Forex Morning Commentary 23rd February 2009

Forex

Gut Feeling

The market is surely very volatile and factors that are influencing the market come and go like day and night. One-minute risk aversion is the buzzword then is not, so all in all, a very difficult market. The market I think is very long of US$ and a correction is immenent, which could pull the ZAR to the 9.85 level. The trading range once again for the ZAR seems to be 9.75 to 10.40. Market must exercise caution, as the volatility is causing traders lots of anxiety, as there is a lack of direction both ways. Keep an eye on Gold over the next few months as a safe haven commodity. Gold has certainly kept it sheen with all the turmoil in the market and I see the gold price above US $ 1000.00. Importers should relook at their covering on a % basis when ZAR breaches the 10.00 level as it looks like all emerging markets will be under extreme pressure from here on in. I like to stay long of US$ below 10.0000 and sell US $ OVER the 10.20 level.

Data Releases

Tuesday            SA GDP q/q

Tuesday            US Fed Bernanke testify, Cons Down-Home Price

Wednesday       SA PPI

Wednesday       US Home Sales

Friday               SA M3, PSCEy/y, Trade Stats

Friday               US GDP, NAPM

Rates

USD / ZAR       9.9690/10.0690

EUR / ZAR       12.8500/12.8900

GBP / ZAR       14.4660/14.6160

ZAR / JPY       9.2323/9.2723

EUR / USD      1.2892/1.2902

GBP / USD      1.4512/1.4522

USD / JPY       92.99/93.09

Morning Commentary