Cornelius Luca //
New York, August 30 (BridgeNews) - The euro opened the U.S. session virtually unchanged versus the dollar and slightly lower against the yen as traders are waiting for the European Central Bank decision on interest rates. Economists surveyed by BridgeNews were roughly evenly split as to whether the ECB will deliver a cut to the currently 4.5% repo rate at its council meeting Thursday.

The ECB is due to launch euro notes and coins at the press conference, and the central bank might not wish this event to be overshadowed by a rate cut. However, recent euro-zone data underlined the need for an economic stimulus, while relatively tame inflation opened the doors for an easing.
Dollar/Swiss franc, sterling/dollar and dollar/Canada all marked time within recent ranges. Dollar/yen edged lower within Wednesday's range, extending its consolidation within the range of Aug. 15.
The U.S. July personal income and spending data should not generate much interest in the pre-long weekend market, but traders will carefully watch state unemployment claims for week ended Saturday.

Current Previous Change Global Global
NY open NY close low high

USD/JPY 119.74 120.18 -0.44 119.55 120.26
EUR/USD 0.9086 0.9093 -0.0007 0.9057 0.9100
EUR/JPY 108.80 109.27 -0.47 108.56 109.25
GBP/USD 1.4535 1.4503 0.0032 1.4486 1.4543
USD/CHF 1.6700 1.6692 0.0008 1.6676 1.6740
USD/CAD 1.5459 1.5451 0.0008 1.5452 1.5465
AUD/USD 0.5289 0.5288 0.0001 0.5283 0.5312

One day after rebounding from a two-week low of 119.08, USD/JPY declined slightly within Wednesday's range. The pair will continue to trade around the 119.65 Gann 50-point pivot, which targets 119.15 and 120.15.
Traders shrugged off Bank of Japan Governor Masaru Hayami's remarks that it was desirable for foreign exchange rates to be stable, reflecting economic fundamentals. He said the recent weakness of the U.S. dollar was due to the slowing of the U.S. economy.
Japanese fundamentals continued to paint a bleak economic picture, but the market has already priced them in.
Seasonally adjusted industrial and mining production fell 2.8% in July from June. The July data were worse than private economists' average outlook of a 2.1% fall. METI's survey also showed that output is expected to rise 4.3% in August and to decrease 3.0% in September.
In addition, sales at large Japanese retail stores fell 3.0% from a year ago in July, following a 1.9% decline in June.
The intraday outlook is mixed.

Support: 119.65 (Gann 50-point pivot; targets: 119.15/120.15), 119.55 (overnight low), 119.08 (Aug. 29 low), 119.05 (Aug. 15 low; 2-month low), 119.00 (38.2% Fibonacci retracement level of the August 1998-December 1999 downtrend), 118.30 (June 1 low; 3-month low), 118.25 (Gann 50-point pivot; targets: 117.75/118.75).
Resistance: 120.26 (overnight high), 121.05 (Gann 50-point pivot; targets: 120.55/121.55), 121.18 (20-day moving average), 122.50 (Gann 50-point pivot; targets: 122.00/123.00), 122.54 (100-day moving average), 123.03 (60-day moving average).

EUR/USD bounced from a 2-day low of 0.9057 but remained fairly close to the support of the rising 20-day moving average at 0.9036. Key levels to watch are 0.9028 and 0.9149.
German and Italian data failed to alter the market's focus on the ECB rate decision.
German wholesale sales in July fell a real 0.2% and rose a nominal 1.7% on the year. In the January-July period, wholesale sales were 0.4% lower than a year ago in real terms and 2.9% higher in nominal terms. In the monthly, seasonally and calendar-adjusted comparison, wholesale sales were down nominal 5.7% in July from June.
Italian June retail sales grew at the fastest rate since September 2000, advancing 2.9% compared to the same period last year. Meanwhile, Italy's government is considering almost halving pension fund gains tax to 6% from 11%, in an attempt to stimulate the country's underdeveloped private pension system. The document also centers on further liberalizing the energy market, in an effort to reduce energy costs.
The outlook depends on the ECB's rate decision.

Support: 0.9057 (overnight low), 0.9036 (20-day moving average), 0.9028 (Aug. 28 low), 0.8963 (50% Fibonacci retracement level of the June-October downtrend), 0.8941 (200-day moving average).
Resistance: 0.9100 (overnight high), 0.9136 (61.8% Fibonacci retracement level of the June-October downtrend), 0.9240 (Aug. 22 high; 5-month high), 0.9382 (March 2 peak), 0.9446 (Feb. 1 peak), 0.9595 (Jan. 5 high; six-month peak).

Just like USD/JPY, EUR/JPY slipped within Wednesday's range, when it marked a 3-week low of 108.35. The cross remains below its 20-day moving average at 109.47.
The outlook is mixed.

Support: 108.56 (overnight low), 108.35 (Aug. 29 low), 107.28 (100-day moving average), 107.57 (60-day moving average), 107.10 (200-day moving average), 105.80 (38.2% Fibonacci retracement level of May 1999-October 2000 downtrend), 104.54 (June 20 low).
Resistance: 109.25 (overnight high), 109.47 (20-day moving average), 110.63 (Aug 20 high; 3 1/2-month peak), 111.02 (50% Fibonacci retracement level of May 1999-October 2000 downtrend), 113.71 (April 4 high; 17-month high).

GBP/USD rebounded into positive territory from a 2-day low of 1.4486.
Consumer lending rose sharply in July and mortgage lending was also strong, despite concerns the economy may be slowing. Consumer credit lending rose to 1.69 billion sterling ($2.46 billion), from 1.36 billion in June, and mortgage lending rose to 4.45 billion sterling, from 4.3 billion.
Resistance is seen at 1.4560 from the 61.8% Fibonacci retracement of the January-June downtrend, at 1.4569 from the Aug. 29 high, and at 1.4584 from the Aug. 22 high, which is a 5-month peak.
The outlook is slightly bullish.

Support: 1.4486 (overnight low), 1.4371 (20-day moving average), 1.4224 (100-day moving average), 1.4193 (60-day moving average), 1.3911 (June 20 low), 1.3688 (June 12 low; 15 1/2-year low), 1.3660 (February 1986 trough).
Resistance: 1.4543 (overnight high), 1.4560 (61.8% Fibonacci retracement of January-June downtrend), 1.4569 (Aug. 29 high), 1.4584 (Aug. 22 high; 5-month high), 1.4756 (March 2 peak), 1.5100 (Jan. 8 peak, year high).