China Calls for G8 USD Agenda
CURRENCY TRADING SUMMARY – 2nd July (00:30GMT)
U.S. Dollar Trading (USD) was on the back foot as global equity markets continued to rally. News that China is looking for Global Reserve Currencies to be on the Agenda at the next G8 meeting added to the downside pressure. Data was mixed with ADP Private Unemployment falling -473K in June vs. -393K forecast. May Pending Home sales at 0.1% vs. 0.0% forecast. June ISM Manufacturing climbed to 44.8 vs. 42.8 previously. Crude Oil closes down $0.58 to close the day at $69.31. In US share markets, the Nasdaq was up 10 points or 0.58% and the Dow Jones was up 57 points or 0.68%. Looking ahead, June Non Farm Payrolls forecast at -363K vs. -345K previously. The Unemployment Rate is forecast to rise to 9.6% vs. 9.4% previously.
The Euro (EUR) rallied off the 1.4000 support reportedly from large bids from Asian Central Banks. The market rally continued with better manufacturing data from the US and China during the day and USD reserve concerns. German Retail Sales at 0.4% vs. -0.1% forecast in May. Overall the EUR/USD traded with a low of 1.4000 and a high of 1.4202 before closing at 1.4040. Looking ahead, ECB Rate Announcement and Speech from President Trichet. Also May Unemployment forecast to rise to 9.3 vs. 9.2%.
The Japanese Yen (JPY) broke above resistance at 96.50 to ally towards 97 as risk appetite grew and crosses continued to rally. EUR/JPY was especially buoyant with Global investors continued to diversify there exposure to the USD. Q2 Tankan showed improvement but less than expected at -48 vs. -43 expected. Overall the USDJPY traded with a low of 96.15 and a high of 97.01 before closing the day around 96.60 in the New York session.
The Sterling (GBP) found support under 1.6400 in Early Europe but the bearish sentiment from Tuesday overflowed. USD weakness and GBP/JPY buying help the GBP to rally but EUR/GBP buying kept gains limited. UK Factory PMI jumped to 47 vs. 46.4 previously. Overall the GBP/USD traded with a low of 1.6382 and a high of 1.6548 before closing the day at 1.6480 in the New York session.
The Australian Dollar (AUD) found support in the low 0.80’s but found trading above 0.8100 difficult as traders remained on the sidelines ahead of the Non farm payrolls. Oil weakness dragged but Copper and Gold demand help support. May Retail Sales Jumped 1.0% vs. 0.5% previously. Overall the AUD/USD traded with a low of 0.8021 and a high of 0.8111 before closing the US session at 0.8080. Looking ahead, Trade Balance forecast at -125M vs. -91M previously.
Gold (XAU) Gold rallied hard on the back of USD weakness and investors swooping on prices under $930. Overall trading with a low of USD$927 and high of USD$947 before ending the New York session at USD$940 an ounce.
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.3827 |
1.3983 |
1.4135 |
1.4201 |
1.4268 |
|
USD/JPY |
93.86 |
94.45 |
96.50 |
97.19 |
97.89 |
|
GBP/USD |
1.6041 |
1.6189 |
1.6480 |
1.6745 |
1.6830 |
|
AUD/USD |
0.7790 |
0.7918 |
0.8080 |
0.8155 |
0.8263 |
|
XAU/USD |
906.00 |
912.00 |
940.00 |
948.00 |
965.00 |
Euro – 1.4135
Initial support at 1.3983 (Jun 29 low) followed by 1.3827 (Jun 22 low). Initial resistance is now located at 1.4201 (July 1 high) followed by 1.4267 (Jun 5 high)
Yen – 96.50
Initial support is located at 94.45 (Jun 1 low) followed by 93.86 (May 22 low). Initial resistance is now at 97.19 (Jun 19 high) followed by 97.89 (Jun 16 high).
Pound – 1.6480
Initial support at 1.6189 (Jun 18) followed by 1.6041 (Resistance Nov 6). Initial resistance is now at 1.6745 (Jul 1 Level) followed by 1.6830 (Fibo Level).
Australian Dollar – 0.8080
Initial support at 0.7918 (Jun 24 low) followed by the 0.7790 (Jun 23 low). Initial resistance is now at 0.8155 (Jun 30 high) followed by 0.8263 (Jun 3 high).
Gold – 940
Initial support at 912 (Fibo level low) followed by 906 (May 8 low). Initial resistance is now at 948 (Jun 26 high) followed by 965 (June 10 high).
