USD Building Momentum
CURRENCY TRADING SUMMARY – 18th December (00:30GMT)
U.S. Dollar Trading (USD) enjoyed strength across the board as the biggest currency pair, the Euro saw a major break lower. USD/JPY also broke higher above the key 90 Yen level but failed to push too much further with risk aversion present in the US Equity session. Weekly Jobless Claims were slightly weaker at 480k vs. 465k previously. DJIA -132 points closing at 10308, S& P -13 points closing at 1096 and NASDAQ -26 points closing at 2180.
The Euro (EUR) ongoing concerns about Greece Debt and a break of the major support at 1.4500 led to major move on the downside. Heavy stop losses and weak gold saw the the Euro slide to 1.4300 supports where the market was finally able to rebound. Overall the EUR/USD traded with a low of 1.4303 and a high of 1.4533 before closing at 1.4345. Looking ahead, December IFO forecast at 94.5 vs. 93.9 previously.
The Japanese Yen (JPY) traded above the 90 Yen level in Asia on a very strong Dollar but was unable to hold above the key level throughout the day as bouts of Yen buying emerged on fresh risk aversion. AUD/JPY and EUR/JPY weighed the market down. Overall the USDJPY traded with a low of 89.54 and a high of 90.39 before closing the day around 89.90 in the New York session. Looking ahead, BOJ Rate Decision forecast to remain at 0.1%
The Sterling (GBP) held up well in the face of massive Euro losses until bad data in Europe led the GBP to play catch up. UK November Retail Sales fell -0.3% vs. 0.4% previously. Cable fell to multi month lows below 1.6100. EUR/GBP fell under 0.8900 comfortably. Overall the GBP/USD traded with a low of 1.6078 and a high of 1.6337 before closing the day at 1.6160 in the New York session.
The Australian Dollar (AUD) broke down with the Euro to 3 month lows under 0.8900 as the USD strengthened and stocks tumbled. AUD/JPY selling also took the important cross below the key 80 yen level. The market mood has changed dramatically towards the risk currency in the past few days as interest rate predictions for 2010 are toned down. Overall the AUD/USD traded with a low of 0.8809 and a high of 0.9007 before closing the US session at 0.8870.
Oil & Gold (XAU) longs capitulated sending the precious metal over $40 an ounce lower during the day. Overall trading with a low of USD$1095 and high of USD$1142 before ending the New York session at USD$1098 an ounce. Held up well as the market rebound continued from the recent downtrend. Crude Oil was down -$0.50 ending the New York session at $72.66.
TECHNICAL COMMENTARY
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.4287 |
1.4329 |
1.4345 |
1.4591 |
1.4685 |
|
USD/JPY |
88.20 |
89.39 |
89.95 |
90.77 |
91.32 |
|
GBP/USD |
1.5903 |
1.5973 |
1.6162 |
1.6411 |
1.6516 |
|
AUD/USD |
0.8647 |
0.8760 |
0.8870 |
0.9070 |
0.9175 |
|
XAU/USD |
1080.00 |
1095 |
1098.00 |
1110.00 |
1147.00 |
|
OIL/USD |
70.00 |
72.50 |
72.70 |
73.50 |
75.00 |
Euro – 1.4345
Initial support at 1.4329 (Sep 8 low) followed by 1.4287 (Sep 7 low). Initial resistance is now located at 1.4591 (Dec 16 high) followed by 1.4685 (Dec 14 high)
Yen – 89.95
Initial support is located at 89.39 (Dec 16 low) followed by 88.20 (Dec 11 low). Initial resistance is now at 90.77 (Dec 4 high) followed by 91.32 (Nov 4 High).
Pound – 1.6162
Initial support at 1.5973 (Oct 15 low) followed by 1.5903 (Oct 14 low). Initial resistance is now at 1.6411 (Dec 16 high ) followed by 1.6516 (Dec 7 high).
Australian Dollar – 0.8870
Initial support at 0.8760 (Oct 6 low) followed by the 0.8647 (Oct 5 low). Initial resistance is now at 0.9070 (Dec 16 high) followed by 0.9175 (Dec 14 high).
Gold – 1098
Initial support at 1095 (Nov 9 low) followed by 1080 (Key support). Initial resistance is now at 1110 (Previous Support) followed by 1147 (Dec 9 high) .
Oil – 72.70
Initial support at 72.50 (Intraday support) followed by 70.00 (Intraday support). Initial resistance is now at 73.50 (Key Psychological Level) followed by 75.00 (Intraday resistance).
