World Bank expects World Recession
CURRENCY TRADING SUMMARY – 10th March 2009 (00:30GMT)
·U.S. Dollar Trading (USD) continued to test its strength against nearly all currencies as the new week offered little hope to investors. The World Bank said that the Global economy might shrink this year as the financial crisis intensifies. Stocks were once again weak but Oil managed to surge on continued OPEC cut speculation. Crude Oil closed up $1.55 ending the New York session at $47.07 per barrel. In US share markets, the Nasdaq was down 25 points or -1.95% whilst the Dow Jones fell 78 points or -1.21%. Looking ahead, Bernanke Speaks on Financial Reform.
·The Euro (EUR) early strength in Asia was reversed as stocks were unable to sustain gains and the Dollar strengthened. March Eurozone Sentix slumped to -42.7 vs. -36 previously as investor confidence waned. EUR/JPY and EUR/GBP buying supported. Overall the EUR/USD traded with a low of 1.2558 and a high of 1.2725 before closing the day at 1.2610. Looking ahead, February CPI forecast at 0.6% vs. -0.5% previously m/m. German January Trade Balance is forecast at 10Bln vs. 10.7Bln previously.
·The Japanese Yen (JPY) strengthened after the current account went into deficit for the first time in 13 years at -125Bn Yen. The weak data inspired Yen weakness as the market focuses on Japanese Economic data rather than equity markets for direction. Overall the USDJPY traded with a low of 97.96 and a high of 99.17 before closing the day around 98.80 in the New York session. Looking ahead, January Leading Indicators previously at -2.
·The Sterling (GBP) had a major break to the downside after support at 1.4000 gave way given part nationalization of Lloyds bank and speculation that BOE quantitative easing will flood the market with Pounds. Overall the GBP/USD traded with a low of 1.3745 and a high of 1.4179 before closing the day at 1.3785 in the New York session. Looking ahead, Industrial Production forecast at -1.2% vs. -1.7% previously.
·The Australian Dollar (AUD) was sold all day as the lack of risk appetite and USD strength push the pair back towards the bottom of the recent 0.6300-0.6500 range. Strong Oil was offset by weak copper and Gold prices. Overall the AUD/USD traded with a low of 0.6309 and a high of 0.6448 before closing the US session at 0.6325. Looking ahead, Business Confidence previously at -32.
·Gold (XAU) Gave back some of its recent rally off $900 as the market took profit and US bank stocks rallied. Overall trading with a low of USD$912 and high of USD$941 before ending the New York session at USD$920 an ounce.
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.2457 |
1.2533 |
1.2605 |
1.2754 |
1.2811 |
|
USD/JPY |
96.36 |
96.58 |
98.95 |
99.68 |
100.57 |
|
GBP/USD |
1.3503 |
1.3548 |
1.3785 |
1.4305 |
1.4385 |
|
AUD/USD |
0.6249 |
0.6281 |
0.6335 |
0.6471 |
0.6528 |
|
XAU/USD |
891.00 |
900.00 |
920.00 |
958.00 |
963.00 |
·Euro – 1.2605
Initial support at 1.2533 (Mar 6 low) followed by 1.2457 (Mar 4 low). Initial resistance is now located at 1.2754 (Mar 6 low) at followed by 1.2811 (Feb 26 high)
·Yen – 98.95
Initial support is located at 96.58 (Mar 6 low) followed by 96.36 (Feb 25 low). Initial resistance is now at 99.68 (Mar 5 high) followed by 100.57 (Nov 4 high).
·Pound – 1.3785
Initial support at 1.3548 (Jan 26 low) followed by 1.3503 (Jan 23 low). Initial resistance is now at 1.4305 (Mar 6 high) followed by 1.4385 (Feb 26 high).
·Australian Dollar – 0.6335
Initial support at 0.6281 (Mar 3 low) followed by the 0.6249 (Feb 2 low). Initial resistance is now at 0.6471 (Mar 6 high) followed by 0.6528 (Mar 4 high).
·Gold – 920
Initial support at 900 (Mar 4 low) followed by 891 (Feb 9 low). Initial resistance is now at 958 (Mar 2 high) followed by 963 (Feb 27 high).
