Strong recovery in the US dollar after Oil and Gold fall steeply
CURRENCY TRADING SUMMARY – 28th MAY 2008 (00:30GMT)
·U.S. Dollar Trading (USD) gained against all the majors on the back of heavy commodity sales. Helping the greenbacks cause was New home Sales for April, which came in higher then forecasted, rising 3.3% to 526,000 after March’s figure was downwardly revised to 509,000. Other data out yesterday included Standard & Poor’s Case-Shiller index of National Home Prices falling a record 14.1% yearly for the first quarter. In other news, the Conference Board’s Consumer confidence Index fell to a 16 year low of 57.2 for May. In US share markets the NASDAQ was up 36.57 points (1.5%) and the Dow Jones was up 68.72 points (.55%). Comments from Russia that it will increase production, ensured Crude oil fell by $3.34, closing the New York session at $128.85 per barrel. Looking ahead, Core Durable Goods Orders for the month of April is out today, widely expected to come in at -0.5% (Previous: -0.9%)
·The Euro (EURO) was hurt from the commodity sell off and poor German consumer confidence (actual 4.9 vs. 5.7 expected). German GDP was confirmed at 1.5% q/q as anticipated. Overall the EURUSD traded with a low of 1.5682 and a high of 1.5819 before closing the day at 1.5702 in the New York session. Looking ahead, the European Current Account comes out tonight.
·The Japanese Yen (JPY) was sold heavily today as the equity markets recovered. The USD/JPY regained the 104 handle and most of the crosses made fresh gains. USDJPY traded with a low of 103.27 and a high of 104.33 before closing the day around 104.25 in the New York session.Quiet day on the data front although Bank of Japan Governor Shirakawa is due to speak.
·The Sterling (GBP) tracked the euro, edging lower against a broadly stronger dollar with little data out of the UK. Overall the GBPUSD traded with a low of 1.9715 and a high of 1.9847 before closing the day at 1.9815 in the New York session. Quiet data today, Nationwide House Prices tomorrow.
·The Australian Dollar (AUD) did well to hold its own in the face of USD strength and gold sell off, AUDJPY was very bid trading above the 100 level. Overall the AUDUSD traded with a low of 0.9580 and a high of 0.9633 before closing the day at 0.9583 in the New York session. Looking ahead, Construction work done expected to come in at 2.3%.
·Gold (XAU) fell heavily on broad commodity sell off ending down 1.9%. Overall trading with a low of $903.3 and high of $929.5 ending the New York session at $907.90.
TECHNICAL COMMENTARY
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.5504 |
1.5631 |
1.5685 |
1.5180 |
1.5846 |
|
USD/JPY |
101.91 |
102.58 |
104.30 |
104.38 |
104.48 |
|
GBP/USD |
1.9614 |
1.9684 |
1.9755 |
1.9870 |
1.9881 |
|
AUD/USD |
0.9511 |
0.9546 |
0.9565 |
0.9655 |
0.9723 |
|
XAU/USD |
901.00 |
904.20 |
906.70 |
935.40 |
953.00 |
·Euro – 1.5685
Initial support at 1.5631 (May 21 low) followed by 1.5504 (May 20 low). Initial resistance is now located at 1.5814 (May 22 high) followed by 1.5846 (76.4% retracement 1.5284-1.5814)
·Yen – 104.30
Initial support is located at 102.58 (May 12 low) followed by 101.91 (38.2% retracement of 95.76-105.71). Initial resistance is now at 104.38 (May 22 high) followed by key 104.48 (May 20 high).
·Pound – 1.9755
Initial support at 1.9684 (May 22 low) followed by 1.9614 (May 21 low). Initial resistance is now at 1.987 (76.4% retracement of 2.00027-1.9363) followed by 1.9881 (50% retracement 2.0398-1.9393).
·Australian Dollar – 0.9565
Initial support a 0.9546 (May 22 low) followed by 0.9511 (May 19 low). Initial resistance is now at 0.9655 (May 21 trend high) followed by 0.9723 (open this week + range last week*0.618).
·Gold – 907
Initial support at 904.2 (May 27 low) followed by 901 (May 19 low). Initial resistance is now at 935.4 (May 22 high) followed by 953.0 (Apr 17 high).
