DJ ASIA DAILY FOREX OUTLOOK -

Majors
Tue Jun 29 19:38:00 EDT 2010
SINGAPORE (Dow Jones)--Following are expected trading ranges and outlooks for nine major
currency pairs today:

Immediate Range Larger Range

USD/JPY 88.26-88.93 87.95-89.47
EUR/USD 1.2149-1.2221 1.2043-1.2290
AUD/USD 0.8422-0.8593 0.8381-0.8721
NZD/USD 0.6883-0.6990 0.6866-0.7085
GBP/USD 1.5009-1.5128 1.4958-1.5390
USD/CHF 1.0797-1.0882 1.0740-1.0903
USD/CAD 1.0469-1.0576 1.0338-1.0612
EUR/JPY 107.30-108.57 106.76-109.86
EUR/GBP 0.8065-0.8140 0.8000-0.8174

(Ranges are calculated using recent high and lows, information on the placement of option
strikes, and technical analysis - Fibonacci levels, trendlines and moving averages.)

USD/JPY - to consolidate with risks skewed lower, undermined by unwinding of JPY-funded

carry trades amid inflamed risk aversion (VIX fear gauge jumped 17.69% to 34.13), sharp Wall
Street losses yesterday (DJIA down 2.65%, Nasdaq off 3.85%) as negative investor sentiment
after disappointing Japan May unemployment and industrial production data, U.S. Conference
Board's correction of its China Leading Economic Indicator from +1.7% in April to only +0.3%
was exacerbated by sharp drop in U.S. June consumer confidence index to 52.9 from 62.7 in
May (vs forecast for 62.5). USD/JPY also undermined by Japan exporter sales, lower U.S.
Treasury yields (2-year hit record low); persistent worries about euro zone's debt and banking
sector health. But USD/JPY losses tempered by USD demand for import settlements, profit-
taking on long-yen positions. Data focus: 0500 GMT Japan May housing starts, May
construction orders, 1200 GMT Fed's Evans' interview on CNBC, 1215 GMT U.S. June ADP
national employment report, 1300 GMT Fed's Duke speaks, 1345 GMT June ISM-Chicago PMI.
USD/JPY daily chart mixed as MACD bearish, but stochastics turning bullish at oversold.
Support at 88.26 (yesterday's low), then at 87.95 (May 6 low); breach would expose downside to
87.33 (Dec. 9, 2009 reaction low), then psychological round numbers from 87.00 down to 85.00,
then 84.81 (Nov. 27 bottom). Resistance at 88.93 (hourly chart), then at 89.42-89.47 band
(yesterday's high-Monday's high); breach would temper near-term negative outlook, targeting
89.77 (Friday's high), then 89.98 (Thursday's high), 90.58 (June 23 high) and 91.10 (June 22
high).

EUR/USD - to consolidate with bearish bias. Pair undermined by negative risk sentiment,
continuing euro-zone debt & fiscal woes, concerns about liquidity shortfall when ECB's EUR442
billion 12-month lending facility matures tomorrow and higher borrowing costs for banks if they
roll over their financing from 1-year to shorter terms - FT reported yesterday Spanish banks
lobbying ECB to take action to ease impact from tomorrow's expiration. But EUR/USD losses
tempered by surprise rise in euro-zone economic sentiment indicator to 98.7 in June from 98.4 in
May (against forecast for decline to 98.0); positions adjustment ahead of quarter-end. Data focus:
0800 GMT German June labor market statistics, 0900 GMT June flash estimate euro-area
inflation, 1430 GMT ECB Chief Trichet press conference, 1730 GMT ECB's Lockhart speaks.
EUR/USD daily chart negative-biased as stochastics falling from overbought; positive MACD
histogram bars contracting; bearish parabolic stop-and-reverse signal hit at 1.2250 yesterday.
Support at 1.2149 (yesterday's low); breach would expose downside to 1.2043 (June 11 low),
then 1.1954 (June 10 low) and 1.1875 (4-year low set June 7). Resistance at 1.2221 (hourly
chart), then at 1.2290 (yesterday's high); breach would expose upside to 1.2397 (Monday's high),
then 1.2490 (June 21 high), 1.2583 (55-day moving average) and 1.2672 (May 21 reaction high).

AUD/USD - to trade with bearish bias. Pair undermined by unwinding of long-AUD carry trades
on heightened risk aversion, weaker commodity prices (CRB spot index slumped 7.26 to 256.27
yesterday), lingering concerns about Europe's debt/fiscal & banking sector troubles. But
AUD/USD losses tempered by Aussie-U.S. yield gap. Data focus: 0100 GMT Australia June
skilled vacancies index, 0130 GMT May financial aggregates (including private sector credit),
0630 GMT Australia May international reserves. AUD/USD daily chart negative-biased as
stochastics falling from overbought; positive MACD histogram bars contracting; bearish
parabolic stop-and-reverse signal hit at 0.8586 yesterday, 5-day moving average staging bearish
crossover against 15-day. Support at 0.8422 (June 11 low); breach would expose downside to
0.8381 (61.8% Fibonacci correction of advance from June 8 low of 0.8086 to June 21 high of
0.8859), then 0.8265 (June 10 low), 0.8193 (June 9 low) and 0.8086 (June 8 reaction low).
Resistance at 0.8593 (previous base set Friday); breach would expose upside to 0.8721
(yesterday's high), then 0.8776-0.8780 band (Monday's high-June 23 high), 0.8832 (June 22
high) and 0.8859 (June 21 high).

