Recovery signs push JPY down, NFP on tap August 06, 2010 8:31 AM CEST

G10 Advancers and Decliners vs USD   CAD 0.03   NOK 0.00 DKK -0.06   EUR -0.07   SEK -0.08   GBP -0.11   AUD -0.13   CHF -0.26   JPY -0.30   NZD -0.40     Global Indexes Current Level % Change Nikkei 225 Index 9632.88 - 0.22 Hang Seng Index 21671.55 + 0.56 Shanghai Index 2624.45 + 0.14 FTSE futures 5356.00 - 0.38 DAX futures 6342.00 - 0.01 DJIA futures 10644.00 + 0.08 S&P future 1124.80 + 0.12   World Markets Current Level % Change Gold 1195.75 + 0.07 Silver 18.36 + 0.16 Crude wti 82.14 + 0.16 VIX 22.10 - 0.50 USD Index 80.83 0.00   Todays Calender Estimates Previous Country / GMT PPI Input (MoM)/(YoY) -0.5%/11.4 -0.2%/10.7 GBP/0830 PPI Output (MoM)/(YoY) 0%/4.9% -0.3%/5.1% GBP/0830 Industrial Production (MoM)/(YoY) 0.1%/1.9% 0.7%/2.6% GBP/0830 Industrial Production (MoM)/(YoY) 0.5%/11.6% 2.6%/12.4% EUR/1000 Net Change in Employment 12.5K 93.2K CAD/1100 Unemployment Rate 7.9% 7.9% CAD/1100 Change in Nonfarm Payrolls -65K -125K USD/1230 Change in Private Payrolls 90K 83K USD/1230 Change in Manufacturing Payrolls 13K 9K USD/1230 Unemployment Rate 9.6% 9.5% USD/1230 Consumer Credit -$5.3B -$9.1B USD/1900

Currency Tech EURUSD R 2: 1.3428 R 1: 1.3369 CURRENT: 1.3194 S 1: 1.3096 S 2: 1.2989 USDJPY R 2: 87.20 R 1: 86.80 CURRENT: 86.15 S 1: 85.30 S 2: 84.83 GBPUSD R 2: 1.6171 R 1: 1.6067 CURRENT: 1.5903 S 1: 1.5802 S 2: 1.5713 AUDUSD R 2: 0.9325 R 1: 0.9200 CURRENT: 0.9171 S 1: 0.9071 S 2: 0.8960   Market Brief The JPY weakened against most of its major counterparts as gains in Asian stocks and as the German industrial production probably rose 0.5% (prev. 2.6%) while UK’s manufacturing output climbed 0.4% (prev. 0.3%). Economies in Europe are expected to do really well and with risk appetite improving the trend for the JPY would be on the downside. The EURJPY climbed to 113.47, heading for a 0.5% gain this week while USDJPY gained to 86.03. The EURUSD headed for a second weekly gain before the Nonfarm payrolls report that will show employers cut 65,000 jobs in July, after trimming 125,000 positions the previous month trading at 1.3191 after rising to 1.3262 on Tuesday, the strongest since May 3. There’s certainly a lot of negativity priced into the US USD lately based on the outlook for the US economy with the USDJPY at risk of a further loss on any weak payrolls number. Yesterday, US initial jobless claims rose 19,000 to 479,000 in the week ended July 31 intensifying speculation the Fed will discuss stimulus measures at its policy meeting next week. After yesterday’s ECB rate decision, President Trichet said the region is recovering faster than forecast and money markets are improving, paving the way for the ECB to phase out liquidity tools used to fight the financial crisis adding that the available data for Q3 are better than expected. USDCAD traded near a three-month low before a government report that will show employment increased for a seventh month, backing the case for the central bank to raise interest rates. Finance Minister Jim Flaherty said yesterday Canada’s strong economic “fundamentals” support demand for its assets and that its no surprise the CAD has become more attractive. The BOC had previously increased borrowing costs by 25 basis points on June 1 and again on July 20 with the current interest rate standing at 0.75% and the next policy meeting on Sept. 8. The USDCAD could test the April low of 0.9931, currently trading at 1.0166 after it fell to 1.0108, the lowest level since May

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