Overall, following the pattern laid over the last few days of trading, the overnight session proved very slow in the currency market. Since the Friday session opened, the major pairs have barely moved, only swinging around the break-even line. The same could be observed in the main financial markets, with cash and futures equities, or commodities barely moving. However, things are expected to change ahead, as the market moves towards the U.S. session, which has been the main source of liquidity and momentum lately. Dollar Index Technical View: TheLFB Member Charts http://www.thelfb-forex.com/uploadedImages/Member_Charts/Dollar_Index/$index257.3.gif 4 Hour Chart: Mixed. Main price points: 74.95, and 76.57. Looking for: Wave ii Prices on the dollar index are trading lower after 76.57 highs were hit yesterday. It seems that wave ii is already in progress, where traders may look for a three wave push lower, before the up-trend continues. If the wave count is correct then wave ii prices must not fall below the 74.97 region, otherwise the wave count will be invalidated. The euro (Eur/Usd 1.4825) had a very small range since the day had started, of only 50 pips, in which it moved up and down without a clear direction. On the daily chart, the euro is trading just below the 20-day moving average and near a swing point high that was made in Sep 23 09. A break above these two price points can only come on positive equity markets. The pound (Gbp/Usd 1.6540) took advantage of the current side-ways market, and consolidated in the 1.6550 area. From here, the pound might gather enough momentum to pull a break above the 1.6600 area, which has been the main swing point over the last five months of trade. The aussie (Aud/Usd 0.9140) is preparing to close the week down almost 1%, as the selling seen in the commodity markets acted as a major drag on the Australian dollar. Since the beginning of the year, the aussie had been the best performing pair, but the vast majority of gains came from the commodity market link. As such, in order to push any higher, the aussie will need a strong coil and gold market. The cad (Usd/Cad 1.0670) almost came to a standstill during the Asian session, but the pair picked up some additional momentum throughout European trade. Historically, the cad moves very little during the overnight session, with the vast majority of trends being concentrated during the U.S. trading hours. Ahead, investors prepare for Augusts’ GDP read from Canada, expected at 0.1%. The swissy (Usd/Chf 1.0180) moved with a very slow momentum overnight, and a range of only 30 pips. Despite this, the swissy managed to advance against the euro, sending the Eur/Chf exchange rate slightly below the 1.5100 area, the same place where the SNB intervened to devalue the Swiss franc. The yen (Usd/Jpy 90.95) was the only pair that managed to develop a trend during the overnight session, even though the range is only 50 pips. The yen’s downtrend comes as the BoJ announced that it would end the corporate debt-buying program at the end of the current year. Trade Plan of the Day: TheLFB Trade Plan is Usd/Jpy, one of the six that are available to members on the major pairs each day, plus four Jpy based cross pairs, plus S&P futures, oil, gold, and the dollar index.

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