FOREX Trading Australia Daily Outlook 09/05/2005

FOREX Outlook 09/05/05 (02:00 GMT)

FOREX Trading Australia – Foreign Exchange Market Summary

US Dollar

• Dollar rallied across the board after an unexpected blockbuster Payrolls outcome as 274 K jobs were added for the month of April while the previous two months outcome were revised up. Many were caught off guard and were looking to translate the bearish bias in the stock market on to the Dollar prior to the release. While this strong report has put the recent slow growth story on the back bench, the Dollar needs a stream of positive data to push higher as oil prices are refusing to decisively break below $50 pb in spite of rising stockpiles.

Euro

· The Euro slipped back towards 1.28 post Payrolls and stabilized towards its 1.2790-1.2810 support zone which has held well for the last 3 months but the Euro is looking vulnerable for further losses. German factory orders came above expectations while the zone’s Money supply increased. Apart from its fundamental worries, politicians from across the zone have been critical of the ECB’s policies and the Bank is finding it hard to please all.

Yen

· The Yen has gone back above 105.25 on positive U.S. data and on lack of any concrete steps towards Yuan revaluation. Now that the Holiday week has passed in Asia, some position squaring is seen from sections that were expecting an announcement from the Chinese side. Offers are seen around 105.55 for this pair with U.S. Trade Balance figures on Wednesday the next focus.

Pound

· The Pound has slipped below 1.89 as apart from the strong U.S. data, call by several Labour MP’s urging Prime Minster Blair to quit early in his third term, to improve their re-election chances in the fourth term, are weighing in on the Pound. The focus shifts to today’s stream of data releases which are not expected to be Pound supportive.

Australian Dollar

· The Australian dollar is hovering around the 0.7750 support and should continue to trade within its recent range as long as 0.7710-25 support zone holds. This morning’s Job ads data has come in higher than expected but outlook for employment remains mixed and is expected to pullback from last year’s healthy numbers.

Economic Data Released

Upcoming Economic Releases

*Only key potential market moving data is mentioned, for a detailed Economic Calendar please click on the ‘Financial Calendar’ link on the web-site.

FOREX Technical Analysis

EUR/USD – Friday’s low was 1.2809 and high was 1.2962.
The pair closed at 1.2816.

Strong U.S. data has send it back towards it bottom picking mark around 1.28, mild support and buying interest exists around 1.2790-1.2805 followed by strong support around 1.2750 which targets the yearly lows for this pair. A decisive break below that mark could accelerate losses for this pair. On the upside, mild resistance exists around 1.2895 followed by a strong one around 1.2955-70 with any break above likely to bring strong selling interest.

Key resistance is seen at 1.2895 followed by 1.2975 while support starts at 1.2785 followed by 1.2725.

USD/JPY – Friday’s low was 104.53 and high was 105.09.
The pair closed at 105.04.

Since the Yuan issue has greater repercussions the Yen remained well bid and strong U.S. jobs report couldn’t break above the strong offers in the 105.25-40 zone. A break above brings strong resistance zone of 105.90-106.05 into focus. On the down side mild support continues in the 104.55-70 with a break below targeting the strong support zone at 103.90-104.15. Lack of any steps towards Yuan revaluation in the near term would hit the Yen hard.

Key Resistance is seen at 105.55 followed by 106.15 while support starts at 104.55 followed by 103.90.

GBP/USD – Friday’s low was 1.8896 and high was 1.9022.
The pair closed at 1.8898.

The pair has weakened on strong U.S. data while Blair’s reduced majority has taken some sheen of his reelection. A stream of data is released today from the U.K. with PPI, House prices & interest rate decision. Data is not expected to be Pound supportive with mild support around 1.8855. A break below will target the 1.8790-1.8810 zone which should bring in buyers.

Key Resistance is seen at 1.8955 followed by 1.9025 while support starts at 1.8855 followed by 1.8785.

Australian Dollar

AUD/USD – Friday’s low was 0.7744 and high was 0.7802.
The pair closed at 0.7750.

RBA’s monetary policy statement had mixed connotations while the strong U.S. data has seen it stabilize around 0.7750 with support around 0.7725. A break below 0.77 should bring in decent buying interest while on the upside mild resistance exists around 0.7795 while very strong resistance should continue in the 0.7825-40 zone.

Key Resistance is seen at 0.7795 followed by 0.7845 while support starts at 0.7725. followed by 0.7685.

Kunal ‘Kris’ Sharma
Forex Analyst
E-mail: kris@easy-forex.com

Australian Financial Services License 246566

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