Euro 'Weaker' on Lower Than Expected GDP.
Friday, May 15, 2009
by Bob Kozak of C3I Capital Management, LLC
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Euro Currency (ECM9):
The EC opened lower at 1.3529 after a weaker than expected drop in the EZ Q1 GDP of -2.5% vs Q4 GDP of -1.6%. Weaker equity prices overseas pushed the DX higher, adding pressure to the EC as prices retraced to an early morning level of 1.3509. A bounce in globex equity prices helped the EC rise to our initial Support level of 1.3560 ahead of the opening bell in the equity markets. Look for prices to challenge the Support level or fade towards secondary Support of 1.3470. Higher equity prices will help as the safe-haven of the DX will rotate to an increase in risk-appetite, which could see the EC challenge the Pivot level of 1.3612.
Dollar Index (DXM9):
The DX opened higher at 82.92 as the EC retraced on weaker than expected economic data and weaker equity markets boosted interest in the safe-haven of Treasuries and the DX. Prices jumped to 82.925 ahead of release of the CPI and NY Fed Mfg. reports. Equity markets took the reports positively, sending the DX lower, towards our Pivot of 82.57. An increase in equity prices will weigh on the DX, however, longs should tighten 'stops' or buy 'puts' to reduce exposure as traders may take profit/risk off the table ahead of the weekend.
Recent articles from this author
- Dollar 'Pauses' Ahead of FOMC Results. - Tuesday, August 11, 2009
- Cable Breaks Out on PMI Report, DX Drop. - Monday, August 03, 2009
- Sterling 'Shines' As Housing & Stocks Prices Increase. - Thursday, July 30, 2009
- Chinese Equity Correction Sparks Flight to Quality in DX. - Wednesday, July 29, 2009
- Canadian Sets New High for 2009. - Monday, July 27, 2009
About the author
Bob Kozak, Currency Futures Analyst
C3I Capital Management, LLC Bob Kozak is the Senior Currency Futures Analyst and Managing Principal at C3I Capital Management, LLC. He has been involved in the financial markets since 1978, when he was recruited as portfolio strategist for a major Wall Street firm. With a degree in Mathematics from the University of Massachusetts, he was drawn towards technical analysis. He moved into the retail sector as a Certified Financial Planner, assisting clients in structuring an investment portfolio suitable for their particular needs, emphasizing income and risk management. A unique opportunity to mentor under a former Chairman of the Chicago Board of Trade enticed Bob into the commodities arena. Bob eventually managed the office of his mentor, before the firm was purchased and relocated to Chicago. Bob follows most futures markets using primarily Technical Analysis, and takes advantage of the strong correlation between the U.S. Dollar Index and those futures purchased in Dollars. You can request a FREE 2-week trial subscription of PROBABLE DAILY & WEEKLY TRADING RANGES by calling Bob at (561) 674-0014 or email at bkozak@C3ICapital.com Bob has been a frequent contributor to many national publications, including Futures Magazine, Dow Jones Newswire, and Bloomberg FX -TV.
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