Alaron Currency Comment

CHICAGO - Ma09 11/09 - SNS -- Following is the currency futures comment from Alaron Trading Corp.

The DX opened higher at 82.85 and rose to a morning Hi of 82.965 as equity traders took profit/risk off the table after price increases outpaced expectations. Traders supported higher Treasuries, which supported the DX as other major currency markets retraced. Prices slid to a morning Lo of 82.615, before bouncing into the afternoon session and ending the day-session at 82.795, up 15.5 tics. The s/t trend remains 'negative' w/ weak momentum indicators. Traders will key on equity markets overseas to determine if the risk-aversion will continue, supporting higher DX prices. A higher open should find Resistance at 83.04 and 83.28, while an open below 82.72 may find Support at 82.47 and 82.15.

The CD opened lower at .8656 and followed equity prices and commodity prices to mid-day levels, as traders took profit/risk off the table after an extended run. The higher DX weighed on crude and metals prices as traders reduced exposure in 'commodity currencies'.  The CD ended the session at .8614, down 73 tics. The s/t trend remains 'positive' w/ expensive momentum indicators. A stronger DX would continue to weigh on commodity prices, leading to further profit-taking and a lower  CD. A lower open may find Support at .8571 and .8528, while an open above .8644 should find Resistance at .8687 and .8760.  

The BP opened lower at 1.5100 and slid to a morning Lo of 1.5067 against the rising DX, before bouncing to a mid-day Hi of 1.5173. Traders are looking for weak economic data on Tuesday from the Housing sector and Manufacturing Production sector.  A bounce in  Crude Oil prices sent the BP higher towards the close, before drifting lower to end the session at 1.5133, down 82 tics. The s/t trend remains 'positive' w/ expensive momentum indicators.  Continued risk-aversion and weak economic data could  see prices test the 10-day MA of 1.4962. Longs should  tighten 'stops' or buy 'puts' to reduce exposure. A lower open may find Support at 1.5052 and 1.4970, while an open above 1.5148 should find Resistance at 1.5230 and 1.5326.  

Bob Kozak

Alaron Research Team

800.462.4691

bkozak.com

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