DJ ASIA DAILY FOREX OUTLOOK -

Majors
Mon May 31 19:42:00 EDT 2010
SINGAPORE (Dow Jones)--Following are expected trading ranges and outlooks for nine major
currency pairs today:

Immediate Range Larger Range

USD/JPY 90.90-91.61 90.58-91.74
EUR/USD 1.2254-1.2334 1.2201-1.2380
AUD/USD 0.8380-0.8515 0.8200-0.8551
NZD/USD 0.6780-0.6846 0.6700-0.6861
GBP/USD 1.4442-1.4548 1.4372-1.4610
USD/CHF 1.1528-1.1596 1.1476-1.1655
USD/CAD 1.0409-1.0507 1.0328-1.0560
EUR/JPY 111.54-112.93 111.33-113.67
EUR/GBP 0.8441-0.8524 0.8419-0.8547

(Ranges are calculated using recent high and lows, information on the placement of option
strikes, and technical analysis - Fibonacci levels, trendlines and moving averages.)

USD/JPY - to consolidate, trading likely dominated by yen-crosses play as markets await RBA,
BOC interest rate decisions. USD/JPY supported by slight improvement in risk sentiment as
DAX ended up 0.31% yesterday while U.S., U.K. markets were shut yesterday for holiday; USD
demand for import settlements; anticipation for upbeat May U.S. non-farm payrolls report due
Friday (563,000 jobs increase expected vs 290,000 growth in April). But USD/JPY topside
limited by Japan exporter sales, lingering worries over European debt crisis. Data focus: 1400
GMT U.S. April construction spending, May ISM manufacturing index, 1430 GMT May Dallas
Fed manufacturing outlook survey. USD/JPY daily chart mixed as stochastics bullish, but
MACD still in bearish mode. Resistance at 91.61 (yesterday's high); breach would target 91.74
(previous base set May 17), then 91.88 (May 20 high), 92.15 (May 19 high), 92.44 (55-day
moving average) and 92.96 (May 18 high). Support at 90.90 (yesterday's low); breach would
expose downside to 90.58 (Friday's low), then 89.79 (Wednesday's low), 89.24 (May 25 low)
and 88.98 (May 20 low).

EUR/USD - to consolidate. Pair weighed by worries over euro-zone economic slowdown as

governments adopt austerity measures to trim swelling fiscal deficits; slump in euro-zone
business & consumer confidence in May (overall Economic Sentiment Indicator or ESI fell
sharply to 98.4 from 100.6 in April, vs forecast for rise to 101.0); expectations ECB unlikely to
raise its key interest rate any time soon. Data focus: 0600 GMT German April retail trade, 0755
GMT German May manufacturing PMI, 0800 GMT German May labor market statistics, euro-
zone May manufacturing PMI, 0900 GMT euro-zone April unemployment. EUR/USD daily
chart mixed as MACD, stochastics in bullish mode, but 5-day moving average meandering
sideways; inside-day-range pattern completed yesterday. Resistance at 1.2334 (yesterday's high),
then at 1.2380 (hourly chart); breach would expose upside to 1.2452 (Friday's high), then 1.2559
(May 24 high), 1.2672 (May 21 high) and 1.2684 (May 13 high). Support at 1.2254 (yesterday's
low); breach would expose downside to 1.2201 (hourly chart), then 1.2152-1.2143 band
(Thursday's low-May 19 4-year low), psychological 1.2000 and 1.1823 (Feb. 27, 2006 reaction
low).

AUD/USD - to consolidate with risks skewed higher as markets await 0430 GMT RBA interest
rate decision: bank expected to stand pat on rates after raising them in 6 of its last 7 meetings to
4.5%, but market participants will watch post-meeting statement for RBA's view on price trend
as it may give hint about timing of next rate hike. AUD/USD also supported by spillover from
CAD strength. Other data focus: 0130 GMT Australia April trade data, April building approvals,
0630 GMT Australia May commodity price index. AUD/USD daily chart positive-biased as
stochastics bullish, MACD staging bullish crossover against its exponential moving average.
Resistance at 0.8515 (yesterday's high); breach would expose upside to 0.8551 (Friday's high),
then 0.8576 (previous base set Feb. 5), 0.8637 (May 19 high) and 0.8714 (previous base set May
6). Support at 0.8380 (yesterday's low); breach would temper near-term positive outlook,
exposing downside to 0.8200 (hourly chart), then 0.8188 (Wednesday's low), 0.8065 (10-month
low set May 25) and psychological 0.8000.

NZD/USD - to consolidate with risks skewed higher. Pair supported by better risk sentiment,
Kiwi-U.S. yield gap, yesterday's sanguine NBNZ monthly business confidence report showing
confidence only dipped marginally in May from historically high levels in April; expectations
RBNZ will being increasing policy rate from 2.5% at its June meeting; spillover from CAD
strength. NZD/USD daily chart mixed as MACD bearish, but stochastics in bullish mode.
Resistance at 0.6846 (yesterday's high), then at 0.6861 (Friday's high) and 0.6876 (May 20 high);
breach would expose upside to 0.6913 (previous base set May 17), then 0.7039 (May 18 high).
Support at 0.6780 (hourly chart), then at 0.6700 (yesterday's low); breach would expose
downside to 0.6623 (Thursday's low), then 0.6602 (Wednesday's low) and 0.6559 (9-month low
set May 25).

