Yen plays havoc with the currency market
CURRENCY TRADING SUMMARY – 20th February 2009 (00:30GMT)
·U.S. Dollar Trading (USD) gave up a lot of strength during the Asian and European session as profit taking set in and stocks rallied. Some of the losses were given back though as US stocks continued to slump and closed below 7500 for the first time. Oil surged over 10% on the back of a fall in US inventories and plans to cut production from OPEC. Weekly Jobless claims held steady at 627K. January PPI jumped 0.4% vs. 0.1%. Crude Oil closed up $4.86 ending the New York session at $39.48 per barrel. In US share markets, the Nasdaq was down -1.71% or -25.15 points whilst the Dow Jones gained 1.19% or -89 points. Looking ahead, January CPI is forecast at 0.3% vs. -0.8% previously.
·The Euro (EUR) bounced on the back on heavy EUR/JPY buying surging to the 120 level but weak US stocks pulled both pairs lower. Concerns persist after Germany Merkal failed to offer any concrete plans to assist banks. Overall the EUR/USD traded with a low of 1.2558 and a high of 1.2759 before closing the day at 1.2650. Looking ahead, Eurozone PMI services forecast at 35 vs. 34.4 previously.
·The Japanese Yen (JPY) continued to be sold as the market ran with multiple technical breaks and the USD/JPY pushed into month highs above 94. The Bank of Japan held as 0.1% but did downgrade the outlook for the economy for the 5th month in a row. Overall the USDJPY traded with a low of 93.32 and a high of 94.45 before closing the day around 94.20 in the New York session.
·The Sterling (GBP) surged on the back in GBP/JPY buying and EUR/GBP sales with the pound developing a bullish bias against a host of currencies. The pair did give up gains against the USD late in the US session with stocks coming back under pressure. Overall the GBP/USD traded with a low of 1.4241 and a high of 1.4447 before closing the day at 1.4280 in the New York session. January Retail Sales are forecast at -0.1% vs. 1.6% previously.
·The Australian Dollar (AUD) bounced with majors finding resistance above .6500 as the surge in Oil and continued strength in Gold supported. AUD/JPY buying has added another leg of support with the important cross providing much of the markets direction. Overall the AUD/USD traded with a low of 0.6521 and a high of 0.6387 before closing the US session at 0.6450. Looking Ahead, RBA Governor Stevens speaks before Parliament.
·Gold (XAU) consolidated recent gains under the significant resistance level of $1000 an ounce. Overall trading with a low of USD$969 and high of USD$987 before ending the New York session at USD$976 an ounce.
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.2423 |
1.2513 |
1.2675 |
1.2805 |
1.2891 |
|
USD/JPY |
91.59 |
92.09 |
94.15 |
94.47 |
94.64 |
|
GBP/USD |
1.3929 |
1.4052 |
1.4280 |
1.4471 |
1.4605 |
|
AUD/USD |
0.6249 |
0.6333 |
0.6445 |
0.6532 |
0.6577 |
|
XAU/USD |
940.75 |
961.50 |
974.00 |
986.45 |
988.00 |
·Euro – 1.2675
Initial support at 1.2423 (Nov 21 low) followed by 1.2389 (Nov 13 low). Initial resistance is now located at 1.2640 (Feb 18 low) at followed by 1.2805 (Feb 17 high)
·Yen – 94.15
Initial support is located at 92.09 (Feb 18 low) followed by 91.56 (Feb 17 low). Initial resistance is now at 94.47 (Feb 18 high) followed by 94.64 (Jan 6 high).
·Pound – 1.4280
Initial support at 1.4052 (Feb 2 low) followed by 1.3929 (Jan 27 low). Initial resistance is now at 1.4471 (Feb 17 high) followed by 1.4605 (Feb 13 High).
·Australian Dollar – 0.6445
Initial support at 0.6333 (Feb 18 low) followed by the 0.6249 (Feb 2 low). Initial resistance is now at 0.6532 (Feb 17 high) followed by 0.6577 (Feb 16 high).
·Gold – 974
Initial support at 961.50 (Feb 13 low) followed by 940 (Feb 17 low). Initial resistance is now at 986 (Feb 15 high) followed by 988 (July 15 high).
