USD Strengthens After FOMC
CURRENCY TRADING SUMMARY – 29th January 2009 (00:30GMT)
·U.S. Dollar Trading (USD) was sold most the day as equities around the world rallied on news that the Obama Administration would be looking to create a bad bank to hold toxic assets. The losses were reversed after guidance from the FOMC that buying of US treasuries from the FED was not a sure thing. Crude Oil closed up $0.35 ending the New York session at $41.93 per barrel. In US share markets, the Dow Jones gained 200 points or 2.46% and the NASDAQ gained 53 points or 3.55%. Looking ahead, December Durable Goods are expected to drop -2% vs. -1.5% previously. Also released, December New Homes Sales are forecast at 0.4m vs. .407m previously.
·The Euro (EUR) retested the 1.33 key level but was rejected quite violently as the FOMC statement helped the USD. Weighing intraday was weaker than expected German CPI in January at -0.5% vs. -0.3% forecast. Overall the EUR/USD traded with a low of 1.3104 and a high of 1.3328 before closing the day at 1.3160. Looking ahead, German Unemployment is forecast at 7.7% vs. 7.6% previously in January. Eurozone December Private loans is forecast at 6.5% vs. 7.1%.
·The Japanese Yen (JPY) was sold across the board as risk sentiment improved and the market bought up high yielding currencies. USD/JPY jumped above 90 as Equities rallied into the US session and extended gains after the FOMC minutes. Overall the USDJPY traded with a low of 88.91 and a high of 90.76 before closing the day around 89.20 in the New York session. UPDATE Japan Retail Sales dropped -2.7% vs. -1.6% forecast.
·The Sterling (GBP) pushed higher after tripping stops above 1.4250. The market was very bullish and tested supply at 1.4350 that held until the late USD forced some profit taking. Overall the GDP/USD traded with a low of 1.4128 and a high of 1.4374 before closing the day at 1.4240 in the New York session. Looking Ahead, January House Prices are forecast to fall -1.7% vs. -2.5% previously, expecting a -16.7% Y/Y drop.
·The Australian Dollar (AUD) tracked the Euro higher in a move that has recently seen the AUD dubbed the ‘fast Euro’. Selling interest above 0.6700 proved strong headwind the pair slumped back to low 0.66 after the FOMC statement. AUD/NZD jumped higher to 1.27 as the market Dumped the NZD after the RBNZ cut rates by 1.5% in early Asian trading. Overall the AUD/USD traded with a low of 0.6597 and a high of 0.6730 before closing the US session at 0.6660.
·Gold (XAU) paused at the $900 an ounce level while the market continued to consolidate the recent rally. Overall trading with a low of USD$883 and high of USD$903 before ending the New York session at USD$888 an ounce.
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.2862 |
1.3103 |
1.3175 |
1.3330 |
1.3386 |
|
USD/JPY |
87.13 |
87.99 |
90.25 |
90.76 |
90.97 |
|
GBP/USD |
1.3549 |
1.3929 |
1.4268 |
1.4443 |
1.4909 |
|
AUD/USD |
0.6418 |
0.6495 |
0.6670 |
0.6732 |
0.6844 |
|
XAU/USD |
844.50 |
852.90 |
888.00 |
916.00 |
930.00 |
·Euro – 1.3175
Initial support at 1.3103 (Jan 27 low) followed by 1.2862 (Jan 26 low). Initial resistance is now located at 1.3330 (Jan 27 high) at followed by 1.3386 (Jan 19 high)
·Yen – 90.25
Initial support is located at 87.99 (Jan 23 low) followed by 87.13 (Projected downside target). Initial resistance is now at 90.76 (Jan 28 high) followed by 90.97 (Jan 20 high).
·Pound – 1.4268
Initial support at 1.3929 (Jan 27 low) followed by 1.3549 (Jan 26 low). Initial resistance is now at 1.4443 (Jan 20 high) followed by 1.4909 (Jan 19 high).
·Australian Dollar – 0.6670
Initial support at 0.6495 (Jan 26 low) followed by the 0.6418 (Jan 23 low). Initial resistance is now at 0.6732 (Jan 28 high) followed by 0.6844 (Jan 19 high).
·Gold – 888
Initial support at 852.90 (Jan 23 low) followed by 844 (Jan 22 low). Initial resistance is now at 916.1 (Jan 26 high) followed by 930 (Oct 10 high).
