US GDP Drops -6.1% in Q1
CURRENCY TRADING SUMMARY – 30th April (00:30GMT)
·U.S. Dollar Trading (USD) weakened substantially on the back of solid equity markets. Q1 GDP was worse than expected at -6.1% vs. -4.9% forecast. The FOMC also met and held rates at the 0-0.25% target range. Helping support sentiment was the FOMC statement that included ‘the pace of contraction appears to be somewhat slower’ which added to bottoming speculation. Crude Oil up $1.03 ending the New York session at $50.60 per barrel. In US share markets, the Nasdaq was up 38 points or 2.28% and the Dow Jones was up 168 points or 2.11%. Looking ahead, Weekly Jobless Claims forecast at 643k vs. 640K. Core PCE (March) forecast at 0.2% vs. 0.2% previously.
·The Euro (EUR) continued to rise rapidly as sentiment improved and Eurozone confidence improved. Of concern was German GDP Growth was downgraded to -6.0% vs. -2.25% initially. The pair rallied to above 1.3300 before easing into the US close. Overall the EUR/USD traded with a low of 1.3122 and a high of 1.3340 before closing at 1.3260. Looking ahead, April German Unemployment Rate forecast at 8.3% vs. 8.1% Previously.
·The Japanese Yen (JPY) was sold all day as Japan was away on holidays and sentiment/stocks improved. USD/JPY tested 98 on the topside and EUR/JPY reclaimed 130 after trading at 125 just 2 days ago. Industrial Production (March) rose 1.6% but the Jan-March Quarter was the steepest drop on record. Overall the USDJPY traded with a low of 95.65 and a high of 96.65 before closing the day around 96.50 in the New York session. Looking ahead, BOJ Rate Decision forecast to remain 0.1%.
·The Sterling (GBP) tracked the EURO higher with the GBP/JPY especially buoyant. EUR/GBP remained in a tight range which underpinned the relationship of the majors. Overall the GBP/USD traded with a low of 1.4635 and a high of 1.4812 before closing the day at 1.4750 in the New York session. Looking ahead, April Nationwide House prices are forecast at -1.3% vs. 0.9% previously.
·The Australian Dollar (AUD) broke higher towards the upper end of the 0.70-73 range on the back of heavy AUD/JPY buying which reclaimed the 70 Yen level. AUD/NXD shot higher this morning in Asia as the RBNZ cut rates by 0.5% and cautioned markets that rates were to remain low for some time. Overall the AUD/USD traded with a low of 0.7071 and a high of 0.7300 before closing the US session at 0.7250.
·Gold (XAU) was able to translate USD weakness into a push back above $900 an ounce before easing into the end of New York on slumping safe haven demand. Overall trading with a low of USD$888 and high of USD$903 before ending the New York session at USD$894 an ounce.
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.2886 |
1.2964 |
1.3265 |
1.3340 |
1.3392 |
|
USD/JPY |
94.15 |
95.43 |
97.50 |
97.98 |
98.15 |
|
GBP/USD |
1.4398 |
1.4516 |
1.4765 |
1.4817 |
1.4942 |
|
AUD/USD |
0.6857 |
0.6954 |
0.7250 |
0.7300 |
0.7327 |
|
XAU/USD |
864.00 |
878.00 |
894.00 |
918.00 |
933.00 |
·Euro – 1.3265
Initial support at 1.2964 (Apr 28 low) followed by 1.2886 (Apr 22 low). Initial resistance is now located at 1.3340 (April 29 high) at followed by 1.3392 (Apr 24 high)
·Yen – 97.50
Initial support is located at 95.43 (Mar 23 low) followed by 94.15 (Mar 23 low). Initial resistance is now at 97.98 (Apr 27 high) followed by 98.15 (Apr 24 high).
·Pound – 1.4765
Initial support at 1.4516 (Apr 27 low) followed by 1.4398 (Apr 22 low). Initial resistance is now at 1.4817 (Apr 20 high) followed by 1.4942 (Apr 17 high).
·Australian Dollar – 0.7250
Initial support at 0.6954 (Apr 20 low) followed by the 0.6857 (Apr 1 low). Initial resistance is now at 0.7300 (Apr 29 high) followed by 0.7327 (Apr 13 high).
·Gold – 894
Initial support at 878 (Apr 21 low) followed by 864 (Apr 17 low). Initial resistance is now at 918 (Apr 27 high) followed by 933 (Apr 1 high).
