Asian Session Recap January 14th

By: Alex Brandt
AUD/USD - Stronger Employment
USD/CAD - Virtually unchanged
EUR/CHF @ 1.4790

News Events on Deck
ECB Interest Rate - Market Expectations: 1%
US Retail Sales - Market Expectations: .40%

Stronger employment data from Australia beat market expectations, resulting in the AUD/USD spiking to .9293 on the news. With a stronger economic report released, I believe that the AUD/USD will reach .9350 by the end of the week as traders become more confident that the Australian RBA will raise rates in February. The EUR/CHF steadily appreciated over the course of the past session, with some strong bids to the start of the European session. I believe the pain threshold for the SNB is 1.4700, if price falls below that then I would expect the SNB to strongly intervene. Volatility has decreased in the Forex over the last few weeks, enabling the EUR/USD to reach a three week high. For the rest of the week, I think that the dollar will weaken as positive economic data from other countries will fuel risk appetite for higher yielding currencies as traders lower their expectations for a federal reserve hike in 2010.