CURRENCY TRADING SUMMARY –06 MARCH 07 (23:30GMT)
- U.S. Dollar Trading (USD) strengthened against al other majors except then Yen during Monday. This was largely on the back of extended losses for emerging markets a cause for investors to further unwinding carry trades and fleeing to safe haven
US
- The Euro (EUR) remained steady against the USD with Eurozone PMI services coming in a little softer than expected at 57.5 (forecast: 57.7). Overall the Euro traded within a range of a low 1.3072 and a high of 1.3213 before closing at 1.3098. Looking ahead, GDP for the fourth quarter is set for release with markets expecting a figure 0.9% with the previous at 0.5%.
- The Japanese Yen (JPY) continued to strengthen against the Dollar and Euro as investors continued to unwind carry trades. Minister of Finance Watanabe hinted that JPY rise is not due to major unwinding of carry trades but reflects fundamentals as prompted for in latest G7 summit. Overall, the JPY traded within a low of 115.16 and a high of 116.78 before closing the day at 115.83.
- The Sterling (GBP) weakened on Monday following investors existing risky carry trades throwing the GBP lower against the EUR and the JPY whilst breaking key support levels. Overall, the GBP traded within a range of a low 1.9183 and a high 1.9447 before closing the day at 1.9223 in the
New York - The Australian Dollar (AUD) continued to slide against the USD suffering from the unwinding of carry trades, with the AUD being a high yielding currency. Overall the AUD traded within a low of 0.7704 and a high of 0.7823 before closing 0.7705 in the
New York - Gold (XAU) fell once again on Monday by US$4.20 an to ounce US$639.90 on the back of further unwinding of carry trades.
- The Turkish Lira (TRY) Overall, TRY extended recent decline as investors continued their move away from risky emerging markets
TECHNICAL COMMENTARY
| Currency | Sup 2 | Sup 1 | Spot | Res 1 | Res 2 |
| EUR/USD | 1.3016 | 1.3072 | 1.3110 | 1.3213 | 1.3261 |
| USD/JPY | 114.43 | 115.15 | 116.50 | 116.78 | 117.84 |
| GBP/USD | 1.9182 | 1.9184 | 1.9295 | 1.9450 | 1.9588 |
| AUD/USD | 0.7697 | 0.7702 | 0.7740 | 0.7826 | 0.7866 |
| XAU/USD | 626.73 | 633.50 | 642.80 | 645.05 | 656.40 |
- Euro 1.3110
Initial support at 1.3072 (Mar 5 low) followed by 1.3016 (Feb 22 corrective low). Initial resistance is now located at 1.3213 (Mar 5 high) followed by 1.3261 (Feb 27 high).
- Yen 116.50
Initial support is located at 115.15 (Mar 5 low) followed by 114.43 (Dec 5 reaction low). Initial resistance is now at 116.78 (Mar 5 high) followed by 117.84 (Mar 2 high)
- Pound – 1.9295
Initial support at 1.9184 (Mar 5 low) followed by 1.9182 (Former resistance from Nov 10). Initial resistance is now at 1.9450 (Mar 5 high) followed by 1.9588 (Mar 2 high)
- Australian Dollar – 0.7740
Initial support at 0.7702 (Mar 5 low) followed by 0.7697(Jan 31 reaction low). Initial resistance is now at 0.7826 (Mar 5 high) followed by 0.7866 (Mar 2 high).
- Gold – 643.00
Initial support at 633.50 (Feb 20 low) followed by 626.73 (Feb 8 low). Initial resistance is now at 645.05 (Feb 23 trend high) followed by 656.40 (May 18 reaction high)