GBP/USD - to consolidate with risks skewed higher, taking cue from movements in AUD/USD,
USD/CAD as spotlight turn on RBA, BOC rate decisions. Cable topside limited by concerns
about long period of slow UK economic growth as government fiscal tightening measures weigh,
expectations BOE unlikely to raise its key interest rate any time soon. Data focus: 0830 GMT
UK May CIPS manufacturing PMI, 1000 GMT UK April Land Registry house price index.
GBP/USD daily chart positive-biased as MACD & stochastics in bullish mode. Resistance at
1.4548 (yesterday's high); breach would expose upside to 1.4610 (Friday's high), then 1.4638
(May 14 high) and 1.4916 (May 13 high). Support at 1.4442 (hourly chart), then at 1.4372
(yesterday's low); breach would temper near-term positive outlook, exposing downside to 1.4329
(Wednesday's low), then 1.4257 (May 25 low) and 1.4230 (14-month low set May 20).

USD/CHF - to trade with risks skewed lower. Pair undermined by expectations SNB may hike
interest rate in September; but downside limited by fears of more CHF-selling intervention by
SNB. Data focus: 0545 GMT Swiss 1Q GDP, 0730 GMT Swiss May SVME PMI. Daily chart
negative-biased as stochastics bearish at overbought, MACD staging bearish crossover against its
exponential moving average. Support at 1.1528 (yesterday's low); breach would target 1.1476
(Friday's low), then 1.1447 (May 21 low), 1.1420 (May 19 low) and 1.1267 (May 18 low).
Resistance at 1.1596 (Friday's high); breach would temper near-term negative outlook, exposing
upside to 1.1655 (Thursday's high), then 1.1697 (13-month high set May 25) and 1.1740 (April
20, 2009 reaction high).

USD/CAD - to trade with risks skewed lower as markets await 1300 GMT BOC interest rate
decision. USD/CAD under pressure as BOC expected to hike policy rate by 25 bps to 0.50%.
Pair also undermined by stronger-than-expected Canada 1Q10 GDP (expanded 6.1% for fastest
rise since 4Q99, over twice as fast as U.S.); high oil prices (Nymex crude last up $1.09/bbl at
$75.06 on Globex vs Friday's $73.97 settlement). USD/CAD daily chart negative-biased as
stochastics bearish, MACD staging bearish crossover against its exponential moving average.
Support at 1.0409 (yesterday's low); breach would expose downside to 1.0328 (100-day moving
average), then 1.0240 (May 18 low), 1.0224 (55-day moving average) and 1.0105 (May 13
reaction low). Resistance at 1.0507 (hourly chart), then at 1.0560 (Friday's high); breach would
temper near-term negative outlook, exposing upside to 1.0718 (Thursday's high), then 1.0746
(Wednesday's high) and 1.0851 (7-month high set May 25).

EUR/JPY - to consolidate with risks skewed higher as RBA, BOC rate decisions eyed. Cross
supported by improved risk sentiment; but gains limited by lingering worries over euro-zone
debt crisis. Daily chart positive-biased as stochastics bullish, MACD staging bullish crossover
against its exponential moving average. Resistance at 112.93 (yesterday's high); breach would
expose upside to 113.67 (Friday's high), then 114.05 (May 24 high), 114.40 (May 21 high) and
115.49 (May 18 high). Support at 111.54 (yesterday's low), then at 111.33 (Friday's low); breach
would temper near-term positive outlook, exposing downside to 110.40 (hourly chart), then
109.19 (Thursday's low), 108.83 (8.5-year low set May 25) and 106.76 (Nov. 8, 2001 reaction
low).

EUR/GBP - to range-trade. Daily chart mixed as stochastics in bearish mode, MACD neutral.
Support at 0.8441 (yesterday's low), then at 0.8419 (Thursday's low); breach would target 0.8397
(June 22, 2009 reaction low), then 0.8230 (Nov. 27, 2008 reaction low). Resistance at 0.8524
(yesterday's high), then at 0.8547 (Friday's high); breach would expose upside to 0.8585 (May 25
high), then 0.8674 (May 24 high), 0.8773 (May 21 high) and 0.8807 (May 7 high).

Disclaimer
(This article is general financial information, not personalized investment advice, as it does not
consider the unique circumstances affecting an individual reader's decision to buy or sell a
specific security. Dow Jones does not warrant the accuracy, completeness or timeliness of the
information in this article, and any errors will not be made the basis for any claim against Dow
Jones. The author does not invest in the instruments or markets cited in this article.)