Australian FOREX Daily Outlook 13/04/2010

Euro struggling to hold gains

CURRENCY TRADING SUMMARY – 13th April (00:30GMT)

U.S. Dollar Trading (USD) the dollar opened Monday extremely weak but spent the rest of the day gaining as traders first took profit and then bought the Dollar especially against the commodities. Stocks were roughly flat as the market prepares for quarterly company results. In US stocks, DJIA +8 points closing at 11005, S&amp P +2 points closing at 1196 and NASDAQ +3 points closing at 2457. looking ahead, February Trade Balance is forecast at -38.5bn vs. -37.2bn previously.

The Euro (EUR) European traders were less impressed with the Greece bailout then the Asia open and the market fell back below 1.3600. Concerns within Germany about its capitulation revolve around the possibility that other European countries such as Spain and Portugal needing bailouts as well. Overall the EUR/USD traded with a low of 1.3564 and a high of 1.3694 before closing at 1.3580. Looking ahead, German CPI is forecast at 0.5% vs. 0.4% previously.

The Japanese Yen (JPY) found strength against the dollar at the start of Europe pushing up from Y93 to to Y93.50 as risk appetite inspired from the weekend supported most crosses. Over the day the Yen did find some strength however as profit taking on the majors transferred over to EUR/JPY and GBP/JPY. Overall the USDJPY traded with a low of 93.03 and a high of 93.63 before closing the day around 93.20 in the New York session. UPDATE March CGPI at 0.2% vs. 0.3% forecast.

The Sterling (GBP) traded up to just under 1.5500 in the Asian session before spending the rest of the day on the back foot as GBP/JPY selling and EUR/GBP buying put pressure on the resurgent pound. Much of the movement ahead will come from changes in election polls. Overall the GBP/USD traded with a low of 1.5350 and a high of 1.5488 before closing the day at 1.5380 in the New York session. Looking ahead February Trade Balance is forecast at -7bn vs. -8bn previously.

The Australian Dollar (AUD) suffered greatly on dovish comments from the assistant RBA governor Debelle who stated that the average rates are not far from current levels for business and led to speculation the RBA may pause from it’s recent hiking spree. Overall the AUD/USD traded with a low of 0.9236 and a high of 0.9369 before closing the US session at 0.9260. UPDATE March Business Confidence at 16 vs. 19 previously.

Oil &amp Gold (XAU) tested $1170 in Asia before pulling back on profit taking to the mid $1150’s. Overall trading with a low of USD$1154 and high of USD$1167 before ending the New York session at USD$1156 an ounce. Crude Oil fell for the 4^th day on demand concerns. WTI Oil Closed -$0.58 at $84.34 a barrel.

TECHNICAL COMMENTARY

Euro – 1.3590

Initial support at 1.3500 (Apr 9 high) followed by 1.3341 (Apr 9 low). Initial resistance is now located at 1.3741 (Mar 18 high) followed by 1.3819 (Mar 17 high)

Yen – 93.20

Initial support is located at 92.76 (Mar 31 low) followed by 92.25 (0.382 of 88.14-94.79). Initial resistance is now at 93.77 (Apr 9 high) followed by 94.27 (Apr 7 High).

Pound – 1.5370

Initial support at 1.5130 (Apr 6 low) followed by 1.5044 (Mar 31 low). Initial resistance is now at 1.5575 (Feb 23 high) followed by 1.5688 (Feb 18 low).

Australian Dollar – 0.9255

Initial support at 0.9224 (Apr 8 low) followed by the 0.9166 (Apr 6 low). Initial resistance is now at 0.9388 (Apr 12 high) followed by 0.9406 (Nov 16 high).

Gold – 1156

Initial support at 1143 (Apr 8 low) followed by 1132 (Apr 7 low). Initial resistance is now at 1169 (Dec 8 high) followed by 1183 (0.764 of 1126.56-1044.85).

Oil – 84.20

Initial support at 83.80 (Intraday Support) followed by 82.50 (Intraday Support). Initial resistance is now at 85.00 (March high) followed by 86.00 (Intraday Resistance).