Currency Updates:
The Australian Dollar (AUD): Report showed that the early sell off in Asia session yesterday was created by a UK seller. The pair gained back to around 0.9025 as Europe session started but as the USD went bid and emerging currencies were soft, the NY bears increased pressure on the pair and had it below Asia’s low. Main focus for today will be the Capital expenditure data due at 00:30 GMT, market will be looking for the service sector to make up for big decline in mining investments.
AUD/USD: The local bids were filled, the 21 DMA (0.8947) broke and a low of 0.8944 was hit. AUD is more likely to remain heavy, key support 0.8905/25 may be tested & cleared if data comes in poor. Below 0.8905 opens tests of 50% and 61.8% Fibs of 0.8660-0.9081 which sit 0.8871 and 0.8821 respectively.
EUR/USD: The 200 hour MA which had supported EUR/USD well through February. Once cleared the slide accelerated. End of month, USD buying from corporates added pressure on it, hitting a low of 1.3662. Bear are gaining confidence as daily RSI turned down and yield spread weigh 1.3625/55 (cloud top & base, 21 & 100 DMAs in the next hurdle). If this breaks, the rally may end and 1.3475/80 may be tested.
USD/JPY: Range trading still in play, the pair initially traded lower due to the headlines from ukraine and Russia, but steady bids and support from Nikkei futures helped the pair to stay above 102.
Looking Ahead – Economic Data (GMT)
• 21:45 NZ Ext migration & visitors Jan 4.90%-prev
• 21:45 NZ Perm/long-term migration Jan 2820-prev
• 21:45 NZ Trade – imports Jan f/c 3.90b, 4.24b-prev
• 21:45 NZ Trade balance mm Jan f/c 216.0m, 523.0m-prev
• 21:45 NZ Trade balance yy Jan f/c 0.25b, -0.26b-prev
• 21:45 NZ Trade – exports Jan f/c 4.09b, 4.76b-prev
• 23:50 JP Foreign bond investment w/e f/c 501.5b-prev
• 23:50 JP Foreign invest JP stock w/e -279.0b-prev
• 00:30 AU Capital expenditure Q4 f/c 0.00%, 3.60%-prev
• 00:30 AU Building capex Q4 f/c 0.60%, 6.30%-prev
• 00:30 AU Plant/Machinery capex Q4 f/c 0.50%, 1.50%-prev
