Australian FOREX Daily Outlook 07/08/2006

CURRENCY TRADING SUMMARY –7 AUGUST06 (05:00GMT)

• U.S. Dollar Trading (USD) was weaker across the board against the majors in the overnight forex market as the non-farm payroll (NFP) number from the US came in weaker than expected. NFP was forecasted to come in at 142k, but disappointed coming in at 113k. Not helping the USD, unemployment also came in worse than expected, posting a 0.2% rise to 4.8% for July where the market was anticipating it to remain steady at 4.6%. In other markets, the Dow Jones index retreated 2pts while the NASDAQ pulled back 7pts. Crude oil lost some ground falling US39c to USD$76.17 a barrel.
  

• The Euro (EUR) traded within a low of 1.2779 and a high of 1.2908, before closing at 1.2875 in the New York session.
  

• The Japanese Yen (JPY) traded within a low of 113.97 and a high of 115.55 versus the dollar, before closing at 115.01 in the New York session.

• The Sterling (GBP) traded within a low of 1.8856 and a high of 1.9127, before closing at 1.9071 in the New York session.
  

• The Australian Dollar (AUD) traded within a low of 0.7605 and a high of 0.7672, before closing at 0.7659 in the New York session.
  

• Gold (XAU) rose by US$2.00 to US$648 an ounce on the back of USD weakness.

TECHNICAL COMMENTARY

• Euro 1.2880

Initial support at 1.2776 (Aug 4 low) followed by 1.272 (Aug 1 corrective low). Initial resistance is now located at 1.2935 (Jun 6 high) followed by 1.298 (Jun 5 trend high).

• Yen 114.40

Initial support is located at 113.97 (Jul 10 low and 50% ret 108.98 to 117.89) followed by 113.45 (Jul 10 low and 50% ret 108.98 to 117.89). Initial resistance is now at 115.56 (Aug 4 high) followed by 116.04 (Jul 28 high and 50% ret 117.89 to 114.17).

• Pound – 1.9070

Initial support at 1.8852 (Aug 4 low) followed by 1.8697 (Aug 3 corrective low). Initial resistance is now at 1.913 (Aug 4 high) followed by 1.9162 (Apr 29 corrective high).

• Australian Dollar – 0.7665

Initial support at 0.7577 (38.2% retracement of the 0.7405 to 0.7684 advance) followed by 0.7512 (61.8% retracement of the 0.7405 to 0.7684 advance). Initial resistance is now at 0.7684 (Aug 2 corrective high) followed by 0.7727 (May 17 corrective high).

• Gold – 648

Initial support at 639.4 (Aug 3 low) followed by 626.7 (Jul 28 low). Initial resistance is now at 658.96 (76.4% retracement of the 676.35 to 602.66 decline) followed by 676.53 (Jul 17 high).