Market Outlook

As the new year for 2011 have kicked-off with the US dollar Index opening slightly higher from its previous 2010 lower closing price of 78.95; the opening in the Asian Trading session have led the rest of the major to follow-suit with a slight correction as well. A continuation of the corrective moves on the US dollar could be foreseen as the trading range of 78.65-80.82 were in fact the average true range of the USDX based from its previous levels of last month prior to the closing of the year. the 78.65 should be carefully watched as new positions and strategies would be in place this week as the European and US trading sessions would take place prompting the USD to be on the defensive for the start of the trading week in spite of a firm tone. And the previous week's report on china's rate hike with some friendlier reports on the US at the closing of the year.

Meanwhile, the recovery of the Euro and the GBP versus the USD at 1.3423 high and 1.5665 high from last week's price movement have found some corrective levels respectively at the start ofthe new trading week. A slower pace of volume trading as we move forward to this week may prove to be a wait & see attitude for some traders to try to find some direction for the market. And so does the USDJPY & the USDCHF at thier stronger levels to start with the year.

The precious metals have weighed heavier as the Gold prices continued its acceleration above the US$1400.00/oz. which have taken a toll on the USD and has capped its levels at the 81.45/50 basis point for the USDX. For the USD to continue heading North a conservative volume build up should be seen on the first quarter of the year's trading. Otherwise, the a re-test of the lows beyond the 78.65 would be made making the Australian and NZ Dollar a little bit more attractive.

Please visit our site for a continuation of this report at mid-week of the trading period.

http://www.megatrade101.com/