Euro leads Market Crash
CURRENCY TRADING SUMMARY – 5th February (00:30GMT)
U.S. Dollar Trading (USD) broad based gains on the back of risk aversion and safe haven flows saw the USD trade at fresh 2010 highs. Stocks crashed as the market was spooked by European Debt concerns and rapid falls in commodities. In US stocks DJIA -26 points closing at 10270, S& P -6 points closing at 1097 and NASDAQ +1 points closing at 2190. Looking ahead, January Unemployment Rate forecast at 10.1% vs. 10.0% previously. January NonFarm Payrolls are forecast at 5k vs. -85k previously.
The Euro (EUR) broke through support at 1.3850 as concerns about Portugal and Spain debt added to the Greece saga. The ECB held rates at 1.0% but the President Trichet failed to install confidence at the press conference. Overall the EUR/USD traded with a low of 1.3712 and a high of 1.3905 before closing at 1.3740. Looking ahead, December Industrial Output is forecast at 0.5% vs. 0.7%.
The Japanese Yen (JPY) was the strongest currency as USD/JPY slumped through supports at Y90 and crosses crashed lower. GBP/JPY traded below Y140 and EUR/JPY slumped to below Y122. Yen strength was especially seen after the US Weekly Jobless claims increased to 480k. Overall the USDJPY traded with a low of 88.53 and a high of 91.10 before closing the day around 89.10 in the New York session. Looking ahead, December Leading Indicators Index previously at 1.8.
The Sterling (GBP) managed a brief rally after the BOE held at 0.5% and kept the Asset Purchase Program at 200bn. Heavy GBP/JPY selling in the US session resumed the pressure on the downside and cable fell through 1.5800. Overall the GBP/USD traded with a low of 1.5729 and a high of 1.5921 before closing the day at 1.5760 in the New York session. Looking ahead, January PPI Output forecast at 0.35 vs. 0.55 previously.
The Australian Dollar (AUD) was under heavy pressure with stock/commodity crash and weak December Retail Sales at -0.7% vs. -0.2%m/m previously. AUD/JPY slumped over 3 Yen in the US session as longs capitulated and AUD/USD broke through December lows at 0.8735. Overall the AUD/USD traded with a low of 0.8605 and a high of 0.8828 before closing the US session at 0.8640. Looking ahead, RBA monetary statement released.
Oil & Gold (XAU) Gold broke through recent supports falling over $40 an ounce on the day. Overall trading with a low of USD$1059 and high of USD$1111 before ending the New York session at USD$1168 an ounce. Fell over 5% as investors bailed out of riskier trades. Crude Oil was up $-3.76 ending the New York session at $73.25.
TECHNICAL COMMENTARY
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.3485 |
1.3584 |
1.3730 |
1.3903 |
1.4026 |
|
USD/JPY |
88.50 |
89.00 |
89.25 |
90.00 |
91.28 |
|
GBP/USD |
1.5517 |
1.5708 |
1.5760 |
1.5918 |
1.6069 |
|
AUD/USD |
0.8570 |
0.8647 |
0.8675 |
0.8826 |
0.8928 |
|
XAU/USD |
1041.00 |
1055 |
1065.00 |
1100 |
1125.00 |
|
OIL/USD |
72.50 |
73.00 |
73.30 |
75.00 |
77.00 |
Euro – 1.3730
Initial support at 1.3584 (May 20 low) followed by 1.3485 (61.8% retrace of 1.2459 to 1.5144). Initial resistance is now located at 1.3903 (Feb 4 high) followed by 1.4026 (Feb 3 high)
Yen – 89.25
Initial support is located at 89.00 (big figure) followed by 88.50 (Feb 4 low). Initial resistance is now at 90 (key level) followed by 91.28 (Feb 3 high).
Pound – 1.5760
Initial support at 1.5708 (Oct 13 low) followed by 1.5517 (May 21 low). Initial resistance is now at 1.5918 (Feb 4) followed by 1.6069 (Feb 3 high).
Australian Dollar – 0.8675
Initial support at 0.8647 (Oct 5 low) followed by the 0.8570 (Oct 2 low). Initial resistance is now at 0.8826 (Feb 4 high) followed by 0.8928 (Feb 2 high).
Gold – 1065
Initial support at 1055 (Nov 3 low) followed by 1041 (Nov 2 low). Initial resistance is now at 1100 (Big figure) followed by 1125 (Feb 3 high).
Oil – 73.30
Initial support at 73.00 (Intraday Support) followed by 72.50 (Intraday Support). Initial resistance is now at 75.00 (Intraday Resistance) followed by 77.00 (Intraday Resistance).
