Stronger dollar brings hope to USD bulls Christian Blaabjerg, Filed in: FX Update 09 December 2009 at 8:42 GMT Non-Independent Investment Research Daily Trading Stance The USD goes higher and now firmly trades above its 55 DMA in most crosses (but not USDJPY). This development is confirming the negative correlation break-down from Friday and suggests that USD bulls have more to hope for in the short term. That also means that stocks are likely to be under pressure. The S&P500 edged lower and now flirts with the trendline support since March (1085 today). The technical picture has produced a risk-reward favoring “dip-buying”, but only above the trendline support. Geithner seeks to extend the $700B TARP until next October. Calendar Economic Data Releases Country Time (GMT) Name Saxo Consensus Prior US 15:00 Wholesale Inventories MoM (OCT) -0.5% -0.9% FX FX Daily stance Comment EURUSD - Sell upticks toward 1.4750. Next downside objective at 1.4635, then <1.4500. USDJPY 0/+ Beware large range. Interested in strategic long, but only at good price (low 87.00’s perhaps). EURJPY 0/- Might be overdone short term. Sell ahead of 131.00, for a try lower again. GBPUSD - Sell as the big 1.6250 support area is giving way – could try 1.6000 soon. USDCAD + Interesting upside down head and shoulders in play around 1.07. Buy with stops below 1.0550. FX Options FX-Options Comment EURUSD Vols follows higher as dollar bullishness continues. Back end risk reversals still point towards a higher dollar so expect this theme to continue. USDJPY Mid to back end continues to see good bids as spot fails to rally. Upside JPY puts are also being aggressively bid so the market is well positioned for a move higher in spot. AUDUSD Few downside strikes starting to see good bids. The rest of the curve remains steady. Gamma is expected to ease after tomorrow’s employment report. Equities Equities Daily stance Comment DAX 0/- Sell at the break of 5665 targeting 5635. S/L above 5682. FTSE 0/- Sell at the break of 5217 targeting 5191. S/L above 5233. S&P500 0/- Sell at the break of 1087 targeting 1079. S/L above 1090. NASDAQ100 0/- DJIA 0/- Futures Commodities Daily Stance Comment Gold 0/- Sell at the break of 1124 and target 1110. Stop above 1130. Silver 0/- Sell at the break of 17.42 and target 17.15. Stop above 17.50. Oil (CLF0) 0/- Sell at the break of 72.35 and target 70.50. Stop above 72.80. Tweet Like LinkedIn Share Google+ Previous Next Comments Please sign in to comment or ask the author a question about this article. Recommended Recommend Unrecommend Recommend Tweet Like LinkedIn Share Google+ Related articles Bernanke's comments on the US economy sent dollar lower Risk appetite back on better than expected US labour market data Look for US GDP today Risk appetite back on Obama's speech and FOMC statement Re-election of Bernanke could spur risk appetite again Topics This post appears under the following topics... GBPUSD EURJPY forex AUDUSD macro FX Options commodities FTSE100 USDCAD equities USDJPY gold silver DAX EURUSD DJI