NZD/USD - to trade with bearish bias. Pair undermined by unwinding of long-NZD carry trades
on elevated risk aversion, weaker commodity prices, lingering concerns about Europe's
debt/fiscal & banking sector troubles. But NZD/USD losses tempered by Kiwi-U.S. yield
advantage, expectations RBNZ will hike rates 25 bps at its July review. NZD/USD daily chart
negative-biased as stochastics falling from overbought; positive MACD histogram bars
contracting; bearish parabolic stop-and-reverse signal hit at 0.6978 yesterday. Support at 0.6883
(June 15 low), then at 0.6866 (50% Fibonacci correction of 0.6569-0.7162 June 8-June 23
advance); breach would expose downside to 0.6799 (June 11 low, roughly matching 61.8%
correction). Resistance at 0.6990 (previous base set Friday); breach would expose upside to
0.7085 (yesterday's high), then 0.7148 (Monday's high), 0.7157-0.7162 band (Friday's high-June
23 high) and 0.7199 (May 12 high).

GBP/USD - to consolidate with risks skewed lower. Pair undermined by heightened investor risk
aversion, concerns over negative impact of fiscal tightening on UK economic growth; but losses
tempered by lingering effect from last week's well received emergency budget, comments from
BOE MPC super-hawk Sentance that UK rates should be increased, GBP demand on soft
EUR/GBP cross. Final reading of UK 1Q GDP originally due today postponed by 2 weeks. "We
speculate that this may trigger significant upward revisions," says Nomura Securities. Data
focus: 0600 GMT UK June Nationwide monthly housing review, 0830 GMT UK 1Q balance of
payments. GBP/USD daily chart mixed as MACD bullish, but stochastics turning bearish at
overbought. Support at 1.5009 (yesterday's low); breach would expose downside to 1.4958
(hourly chart), then 1.4854 (Friday's low, near 55-day moving average), 1.4800 (June 23 low)
and 1.4686 (June 22 low). Resistance at 1.5119-1.5128 band (yesterday's high-Monday's high,
roughly matching previous base set April 28); breach would expose upside to 1.5390 (April 30
reaction high), then 1.5498 (April 26 reaction high) and 1.5523 (April 15 reaction high).

USD/CHF - to consolidate with risks skewed lower. Pair undermined by unwinding of short-
CHF carry trades on higher investor risk aversion, CHF demand on weak EUR/CHF cross which
hit record low of 1.3165 yesterday. But USD/CHF losses tempered by broadly stronger USD
undertone. Data focus: 0930 GMT Swiss June KOF economic barometer. Daily chart negative-
biased as MACD bearish, while stochastics stay suppressed at oversold, suggesting sideways or
lower USD/CHF trading near-term. Support at 1.0797 (yesterday's low); breach would expose
downside to 1.0740 (May 3 reaction low), then 1.0697 (April 27 low) and 1.0614 (200-day
moving average). Resistance at 1.0882 (hourly chart), then at 1.0903 (yesterday's high); breach
would temper near-term negative outlook, targeting 1.0941 (Monday's high, near 100-day
moving average), then 1.1046 (Friday's high), 1.1068 (Thursday's high) and 1.1138 (June 23
high).

USD/CAD - to consolidate with risks skewed higher. Pair underpinned by increased investor risk
aversion, stronger global USD, weaker commodity & oil prices (Nymex crude settled down
$2.31 yesterday at $75.94/barrel), continuing concerns about Europe's debt/fiscal woes. But
USD/CAD gains tempered by expectations BOC will continue to tighten monetary policy
gradually in coming months, positions adjustment ahead of quarterly close. Data focus: 1230
GMT Canada April GDP (expected +0.2% on month). USD/CAD daily chart positive-biased as
stochastics bullish; MACD stages bullish crossover against its exponential moving average.
Resistance at 1.0576 (yesterday's high); breach would target 1.0612 (June 6 high), then 1.0678
(June 7 reaction high), 1.0746 (May 26 high) and 1.0851 (May 25 reaction high). Support at
1.0469 (previous cap set Thursday); breach would expose downside to 1.0338 (yesterday's low),
then 1.0328 (55-day moving average), 1.0315 (Monday's low), 1.0296 (100-day moving
average) and 1.0269 (June 23 low).

EUR/JPY - to consolidate with risks skewed lower after hitting 9-year low of 107.30 on EBS
yesterday. Cross undermined by unwinding of carry trades amid increased risk aversion,
persistent euro zone debt/fiscal worries; but losses tempered by profit-taking on long-yen
positions. Daily chart negative-biased as MACD & stochastics bearish. Support at 107.30
(yesterday's low); breach would expose downside to 106.76 (Nov. 8, 2001 reaction low), then
105.45 (Sept. 4, 2001 reaction low) and psychological 100.00. Resistance at 108.57 (hourly
chart); breach would expose upside to 109.86 (yesterday's high), then 110.81-110.88 band
(Monday's high-Friday's high), 111.01 (Thursday's high) and 111.36 (June 23 high).

Disclaimer
 (This article is general financial information, not personalized investment advice, as it does not
consider the unique circumstances affecting an individual reader's decision to buy or sell a
specific security. Dow Jones does not warrant the accuracy, completeness or timeliness of the
information in this article, and any errors will not be made the basis for any claim against Dow
Jones. The author does not invest in the instruments or markets cited in this article.)