US Stocks Slide
CURRENCY TRADING SUMMARY – 27th October (00:30GMT)
U.S. Dollar Trading (USD) gained across the board as US stocks came under continued pressure and reports that China should diversify its reserves into Euro’s and Yen was discounted as personal opinion of the author. Banking stocks led the market lower. In US Stocks, DJIA -104 points closing at 9867, S& P -12 points closing at 1066 and NASDAQ -12 points closing at 2141. Looking ahead, August Case Shiller House prices are forecast at 0.7% vs. 1.6% previously. Also released, CB Consumer Confidence forecast at 53.1 in October.
The Euro (EUR) fell heavily after forming a double top at 1.5060 earlier in the Asian session. Gains were on the back of the Chinese report which when later discounted caused the Euro to pare back and this turned into a rout as US stocks slumped for a second day. Overall the EUR/USD traded with a low of 1.4844 and a high of 1.5063 before closing at 1.4870. September Private Loans is forecast at -0.3% vs. 0.1%.
The Japanese Yen (JPY) held above 92 Yen against the Dollar but the crosses slumped as risk aversion ticked higher on mounting stock losses. GBP/JPY held up well shrugging off risk aversion as GBP rebounded from Fridays sell off. Overall the USDJPY traded with a low of 91.58 and a high of 92.29 before closing the day around 92.25 in the New York session. Looking ahead, September Retail Sales are forecast at -1.6% vs. -1.8% y/y.
The Sterling (GBP) managed to eek out small gains as the market recovered both on the crosses and the major during the day. Speculation the sell off on Friday was overdone and that the GDP numbers would be revised higher helped sustain gains. Overall the GBP/USD traded with a low of 1.6253 and a high of 1.6396 before closing the day at 1.6320 in the New York session. Looking ahead, October CBI Distributive Trades are forecast at 5 vs. 3 previously.
The Australian Dollar (AUD) was hit hard by the USD strength and large falls in Commodities. Q3 PPI was also weak at 0.1% vs. 0.3% forecast as the high Aussie dollar helped stem inflation. CPI numbers tomorrow are very important as the market focuses on the speed of RBA rate rises. Overall the AUD/USD traded with a low of 0.9126 and a high of 0.9277 before closing the US session at 0.9160.
Oil & Gold (XAU) Gold fell back heavily as Oil remained heavy. Overall trading with a low of USD$1037 and high of USD$1060 before ending the New York session at USD$1038 an ounce. Was under pressure as stocks fell and sentiment soured. Crude Oil was down -1.82 ending the New York session at $88.68.
TECHNICAL COMMENTARY
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.4762 |
1.4829 |
1.4875 |
1.5083 |
1.5163 |
|
USD/JPY |
90.49 |
91.28 |
92.25 |
92.53 |
93.30 |
|
GBP/USD |
1.6120 |
1.6241 |
1.6320 |
1.6693 |
1.6742 |
|
AUD/USD |
0.8985 |
0.9113 |
0.9170 |
0.9347 |
0.9476 |
|
XAU/USD |
1036.00 |
1037 |
1038.00 |
1067.00 |
1070.00 |
|
OIL/USD |
77.50 |
78.50 |
78.60 |
80.00 |
82.00 |
Euro – 1.4875
Initial support at 1.4829 (Oct 19 low) followed by 1.4762 (Oct 13 low). Initial resistance is now located at 1.5083 (Oct 21 high) followed by 1.5163 (76.4% retrace 1.6038 – 1.2330)
Yen – 92.25
Initial support is located at 91.18 (Oct 23 low) followed by 90.49 (Oct 21 low). Initial resistance is now at 92.53 (Sept 21 high) followed by 93.3 (Sept 7 high).
Pound – 1.6320
Initial support at 1.6241 (Oct 19 low) followed by 1.6120 (Oct 8 low). Initial resistance is now at 1.6693 (Oct 23 high) followed by 1.6743 (Sept 11 high).
Australian Dollar – 0.9170
Initial support at 0.9113 (Oct 19 low) followed by the 0.8985 (Oct 12 low). Initial resistance is now at 0.9347 (Aug 4 08 high) followed by 0.9476 (Jul 31 08 high).
Gold – 1038
Initial support at 1037 (Oct 26 low) followed by 1036 (Oct 7 low). Initial resistance is now at 1067 (Oct 20 high) followed by 1070 (Oct 14 high).
Oil – 78.60
Initial support at 78.50 (Intraday Support) followed by 77.50 (Intraday support). Initial resistance is now at 80.00 ( Major Level) followed by 82.00 (October High).
