Attention turns to the ECB and BOE
CURRENCY TRADING SUMMARY – 6th August (00:30GMT)
U.S. Dollar Trading (USD) some more cautious US data helped send the stocks markets lower and offered the USD some relief from the relentless selling seen in recent days. July ADP fell -371k vs. -463k previously and -345k forecast. July Services PMI at 46.4 vs. 47 previously and 48 forecast added pressure to the brakes. Crude Oil Closed up $0.55 at $71.97. In US share markets, S& P ended -3 points (-0.40%) at 1005, NASDAQ ended -18 points (-0.9%) at 1993 and DOW JONES ended -39 points (-0.4%) at 9280. Looking ahead, weekly jobless claims are forecast at 580k vs. 584k previously.
The Euro (EUR) once again kept to the upper range with dips after US data been seen as good opportunities to buy and the market continuing to pivot the 1.4400 level. 1.4450 protection from option sellers once again refuted the bulls and the market went back to the holding pattern ahead of ECB tonight. June retail Sales at -0.2% was forecast at +0.2% vs. -0.4% previously. Overall the EUR/USD traded with a low of 1.4356 and a high of 1.4447 before closing at 1.4410. Looking ahead, June Industrial Orders forecast at 0.8% vs. 4.4% previously. ECB Interest Rate meeting widely forecast to hold 1.0%.
The Japanese Yen (JPY) opened above 95 Yen but fell back as sentiment soured and the US data shook the boat. The pair found support below 95 when the crosses bounced off lows. GBP/JPY traded at fresh year highs above 162 Yen briefly and AUD/JPY continued to pivot the 80 Yen level. Overall the USDJPY traded with a low of 94.63 and a high of 95.39 before closing the day around 94.90 in the New York session. Looking ahead, July FX reserves previously at 1019bn in June.
The Sterling (GBP) broke above 1.7000 after strong UK data, Services PMI at 53.2 in July vs. 51.9 forecast. Manufacturing Production jumped to 0.4% vs. 0.0% forecast, the largest gain in 20 months. Resistance above 1.7000 proved too much for the pound as sentiment soured and heavy profit taking emerged. The outlook is still bullish though and attention is turning to the BOE tonight as to whether the QE program will be extended. Overall the GBP/USD traded with a low of 1.6901 and a high of 1.7043 before closing the day at 1.6990 in the New York session. Looking ahead, BOE Rate announcement widely expected to remain at 0.5%.
The Australian Dollar (AUD) was well supported on dips below 0.8400 but failed like with the Euro and GBP at the higher end of the range near 0.8450. Stock market sentiment and risk appetite are providing the intraday direction. June Trade Balance better than expected at -0.44b vs. -0.79bn forecast. Overall the AUD/USD traded with a low of 0.8363 and a high of 0.8452 before closing the US session at 0.8410. Looking ahead, July Unemployment forecast at -20k vs. -21.4k previously. The Unemployment Rate is forecast to rise to 6.0% vs. 5.8% previously.
Gold (XAU) tracked Oil and Dollar movements dipping before testing the highs to settle roughly were it began the day. Overall trading with a low of USD$951 and high of USD$968 before ending the New York session at USD$965 an ounce.
TECHNICAL COMMENTARY
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.4207 |
1.4338 |
1.4420 |
1.4445 |
1.4621 |
|
USD/JPY |
93.10 |
94.02 |
94.95 |
95.88 |
96.24 |
|
GBP/USD |
1.6474 |
1.6697 |
1.7000 |
1.7198 |
1.7518 |
|
AUD/USD |
0.8238 |
0.8340 |
0.8410 |
0.8519 |
0.8694 |
|
XAU/USD |
932.00 |
951.00 |
965.00 |
970.00 |
990.00 |
Euro – 1.4420
Initial support at 1.4338 (June 3 low) followed by 1.4207 (AUG 3 low). Initial resistance is now located at 1.4445 (Jun 3 high) followed by 1.4621 (61.8% retrace 1.6038 -1.2330 )
Yen – 94.95
Initial support is located at 94.02 (Jul 29 low) followed by 93.10 (July 22 low). Initial resistance is now at 95.88 (Jul 6 high) followed by 96.24 (July 6 high).
Pound – 1.7000
Initial support at 1.6397 (AUG 3 low) followed by 1.6474 (Jul 31 low). Initial resistance is now at 1.7198 (Oct 21 high) followed by 1.7518 (Oct 20 high).
Australian Dollar – 0.8410
Initial support at 0.8340 (AUG 3 low) followed by the 0.8238 (July 31 low). Initial resistance is now at 0.8519 (Sept 22 high) followed by 0.8694 (Aug 28 low).
Gold – 965
Initial support at 951 (AUG 5 low) followed by 932 (July 31 low). Initial resistance is now at 970 (AUG 4 high) followed by 990 (June 3 high).
