Rumors of Chinese Revaluation are circulating (!)

EUR/USD - The EuroZone has been racked by horrible numbers of late - with yesterday's German Factory Orders fall of -1.5% for August the latest in a run of bad data. Some are speculating that Trichet will tone down his recently hawkish rhetoric. In fact, it's amazing to witness the rose-tinted view of the future that most central banks are spouting these days. Any turn to dovishness by Trichet may already be priced in, however. Trading could get volatile around Trichet's press conference at 12:30 GMT. The 1.2250 area is still key support, a break of which brings us fully back into the multi-month range. A rise through the key upside swing level of 1.2350 is preferred, as it brings on the likelihood of a retest of the 1.2440 top and then a possible break of that top and beginning of a new bull market to 1.2900 and beyond.

GBP/USD - was a roller coaster yesterday as it was first heavily bid on a bigger than expected increase in housing prices and then offered on a huge drop in industrial and manufacturing production numbers. The 1.7750 low from yesterday is support in this heavily oversold currency pair. Use that area as a stop on long positions. A return to above 1.7850 helps the bullish case and a break of 1.7950 aids it further - but a return to 1.8050 is needed before the chart attains bullish credentials.

AUD/USD - Has a well-defined and tight consolidation area between 0.7190 support and 0.7250 resistance. AUD/USD appears to be gearing up for a break of the 0.7285 area top and a try at 0.7350 resistance.

EUR/JPY - did find support above the 136.25 area mentioned yesterday. Prefer the long side with stops at 136.30 offered. A break of the 137.55 area top may bring on a test of 139.00.