Last week’s currency trading review
The Dollar started the week on a strong footing after the strong Non Farm Payrolls data and was able to keep this strong footing for most of the week as the market focused on Greece’s woes. Pending Home Sales jumped 8.0% in a positive sign for US housing and the FOMC minutes were slightly dovish allowing the stock market another week of gains. The Euro tested March lows under 1.3300 before receiving a boost on Friday as speculation mounted the EU would do something over the weekend to stabilize the Greece situation. The ECB held at 1.0% as forecast and ECB president Trichet was relatively upbeat on the recovery. The EUR/USD lost 0.04% closing at 1.3497, after opening the week at 1.340.
The Japanese Yen enjoyed some of the benefit of heavy EUR/JPY selling on the Greece issue as the heavily sold off Yen was bought back across the board. USD/JPY slipped back to 92.80 after opening above Y94.50 on Monday. The BOJ met and held at 0.1% and stated that although the economy was recovering it was not currently self sustaining. The USD/JPY fell -1.53% closing at 94.61, after opening at 92.49 previously. The GBP broke above resistance at 1.5320 to finish the week on the front foot as the market responded to improving economic data and a more neutral BOE. The Bank of England held at 0.5% and kept the Asset Purchase program at 200bn with most analysts thinking the bank will wait for after the elections before revealing their hand. GBP/USD gained +1.09% closing at 1.5374 after opening at 1.5207. The AUD pushed above 0.9300 on Friday as Gold extended its gains to above $1160. Gains were underpinned by a RBA rate hike to 4.25% on Tuesday and solid Unemployment numbers with a gain of 20k in March. AUD/NZD continued to push above 1.3000 but further gains are in question. The AUD/USD gained +1.55% closing at 0.9335 after opening at 0.9190.
The forex trading week preview
In the States On Tuesday, Feb Trade Balance is forecast at -39bn vs. -37.3bn previously. On Wednesday, March Retail Sales are forecast at 1.1% vs. 0.3% previously. Also released, March CPI is forecast at 2.4% vs. 2.1% previously. On Thursday, Weekly Jobless claims are forecast at 440k vs, 460k previously. Also released, March Industrial Production forecast at 0.7% vs. 0.1% previously. On Friday, March Housing Starts are forecast at 6.1% vs. -5.9% previously. We will provide our previews and reviews of these data releases in the daily summary.
In the Eurozone On Tuesday, Greece Debt Auction. On Wednesday, February Industrial Production is forecast at 0.3% vs. 1.7% previously. On Friday, March CPI is forecast at 1.5% vs. 0.9% y/y. In the UK On Tuesday, February Trade Balance forecast at -7.2bn vs. -7.9bn previously. On Wednesday, March Nationwide Consumer Confidence is forecast at 81 vs. 80 previously. We will provide our previews and reviews of these data releases in the daily summary.
In Japan On Thursday, February Industrial Production previously at -0.9%. In Australia On Wednesday, Westpac Consumer Confidence. We will provide our previews and reviews of these data releases in the daily summary.
TECHNICAL COMMENTARY
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.3341 |
1.3500 |
1.3590 |
1.3741 |
1.3819 |
|
USD/JPY |
92.25 |
92.76 |
93.20 |
93.77 |
94.27 |
|
GBP/USD |
1.5044 |
1.5130 |
1.5370 |
1.5575 |
1.5688 |
|
AUD/USD |
0.9166 |
0.9224 |
0.9255 |
0.9388 |
0.9406 |
|
XAU/USD |
1132.00 |
1143 |
1156.00 |
1169 |
1183.00 |
|
OIL/USD |
82.50 |
83.8 |
84.20 |
85 |
86.00 |
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).
