Monday, January 03, 2011

3rd of January 2011 - Fundamental Forex Market Overview

DAILY MARKET COMMENTARY
3 January 2011 – 8:00 GMT
Monday

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Market Analysis Desk
Foreign Exchange Research
: www.fibosignals.com/5585/resources.html
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FUNDAMENTAL ANALYSIS at 0800 GMT


USD

Trading was subdued during the Asia session with Japan, Australia, and New Zealand all on holiday. The dollar managed to claw back some of Friday's heavy losses in thin trade. EURUSD traded 1.3276-1.3363, and USDJPY 80.93-81.39. The Australian dollar retreated after setting new 28 year highs on Friday, when it rose to 1.0257 on fix-related buying. No US economic data were released. Today, the manufacturing ISM for December is due and our US economics team is inline with consensus, expecting a modest increase to 57.0 from 56.6 previously. FOMC minutes and the payrolls report are scheduled to follow later in the week. IMM positioning data which is normally released by the CFTC each Friday, will not be published until Monday evening due to the holiday season.


EUR

Estonia became the 17th member of the Eurozone on New Year's Day.


Germany's Chancellor Merkel and French President Sarkozy spoke in favour of maintaining the euro. Sarkozy said he will fight with all his strength to keep the euro as "the end of the euro would be the end of Europe". Merkel said "Germany needs Europe and our common currency", adding that the euro is "the foundation of our prosperity".


AUD

Over the weekend, China's manufacturing PMI for December disappointed expectations and fell back to 53.9 (cons. 55.0) from 55.2 previously.



A. M. Negrin Bautista, CFA

Chief Analyst at Fibosignals.com

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