s/t trend remains 'negative' w/ 'weak' momentum indicators. A lower open may find Support at 1.0136 and 1.0096, while an open above 1.0200 should find Resistance at 1.0240 and 1.0304.

Dollar Index (DXZ7):

The DX opened higher at 75.86, but retraced on further credit concerns and the recent forecast by more economists of a 'recession'. Prices did rebound as the flight to quality in Treasuries from Equities helped the DX rise to a morning Hi of 75.91, before drifting lower towards the close of 75.80, down 4 tics. The NAHB index held at the 19 level for the second month, which is the lowest since records began in 1985, suggesting potential buyers are holding out for larger declines, which will continue to weigh on the economy. The Fed may be looking at more than a 25bp rate cut at over the next few meetings. The s/t trend remains 'positive' w/ 'neutral' momentum indicators. A lower open may find Support at 75.73 and 75.76,  while an open above 75.82 should find Resistance at 75.89 and 75.98.

Euro Currency (ECZ7):

The EC opened higher at 1.4684 and retraced to a morning Lo at our Pivot level of 1.4654 as 'risk-aversion' by carry-traders saw profit/risk taken off the table. Prices rebounded back to  our initial Resistance level of 1.4681, before drifting lower  towards the close to end the day at 1.4674, up 9 tics. The s/t trend remains 'positive' w/ 'expensive' momentum indicators. A higher open should find Resistance at 1.4688 and 1.4702, while an open below 1.4671 may find Support at 1.4657 and 1.4640.

British Pound (BPZ7):

The BP opened higher at 2.0515 and continued to climb to a morning Hi at our initial Resistance level of 2.0535, before retracing throughout the day to a daily Lo of 2.0440. Prices rebounded towards the close to end the session at 2.0478,   down 17 tics. A report showing a 'slowdown' in the Housing sector and possibly further sub-prime woes weighed on prices and the prospect of a rate cut, possibly by year-end. The s/t trend remains 'negative' w/ 'neutral' momentum indicators. A lower open may find Support at 2.0434 and 2.0389, while an open above 2.0484 shouild find Resistance at 2.0529 and 2.0579.

Japanese Yen (JYZ7):

The JY opened higher at .9102 as lower equity prices had carry-traders taking profit/risk off the table and coveirng JY 'shorts'. Prices dipped to a morning Lo of .9090, before rising to a daily Hi at our secondary Resistance level of .9140 and drifting to a close of .9131, up 76 tics. The s/t trend remains 'positive' w/ 'over-bot' momentum indicators. Further weakness in the equity markets could see further JY 'short-covering'. A higher open should find Resistance at .9151 and .9170, while an open below .9120  may find Support at .9101 and .9070.

Bob Kozak

Alaron Research Team

800.462.4691

bkozak.com

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