Sentiment is quite positive for the dollar. We are breaking levels so short term there is momentum. Fundamentally we are looking at interest rates.

People are looking at today's housing data just to see if a drop in the existing number is actually true or not. Some people like to look at housing data as a leading indicator.

Some people like to look at housing data as a leading indicator.

Our base case is that they (Fed) will go to five percent this quarter and then pause. There is a risk that they could do one more, but we're sticking with five percent.

To some extent people are paring back positions ahead of a very busy data afternoon.

Today's data should confirm the overall relatively constructive picture for the U.S. in 2006, we're looking for the Fed to go to 5 percent (on rates).