Daily Analysis for TUESDAY - JULY 17th

Overnight News Bullets

• GE Consumer Price Index MoM/YoY (JUN) out at 0.1%/1.8%, while 0.1%/1.8% expected, 0.1%/1.8% prior.
• NO Trade Balance (JUN) out at 25.3B, while 26.1B expected, 27.0B prior.
• NO Exports (JUN) out at 64.3B, while 66.4B prior.
• NO Imports (JUN) out at 39.0B, while 39.4B prior.
• DCLG UK House Prices YoY (MAY) out at 10.9%, while 11.2% expected, 11.3% prior.
• EC Euro-Zone CPI MoM/YoY out at 0.1%/1.9%, while 0.1%/1.9% expected, 0.2%/1.9% prior.
• EC Euro-Zone CPI Core YoY (JUN) out at 1.9%, while 1.9% expected, 1.9% prior.
• CA Manufacturing Shipments MoM (MAY) out at -0.1%, while 0.2% expected, -0.6% prior.
• CA New Motor Vehicle Sales MoM (MAY) out at -0.8%, while 0.0% expected, 6.9% prior.
• US Empire Manufacturing (JUL) out at 26.5, while 18.0 expected, 25.8 prior.
• JN Tertiary Industry Index MoM (MAY) out at -0.1%, while 0.2% expected, 1.7% prior.
• AU Preliminary BoP Imports MoM (JUN) out at 1.0%, while -16.9% expected.
• JN Tokyo Condominium Sales YoY (JUN) out at -10.9%, while -16.9% expected.

Markets

• FX: JPY strength, USD range bound ahead of US data. EUR marginally weaker, but remains range bound.

O/N Data Heat map:

EU	US	JP	UK	SZ	AU	CA	NZ	NO	SE	FR
	+	-				-

Calendar

Today's Highlights:

This and Next Week’s Highlights:

Date	Region	Release
18 July	AU	Westpac Leading Index.
18 July	JN	Leading Economic Index, Coincident Index, Machine Tool Orders, All Industry Activity Index.
18 July	UK	BoE Minutes, Claimant Count Rate, Jobless Claims Change, Avg. Earnings inc. bonus 3M/YoY, Avg. Earnings ex. Bonus 3M/YoY, ILO Unemployment Rate 3mths, Manual Unit Wage Costs 3mths.
18 July	EC	Euro-Zone Trade Balance, Construction Output.
18 July	US	MBA Mortgage Applications, A string of CPI’s, Housing Starts, Building Permits, Bernanke speaks on the U.S. Economy , DOE U.S. Crude Oil Inventories.
18 July	CA	A string of CPI’s , Leading Indicators.
19 July	AU	RBA Foreign Exchange Transactions (JUN).
19 July	JN	Nationwide Department Store Sales , Tokyo Department Store Sales.
19 July	GE	Producer Prices.
19 July	UK	Retail Sales , Public Finances (PSNCR), Public Sector Net Borrowing, M4 Money Supply, M4 Sterling Lending, BSA Mortgage.
19 July	SZ	Trade Balance, ZEW Survey (Expectations) .
19 July	US	Initial Jobless Claims, Continuing Claims , Leading Indicators, EIA Natural Gas Storage Change, Minutes of June 28 FOMC Meeting.
19 July	CA	Wholesale Sales , Interntional Security Transacations.
19 July	JN	Net Stocks Investment, Net Bonds Investment.

What's going on?

• Sideways was the name of the game yesterday in FX, helped by Japanese holiday. Today in Europe, UK CPI will take center stage at 8:30 GMT. Analysts estimates suggest 0.1% for the month of June, we think it is very likely we will see a reading of 0.2%, supporting a look above 2.0400 again in GBPUSD.
• Key Q2 Earnings today: (Coca Cola, Intel, Johnson & Johnson, Merrill Lynch & Yahoo)

FX

EUR	USD	JPY	GBP	CHF	AUD	CAD	NZD	NOK	SEK	PLN
+	-		+		+

FX Trading Strategies

Pair	Supp.	Resis.	Comments
EURJPY	167.50	168.50	With low vols and Fed Chairman Bernanke's testimony tomorrow on the US economy we prefer buying EURJPY on dips from 167.75 down to 167.50 for a test of recent highs. Look to trail with a 25-30 point stop.

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