Relief Rally on Friday
CURRENCY TRADING SUMMARY – 24th May (00:30GMT)
U.S. Dollar Trading (USD) pared back gains as US stock markets rebounded into the close on Friday allowing risk currencies to rally. With no economic data from the US the bounce was chalked up to rumors that Goldman Sachs had reached an agreement with the SEC and recent selling has been overdone.In US stocks, DJIA +125 points closing at 10193, S& P +16 points closing at 1087 and NASDAQ +25 points closing at 2229. Looking ahead, April Existing Home Sales forecast at 5.62mln vs. 5.35mln previously.
The Euro (EUR) was volatile but quite buoyant as the rebound continued. Highs were seen in Asia above 1.2650 but the market struggled to hold these lofty levels into the weekend. Supporting the rebound was news German’s Government had approved the Greece Bailout. German IFO was at 101.5 vs. 101.9 forecast.EUR/USD traded with a low of 1.2464 and a high of 1.2672 before closing at 1.2572.
The Japanese Yen (JPY) the yen crosses tracked the stock market rallying in Asia before falling at the start of US as the Dow Jones broke below 10000. The Goldman Sachs inspired 250 point Dow Jones Rally then lifted the USD/JPY back to Y90. The BOJ held at 0.1% as widely expected. Overall the USDJPY traded with a low of 89.09 and a high of 90.47 before closing the day around 90.03 in the New York session.
The Sterling (GBP) was well supported on dips as the new conservative government outlined there 6bn saving plan and the US Public Sector borrowing came in as expected at 10bn vs. 23bn previously. GBP/JPY recovered the Y130 level on heavy short covering. Overall the GBP/USD traded with a low of 1.4318 and a high of 1.4496 before closing the day at 1.4486 in the New York session.
The Australian Dollar (AUD) continued to trade in a volatile 200 point range, rallying off 0.8077 lows in Asia to surge to above 0.8300. AUD/JPY flows are responsible for much of the movement as very attractive rates inspire bargain hunting. The proposed 40% Super Profits Mining tax however is continuing to weigh on the Aussie. Overall the AUD/USD traded with a low of 0.8077 and a high of 0.8366 before closing the US session at 0.8313.
Oil & Gold (XAU) was mixed with liquidation of long positions being countered by dip buyers. Overall trading with a low of USD$1166 and high of USD$1188 before ending the New York session at USD$1177 an ounce. Ended roughly unchanged after testing support at the $69 level. WTI Oil Closed +$0.30 at $70.10 a barrel.
TECHNICAL COMMENTARY
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.2135 |
1.2145 |
1.2510 |
1.2731 |
1.2747 |
|
USD/JPY |
87.95 |
88.97 |
90.15 |
91.88 |
92.97 |
|
GBP/USD |
1.4111 |
1.4231 |
1.4485 |
1.4517 |
1.4918 |
|
AUD/USD |
0.7828 |
0.8000 |
0.8270 |
0.8499 |
0.8725 |
|
XAU/USD |
1146.00 |
1157 |
1183.00 |
1229 |
1250.00 |
|
OIL/USD |
68.00 |
69.50 |
70.10 |
70.00 |
72.50 |
Euro – 1.2510
Initial support at 1.2144 (May 19 low) followed by 1.2135 (0.50 of 0.8232-1.6039). Initial resistance is now located at 1.2731 (0.618 of 1.3094-1.2144) followed by 1.2747 (May 12 high)
Yen – 90.15
Initial support is located at 88.97 (May 20 low) followed by 87.95 (May 6 low). Initial resistance is now at 91.88 (May 20 low) followed by 92.97 (May 18 high).
Pound – 1.4485
Initial support at 1.4231 (Mary 20 low) followed by 1.38 (March 18 2009 low). Initial resistance is now at 1.4517 (May 18 High) followed by 1.4918 (May 13 low).
Australian Dollar – 0.8270
Initial support at 0.8000 (Big Figure) followed by the 0.7828 ( 2009 low). Initial resistance is now at 0. 8499 (May 18 low) followed by 0.8725 (May 19 high).
Gold – 1183
Initial support at 1157 (May 5 low) followed by 1146 (April 27 low). Initial resistance is now at 1229 (Key level) followed by 1250 (1123.90 plus 1.618 of 1085.3-1170.1).
Oil – 70.10
Initial support at 69.50 (Intraday Support) followed by 68.00 (Intraday Support). Initial resistance is now at 71.00 (March high) followed by 72.50 (Intraday Resistance).
