Stocks Continue Rally, USD weakens
CURRENCY TRADING SUMMARY – 22nd February (00:30GMT)
U.S. Dollar Trading (USD) the stock sell off from the FED Discount rate Hike was short lived with US traders taking the central bank move as a positive for markets by inferring the banks no longer need as much assistance. January CPI rose 0.2% vs. 0.3% forecast m/m. In US stocks DJIA +9 points closing at 10402, S& P +2 points closing at 1108 and NASDAQ +2 points closing at 2216.
The Euro (EUR) enjoyed a short squeeze as traders booked profits ahead of the weekend and Oil and stocks continued to rally. Also helping the pair find support under 1.3500 was better than expected PMI manufacturing at 54.1 vs. 52.8 previously. Overall the EUR/USD traded with a low of 1.3444 and a high of 1.3607 before closing at 1.3590.
The Japanese Yen (JPY) eased back from the spike higher above Y92 in Early Asia as FED officials played down the rate hike being the beginning of a wider change in monetary policy. Crosses remain buoyant however as the majors rallied on the positive mood in the US. Overall the USDJPY traded with a low of 91.60 and a high of 92.14 before closing the day around 91.60 in the New York session.
The Sterling (GBP) rallied off lows but lagged the rest of the market as economic data soured. January Retail Sales slumped -1.2% vs. -0.5% m/m. GBP/AUD fell to 25 year lows below 1.7250 as the two economies outlook continued to diverge. Overall the GBP/USD traded with a low of 1.5350 and a high of 1.5480 before closing the day at 1.5450 in the New York session.
The Australian Dollar (AUD) outperformed the rest of the market as gold and Oil surged off lows and USD strength retreated. RBA Governor Stevens in Asia talked about Interest rates approaching normal levels but when pressed stated he believed 2-4 rate hikes were appropriate this year. Overall the AUD/USD traded with a low of 0.8879 and a high of 0.8989 before closing the US session at 0.8982.
Oil & Gold (XAU) shrugged off the FED’s move to rally aggressively off the $1100 level to test $1125 resistance in New York. Overall trading with a low of USD$1099 and high of USD$1127 before ending the New York session at USD$1119 an ounce. Rallied above the key $80 level on news French refineries would be closed by strikes. Crude Oil was down +$1.20 ending the New York session at $80.20.
TECHNICAL COMMENTARY
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.3400 |
1.3424 |
1.3640 |
1.3788 |
1.3839 |
|
USD/JPY |
90.13 |
90.57 |
91.65 |
92.11 |
93.20 |
|
GBP/USD |
1.5117 |
1.5273 |
1.5485 |
1.5500 |
1.5861 |
|
AUD/USD |
0.8786 |
0.8849 |
0.9010 |
0.9037 |
0.9093 |
|
XAU/USD |
1078.00 |
1098 |
1125.00 |
1127 |
1141.00 |
|
OIL/USD |
78.00 |
80.00 |
80.20 |
81.50 |
82.50 |
Euro – 1.3640
Initial support at 1.3424 (May 18 low) followed by 1.3400 (Big figure). Initial resistance is now located at 1.3788 (Feb 17 high) followed by 1.3839 (Feb 9 high)
Yen – 91.65
Initial support is located at 90.57 (Feb 18 low) followed by 90.13 (Feb 17 low). Initial resistance is now at 92.11 (Feb 18 high) followed by 93.2 (intraday resistance).
Pound – 1.5485
Initial support at 1.5273 (0.5 of 1.3503-1.7043) followed by 1.5117 (May 18 low). Initial resistance is now at 1.5500 (Intraday resistance high) followed by 1.5861 (Feb 1 low).
Australian Dollar – 0.9010
Initial support at 0.8849 (Feb 15 low) followed by the 0.8786 (Feb 12 low). Initial resistance is now at 0.9037 (Feb 17 high) followed by 0.9093 (Jan 25 high).
Gold – 1125
Initial support at 1098 (Feb 18 low) followed by 1078 (Feb 12 low). Initial resistance is now at 1127 (Feb 17 high) followed by 1141 (Jan 20 high).
Oil – 80.20
Initial support at 80.00 (Intraday Support) followed by 78.00 (Intraday Support). Initial resistance is now at 81.50 (Intraday Resistance) followed by 82.50 (Intraday Resistance).
