Bernanke Fed Chairman Talks Exit Strategy
CURRENCY TRADING SUMMARY – 11th February (00:30GMT)
U.S. Dollar Trading (USD) was on the backfoot as Eurozone bailout talks supported the Euro before reversing direction in the US session as Fed Chairman Bernanke outlined possible beginnings of an exit strategy. December Trade Balance fell to -40bn vs. -36 forecast. In US stocks DJIA -20 points closing at 10038, S& P -2 points closing at 1068 and NASDAQ -3 points closing at 2147. Looking ahead, Weekly Jobless Claims are forecast at 465k vs. 480k previously.
The Euro (EUR) spiked higher in Europe above 1.3800 on comments that German support for Greece may extend to more than just loan support. Stock Weakness and uncertainty as to the details of the EU support sent the Major lower once again. Overall the EUR/USD traded with a low of 1.3675 and a high of 1.3814 before closing at 1.3735. Looking ahead, EU Summit.
The Japanese Yen (JPY) dipped on risk aversion and weakness in crosses before Bernanke’s speech outlining the draining of Liquidity helped give the dollar a bid tone and helped US Yields rise. The medium term outlook is still dependent on stock market direction and the appetite of investors to return to the carry trade. Overall the USDJPY traded with a low of 89.23 and a high of 90.08 before closing the day around 89.95 in the New York session.
The Sterling (GBP) was sold off after the BOE inflation report and comments from King that inflation and Growth outlook are expected to be lower than previously forecast. December Industrial Production jumped to 0.5% vs 0.2% previously. Overall the GBP/USD traded with a low of 1.5570 and a high of 1.5768 before closing the day at 1.5591 in the New York session.
The Australian Dollar (AUD) was once again beholden to moves from the Euro hitting highs in Europe before testing support in the US session. December Home Loans were -5.5% vs. -4.8% previously. Overall the AUD/USD traded with a low of 0.8708 and a high of 0.8795 before closing the US session at 0.8750. Looking ahead, January Employment change is forecast at 15k vs. 35k previously. Unemployment Rate is forecast at 5.6% vs. 5.5% previously.
Oil & Gold (XAU) stayed within familiar ranges finding resistance at $1080. Overall trading with a low of USD$1063 and high of USD$1083 before ending the New York session at USD$1073 an ounce. Oil found support on news of fresh Iran sanctions. Crude Oil was up +$0.61 ending the New York session at $74.36.
TECHNICAL COMMENTARY
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
EUR/USD |
1.3622 |
1.3643 |
1.3740 |
1.3839 |
1.3903 |
USD/JPY |
88.83 |
89.15 |
89.95 |
90.55 |
91.08 |
GBP/USD |
1.5536 |
1.5562 |
1.5600 |
1.5776 |
1.5888 |
AUD/USD |
0.8579 |
0.8615 |
0.8750 |
0.8797 |
0.8830 |
XAU/USD |
1044.00 |
1061 |
1074.00 |
1083 |
1089.00 |
OIL/USD |
70.00 |
72.50 |
74.70 |
75.00 |
77.00 |
Euro – 1.3740
Initial support at 1.3643 (Feb 9 low) followed by 1.3622 (Feb 8 low). Initial resistance is now located at 1.3839 (Feb 9 high) followed by 1.3903 (Feb 4 high)
Yen – 89.95
Initial support is located at 89.15 (Feb 8 low) followed by 88.83 (Feb 5 low). Initial resistance is now at 90.55 (0.382 of 93.77-88.56) followed by 91.08 (Feb 4 high).
Pound – 1.5600
Initial support at 1.5562 (Feb 8 low) followed by 1.5536 (Feb 8 low). Initial resistance is now at 1.5776 (Feb 5 high) followed by 1.5888 (0.382 of 1.6458-1.5536).
Australian Dollar – 0.8750
Initial support at 0.8615 (Feb 9 low) followed by the 0.8579 (Feb 5 low). Initial resistance is now at 0.8797 (Feb 9 high) followed by 0.8830 (Feb 4 high).
Gold – 1074
Initial support at 1061 (Feb 8 low) followed by 1044 (Feb 5 low). Initial resistance is now at 1083 (Feb 9 high) followed by 1089 (0.382 of 1161.80-1044.85).
Oil – 74.70
Initial support at 72.50 (Intraday Support) followed by 70.00 (Intraday Support). Initial resistance is now at 75.00 (Intraday Resistance) followed by 77.00 (Intraday Resistance).