Optimism continues to grow
11/05/09
last week’s currency trading review
The Dollar continued to weaken for the 8th week as the market found more reasons to rally on Economic data and the Bank Stress tests. News that $75 Billion would be needed by the 19 largest US banks was welcomed by the Market and Global stocks continued to soar. Also helping risk appetite was April Non-Farm Payrolls at -539K vs. -590K forecast. The Unemployment rate jumped to 8.9% as forecast. The Euro made large gains after the ECB cut rates on Thursday and declined to enter a major Quantitative Easing. The EUR/USD gain 2.74% closing at 1.3642, after opening the week at 1.3268. The Japanese Yen made small gains against the USD but finished broadly weaker against the rest of the crosses with risk trades roaring back to like. The USD/JPY fell 0.65% closing at 98.48 after opening at 99.12. The GBP broke 1.5000 decisively on Friday surging to 5 month highs above 1.5200. The Bank of England held at 0.5% but announced an expansion of the QE program to 125 Bn Pounds. The GBP/USD gained 2.07% closing at 1.5235 after opening at 1.4916. The AUD continued to advance as stocks gained and the USD weakened. AUD/JPY buying helped to propel the commodity currency to prices not seen since last October. The AUD/USD closed up 4.96% at 0.7681 after opening at 0.7300.
The forex trading week preview
In the States Inflation Data in focus this week. On Tuesday March Trade Balance is forecast at -29 Bn vs. -26 Bn previously. Wednesday we have April Retail Sales forecast at 0.0% vs. -1.2% previously. On Thursday we have weekly jobless claims forecast at 610K vs. 601K previously. On Friday we have May Consumer Confidence forecast at 65.8 vs. 65.1 previously. We will provide our previews and reviews of these data releases in the daily summary.
In the Eurozone On Tuesday German CPI (April) forecast at 0.7% vs. 0.5%. On Wednesday Industrial Production (Mar) is forecast at -1.0% vs. -2.3% previously. On Friday, GDP is forecast at -2.0% vs. -1.6% previously. In the UK On Tuesday, March Industrial Production is forecast at -0.85 vs. -1.0% previously. On Wednesday, we have ILO Unemployment forecast at 6.9% vs. 6.7%. Also on Wednesday the Bank of England Quarterly. We will provide our previews and reviews of these data releases in the daily summary.
In Japan On Wednesday March Current Account is forecast at 1210Bn vs. 1116Bn previously. On Friday we have March Machine Orders forecast at -4.7%. We will provide our previews and reviews of these data releases in the daily summary.
In Australia The Federal Budget on Tuesday is the Highlight. Also of note, New Zealand Retail Sales on Friday. We will provide our previews and reviews of these data releases in the daily summary.
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.3247 |
1.3343 |
1.3580 |
1.3739 |
1.3799 |
|
USD/JPY |
96.39 |
97.15 |
97.30 |
99.75 |
100.43 |
|
GBP/USD |
1.4704 |
1.4836 |
1.5115 |
1.5231 |
1.5373 |
|
AUD/USD |
0.7233 |
0.7337 |
0.7580 |
0.7738 |
0.8097 |
|
XAU/USD |
878.00 |
895.00 |
913.00 |
933.00 |
845.00 |
·Euro – 1.3620
Initial support at 1.3247 (May 6 low) followed by 1.3212 (38.2% retrace 1.2889-1.3736). Initial resistance is now located at 1.3628 (May 8 high) followed by 1.3739 (Mar 19 high)
·Yen – 98.75
Initial support is located at 97.94 (May 6 low) followed by 97.15 (Apr 30 low). Initial resistance is now at 99.75 (Apr 17 high) followed by 100.43 (Apr 14 high).
·Pound – 1.5210
Initial support at 1.4836 (May 4 low) followed by 1.4704 (Apr 30 low). Initial resistance is now at 1.5231 (May 8 high) followed by 1.5373 (Jan 8 high).
·Australian Dollar – 0.7685
Initial support at 0.7337 (May 6 low) followed by the 0.7233 (Apr 30 low). Initial resistance is now at 0.7738 (Oct 6 high) followed by 0.8097 (Sept 30 high).
·Gold – 917
Initial support at 895 (May 6 low) followed by 878 (Apr 21 low). Initial resistance is now at 933 (Apr 1 high) followed by 945 (Mar 26 high).
