[IMAGE] Forums Discuss these points in the Forums:  Forexnews Forum       Technicals Live Charts Analysis available from: Cornelius Luca   J.P. Chorek   Technical Research Ltd.   Charts & News featuring Standard & Poor's       Interest Rates   US: Japan: Eurozone: UK: Switzerland:   1.75%  0.15%  3.25%  4.0%  1.25-2.25%       [IMAGE] 	 [IMAGE]  USD/JPY Hits New 3-Year High Above 133  January 9, 7:00 AM: EUR/$..0.8929 $/JPY..132.31 GBP/$..1.4414 $/CHF..1.6569  USD/JPY Hits New 3-Year High Above 133 by Jes Black  No Key Data  The dollar kept pressure on the yen today, driving it to a new 3-year low of 133.37 in Tokyo before falling back to support around 132.20 in European trade. Again, the Japanese were main sellers of yen after Monday's corrective buying gave way to a 2% sell-off over the past two trading days. The euro also rose by the same amount, but has failed to reach new highs since its 2-year peak of 119.71 last week. Meanwhile, USD was relatively unchanged in London trade against the euro and sterling but added to overnight gains against the Swiss franc.  The market continued to react to overnight comments by Japanese monetary officials that showed their acceptance of a weaker yen. Japan's top financial diplomat, Kuroda, said on Wednesday that the country's FX policy remained unchanged despite the yen's rapid 10% decline over the past 2 months. Economics Minister Takenaka also said late last night that following his meetings with US economic officials he saw the US economy rebounding more quickly than previously thought and that weakness in JPY was not "far off economic fundamentals" for the struggling Japanese economy. Although Takenaka later admitted that he did not discuss FX levels with US officials, his comments carried with it the implicit impression that the US was fine with a weaker yen  Japanese officials are now likely to remain quiet ahead of PM Koizumi's 7-day tour around southeast Asia which begins today. Although US monetary officials have expressed a desire to let markets determine FX rates, countries such as China and Korea have voiced concern about Japan exporting their deflation to the rest of the area. In the absence of further encouragement and the fact that JPY is technically oversold a period of consolidation would not be unusual. But any correction in USD/JPY would likely hold around 130-132 dealers say.   CHF fell on the back of a further rise in Swiss unemployment to 2.4% in December from 2.1% in November. This showed the labor market coming under increased pressure as economic weakness permeates the economy. But markets paid more attention to Swiss National Bank Vice-Chairman Gehrig who reportedly said in an interview that the SNB's next move could be either up or down. This surprise comment caught markets off guard and given that the economy should show flat growth in H2 2002, as well as the central bank's dissatisfaction with the current strong CHF exchange rate, traders sold the franc versus the euro and dollar.  USD/CHF rose to a new high of 1.6591 in European trade after breaking key resistance at 1.6575/80. The dollar's renewed strength since touching uptrend support at 1.6350 last week has been bullish for the pair and next resistance is seen at 1.6650 and 1.6680. Support is seen at 1.6510 and 1.6475. EUR/CHF also rose to a high of 1.48.  Meanwhile, the dollar hovered in a tight range against the euro and sterling as both EUR/USD and GBP/USD showed little decisive price action.  EUR/USD tested key support at 89.10, which marks the 50% Fibonacci retracement of the move from 82.25 to 95.96. Overnight, the pair briefly tested resistance at 89.50, but was rejected. Now, failure to maintain above 89.10/20 would probably call for a test lower to 87.60/40. Looking at the hourly chart, EUR/USD has traded neatly within the 38.2% and 61.8% Fibonacci retracement levels of the move from 82.25 to 95.96. These levels are 90.72 and 87.64 respectively and were tested on December 17, 25 and most recently on January 2 when the single currency reached a high of 90.63.  GBP/USD also looks weak as resistance at 1.4440 has proved hard to break. Cable's position has worsened since failing to break through resistance at 1.4547 on January 2. This level marks the 61.8% Fibonacci retracement of the move from 1.51 to 1.3680. Cable is now trading at a day's low of 1.4388, which also marks the 50% retracement of the same move. A close below this level would target 1.4360, followed by 1.4340, 1.4300 and 1.4250. Resistance is eyed at 1.4440, 1.4480, 1.450 and 1.4550.  In the UK, attention continues to center around that debate and the dilemma now faced by the Bank of England over whether or not to ease rates for the struggling manufacturing sector in light of robust consumer spending. The BoE's monetary policy committee meeting on Thursday is expected to leave rates unchanged at 4.0%. However, unexpectedly strong consumer spending released last week prompted BoE Governor George to express some concern, saying that if demand did not abate the central bank would raise rates as soon as the economy recovered.   EUR/GBP also fell to a day's low of 61.88. Support at 61.70 should maintain, but the high of 62.80 reached on January 2 in the wake of europhoria and renewed EMU debate could be seen as a selling opportunity say dealers who see strength in euro abating.   Meanwhile, the single currency's prospects were also hurt by rising fears in Argentina over the possible collapse of the new economic plan, given that the euro is the most exposed of the major western currencies. In addition, the Eurozone business climate indicator fell to -1.23 in December from -1.20 in November, for a 10th consecutive month, and to the lowest since July 96.  Also worrisome was the fact that E-12 Q3 labor costs rose 3.3%, more than the previous 2.7% in Q3 and above expectations of  2.6%.  	[IMAGE] Audio Mkt. Analysis Officials Drive Down JPY, CHF       Articles & Ideas  What's Next For the Euro?   A Look Back at 2001, Forex Themes for 2002       Articles & Ideas Forex Glossary   Economic Indicators   Forex Guides   Link Library      [IMAGE] 	
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