Australian FOREX Daily Outlook 06/11/2009

US Unemployment Data Looming

CURRENCY TRADING SUMMARY – 6th November (00:30GMT)

U.S. Dollar Trading (USD) with stocks rallying for a 4^th day the market went back into ‘risk on’ mode and the USD was on the back foot. Weekly Jobless claims were 512k vs. 530k previously. Q3 Productivity at 9.5% was very strong vs. 6.5% forecast. In US Stocks, DJIA +203 points closing at 10005, S&amp P +20 points closing at 1066 and NASDAQ +49 points closing at 2105. Looking ahead, October Non Farm Payrolls forecast at -175k vs. -263k previously. The October Unemployment rate is forecast at 9.9% vs. 9.8% previously.

The Euro (EUR) continued to find strength on dips as US stocks soared and the ECB was relatively upbeat at their ECB meeting were they held rates at 1.0%. The pair failed to track the gains completely on Wall st. as the market pauses ahead of the US Unemployment data tonight. Overall the EUR/USD traded with a low of 1.4810 and a high of 1.4920 before closing at 1.4880. looking ahead, September Industrial Orders are forecast at 1% vs. 1.45 previously.

The Japanese Yen (JPY) was strong is Asia as the Nikkei fell but then was sold for most of the day as the US had its biggest rally in 2 months. AUD/JPY and GBP/JPY led the rebound but the market was well contained again as the event risk of the NFP today contained risk appetite. Overall the USDJPY traded with a low of 89.97 and a high of 90.84 before closing the day around 90.75 in the New York session. Looking ahead, September Leading Indicators previously at 0.8%.

The Sterling (GBP) shot higher as the BoE increased the Asset purchase program by 25bn vs. 50bn forecast. The BoE held rates at 0.5%. The market found resistance above 1.6600 and settled below the figure. EUR/GBP support was in the low 0.89’s. GBP/JPY reclaimed the 150 Yen level. Overall the GBP/USD traded with a low of 1.6639 and a high of 1.6464 before closing the day at 1.6580 in the New York session. Looking ahead, UK PPI Output prices are forecast at 0.3% vs. 0.5% m/m previously.

The Australian Dollar (AUD) good data could not help the Aussie rally in Asia as AUD/JPY selling dragged the pair to day lows before a change in sentiment pushed the pair higher once again in the US. September Trade Balance at -1.85bn vs. -2.1bn forecast. Overall the AUD/USD traded with a low of 0.9023 and a high of 0.9127 before closing the US session at 0.9105. Looking ahead, RBA Monetary Policy Statement.

Oil &amp Gold (XAU) consolidated gains settling just under $1100 level. Overall trading with a low of USD$1083 and high of USD$1095 before ending the New York session at USD$1091 an ounce. Fell back below $80 a barrel on profit taking after recent 3 day rally. Crude Oil was down $0.78 ending the New York session at $79.62.

TECHNICAL COMMENTARY

Euro – 1.4875

Initial support at 1.4702 (Nov 4 low) followed by 1.4626 (Nov 3 low). Initial resistance is now located at 1.4917 (Nov 5 high) followed by 1.4927 (Oct 27 high)

Yen – 90.85

Initial support is located at 89.99 (Nov 5 low) followed by 89.20 (Nov 2 low). Initial resistance is now at 91.32 (Nov 4 high) followed by 91.62 (Oct 29 high).

Pound – 1.6575

Initial support at 1.6402 (Nov 4 low) followed by 1.6241 (Oct 19 low). Initial resistance is now at 1.6693 (Oct 23 high) followed by 1.6742 (Sept 11 high).

Australian Dollar – 0.9110

Initial support at 0.8971 (Nov 4 low) followed by the 0.8907 (Nov 2 low). Initial resistance is now at 0.9144 (Nov 4 high) followed by 0.9218 (Oct 27 high).

Gold – 1091

Initial support at 1080 (Nov 4 low) followed by 1055 (Nov 3 high). Initial resistance is now at 1097 (Nov 4 high ) followed by 1100 (Psychological level).

Oil – 79.80

Initial support at 78.5 (Intraday Support) followed by 78.0 (Intraday support). Initial resistance is now at 81 (Nov 5 high) followed by 82 (October High).