*Last Updated April 12, 2006, 12:02 am

Daily report by CMC Markets

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FOREX ANALYSIS

Dollar set for volatile session as economic data picks up

April 12th - After a quiet start to the week, the US economic calendar is set to warm up today with the release of trade balance data for February and the latest oil inventory readings. Crude prices continue to climb and although they’re now sitting just off seven month highs, concern as to the possibility of US military intervention in Iran is likely to leave speculators backing oil and investors keen to start shifting some of their funds out of dollars into what may be perceived as safer havens. Expectations are that the trade deficit will be declared roughly similar to last month’s figure around the $67bn mark and if nothing else the announcement will simply lift the deficit issue back onto the agenda for many who may have been overlooking this important factor over the last couple of weeks. As a result it’s likely that we’ll see further volatility – especially in the short term – through today’s session. One point that has become clear over the last few days is that with relatively little directional information around traders are reacting to whatever news does emerge even if reversions are following fairly quickly and there’s certainly no reason to believe that behaviour will change dramatically today…

Stuart Scrase and Enis Mehmet



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