Daily Outlook 20th September 2010
U.S. Dollar Trading (USD) some weak consumer confidence data prompted some profit taking in stocks on Friday and allowed the USD to pare back some of its weekly losses. UoM September Consumer Sentiment fell to 66.6 vs. 68.9 previously. August CPI rose 0.3% m/m but the Core CPI was flat so there is little evidence of inflationary pressure in the US at the moment with y/y figures at only 1.1%. In US stocks, DJIA +13 points closing at 10607, S& P +1 points closing at 1125 and NASDAQ +12 points closing at 2315. Looking ahead, September NAHB September Housing Market Index forecast at 14 vs. 13 previously.
The Euro (EUR) rumors in the market that Ireland may need a bailout led the EUR/USD back from month highs above 1.3150 to test support at 1.3020. The rumors were flatly denied from both the Irish Fin Minister and the IMF but the market was unable to rebound. EUR/USD traded with a low of 1.3019 and a high of 1.3159 before closing at 1.3042.
The Japanese Yen (JPY) the market was very hesitant to move on the USD/JPY after the BOJ intervention sent traders to the sidelines. The whole day USD/JPY stayed and in a 30 pip range and even weak US data was unable to prompt a pull back. Overall the USDJPY traded with a low of 85.60 and a high of 85.92 before closing the day around 85.74 in the New York session.
The Sterling (GBP) was bought up through resistance into the Europe session, continuing its rally before Euro weakness finally pulled the resurgent pound lower. EUR/GBP is beginning to be sold on rallies and support at 0.8300 is eyed by the bears. Overall the GBP/USD traded with a low of 1.5598 and a high of 1.5728 before closing the day at 1.5650 in the New York session.
The Australian Dollar (AUD) rallied into Europe to fresh two year highs before profit takers pushed the pair lower in the US session. AUD/JPY was very buoyant above the Y80 level and traders are eyeing Y82.50 as the next bull target. Overall the AUD/USD traded with a low of 0.9352 and a high of 0.9468 before closing the US session at 0.9365. Looking ahead, RBA Governor Stevens speaks.
Oil & Gold (XAU) the precious metal continued to print fresh all time highs above $1280. Overall trading with a low of USD$1283 and high of USD $1272 before ending the New York session at USD$1274 an ounce. Oil continued to fall with support struggling to be found. WTI Oil Closed -$0.95 at $73.65 a barrel.
TECHNICAL COMMENTARY
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.2588 |
1.2919 |
1.3050 |
1.3187 |
1.3334 |
|
USD/JPY |
82.88 |
83.99 |
85.75 |
85.93 |
86.70 |
|
GBP/USD |
1.5297 |
1.5449 |
1.5650 |
1.5731 |
1.5999 |
|
AUD/USD |
0.9171 |
0.9351 |
0.9380 |
0.9458 |
0.9500 |
|
XAU/USD |
1232.00 |
1263 |
1275 |
1300 |
1324.00 |
|
OIL/USD |
71.00 |
72.50 |
73.70 |
75.00 |
76.00 |
Euro – 1.3050
Initial support at 1.2919 (Sep 6 low) followed by 1.2588 (Aug 24 low). Initial resistance is now located at 1.3187 (Aug 11 low) followed by 1.3334 (Aug 6 High)
Yen – 85.75
Initial support is located at 83.99 (61.8% retrace of 82.88-85.78) followed by 82.88 (Sept 15 low). Initial resistance is now at 85.93 (Sep 16 high) followed by 86.70 (38.2% retrace of 92.89-81.88).
Pound – 1.5650
Initial support at 1.5449 (Sept 15 low) followed by 1.5297 (Sept 7 low). Initial resistance is now at 1.5731 (61.8% retrace of 1.5999-1.5297) followed by 1.5999 (Aug 6 high).
Australian Dollar – 0.9380
Initial support at 0.9351 (Sept 17 low) followed by the 0.9171 (Sep 9 low). Initial resistance is now at 0.9458 (Apr 14 high) followed by 0.9500 (Round Number).
Gold – 1275
Initial support at 1263 (Sept 15 low) followed by 1232 (Aug 31 low). Initial resistance is now at 1300 (Round Number) followed by 1324 (1263.20 plus 1.618 of 1236.80-1274.95).
Oil – 73.70
Initial support at 72.50 (Intraday Support) followed by 71.00 (Intraday Support). Initial resistance is now at 75.00 (Intraday Resistance) followed by 76.00 (Intraday Resistance).
Written by Anthony Darvall
