Australian FOREX Daily Outlook 16/04/2010

Greece and Portugal Debt Pressure Euro

CURRENCY TRADING SUMMARY – 16th April (00:30GMT)

U.S. Dollar Trading (USD) was able to make solid gains even as stock markets rallied, strong on the back of renewed Euro concerns. US data was mixed with Weekly Jobless Claims jumping to 480k vs. 460k previously, whilst February TICS Flows came in at 47bn vs. 15bn. In US stocks, DJIA +21 points closing at 11144, S&amp P +1 points closing at 1211 and NASDAQ +10 points closing at 2515. looking ahead, February Housing Starts previously at -5.9%. Also released, April Consumer Sentiment Forecast at 75 vs. 73.6.

The Euro (EUR) was sold heavily at the start of Europe as Greece bond Yields surged above 7% to pre bailout levels and speculation mounted that Greece would have to activate the Aid plan given by EU/IMF. Adding to the worry was the jump in Portugal bond yields and Greece contagion concern. Overall the EUR/USD traded with a low of 1.3521 and a high of 1.3669 before closing at 1.3570. Looking ahead, March Inflation forecast at 0.9% vs. 0.3% previously.

The Japanese Yen (JPY) a lot of strength was seen as the end of the Asian session as the Chinese bank regulators tightened up lending requirements and EUR/JPY dragged down most crosses. Chinese GDP was at 11.9% vs. 10.7% and added to speculation that China will have to raise rates/revalue Yaun sometime soon. Overall the USDJPY traded with a low of 92.85 and a high of 93.54 before closing the day around 93.10 in the New York session.

The Sterling (GBP) tested resistance at 1.55 in Asia before falling heavily with the Euro to below 1.5400. the rest of the day cable found support and grinded higher gradually. EUR/GBP was very heavy on the Euro concerns and the pair slipped from 0.8820 to 0.8760. March Consumer Confidence slumped to 72 vs. 80 previously. Overall the GBP/USD traded with a low of 1.5383 and a high of 1.5526 before closing the day at 1.5490 in the New York session.

The Australian Dollar (AUD) continued to be well supported as stock markets gained and traders shrugged off the Euro selling. EUR/AUD has resumed its downtrend and traded to 1.4500. AUD/JPY finished mixed just above the Y87 level but us struggling to break above Y87.50 as the rest of the Yen pairs remain afloat. Overall the AUD/USD traded with a low of 0.9309 and a high of 0.9367 before closing the US session at 0.9350.

Oil &amp Gold (XAU) was well supported on the spike is sovereign debt risk. Overall trading with a low of USD$1150 and high of USD$1162 before ending the New York session at USD$1160 an ounce. Crude Oil gave up some of the gains seen from Wednesday’s rally. WTI Oil Closed -$0.33 at $85.51 a barrel.

TECHNICAL COMMENTARY

Euro – 1.3555

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 – 92.70

Initial support is located at 92.58 (April 13 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 – 1.5430

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 – 0.9305

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 – 1155

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 – 84.80

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).