Financial stocks down, Yen Gains
CURRENCY TRADING SUMMARY – 12th August (00:30GMT)
U.S. Dollar Trading (USD) the dollar was mixed today ending little changed against the EURO and GBP but losing ground against the risk sensitive Yen. Gains were seen against commodity currencies such as the CAD with Oil breaking below $70 a barrel and investor sentiment souring in the US session. Q2 Productivity forecast at 5.3% came in at 6.4% and Q2 Labor Costs forecast at -2.4% actually dropped -5.8% as labor demand weakened. Crude Oil Closed down $1.15 at $69.45. In US share markets, S& P ended -12 points (-1.27%) at 994, NASDAQ ended -22 points (-1.13%) at 1969 and DOW JONES ended -96 points (-1.03%) at 9241. Looking ahead, June trade Balance forecast at -28.5bn vs. -25.96bn previously and FOMC meeting widely expected to remain at 0.25%.
The Euro (EUR) enjoyed modest support against the USD with traders unwilling to increase bets on the Dollar ahead of the FOMC later today. EUR/JPY dropped back below 136 Yen as stocks fell although other crosses such as the EUR/GBP supported. July German CPI is forecast at -0.1% vs. 0.4% previously was slightly better than expected at 0.0% m/m. Overall the EUR/USD traded with a low of 1.4186 and a high of 1.4111 before closing at 1.4150. Looking ahead, Industrial Production forecast at 0.3% in June.
The Japanese Yen (JPY) gained heavily on the back of USD/JPY losses and risk trades being pared back. AUD/JPY and NZD/JPY led the market lower losing over 2% as the market was caught a little ahead of itself after Friday’s Yen collapse. BOJ held at 0.1% and kept a cautious outlook. The Market will be looking for guidance from the FED and US treasury’s Auctions tonight to see if the USD/JPY rally can continue. Overall the USDJPY traded with a low of 95.76 and a high of 97.06 before closing the day around 95.90 in the New York session.
The Sterling (GBP) continued to test the low 1.6400 levels but found support and bounced into adverse conditions to give some hope to the GBP bulls that the recent rally may not be over. Junes Trade Balance at -6.5bn was worse than the -6.2bn forecast. USD strength and Risk appetite are the two main themes controlling the GBP recently so today’s performance in the US stock market and FED statement are critical. Overall the GBP/USD traded with a low of 1.6432 and a high of 1.6524 before closing the day at 1.6480 in the New York session. Looking ahead, July Claimant Count forecast at 25k vs. 23k previously and ILO Unemployment forecast at 7.7% vs. 7.6%.
The Australian Dollar (AUD) fell heavily as weak commodities and selling of risky assets hurt the Aussie which had benefited the most from the recent global rally. July NAB Business Confidence at 10 vs. 4 previously. The market is now poised at Key levels with 0.8200-0.8450 band expected to contain this week with risk skewed to the downside. Overall the AUD/USD traded with a low of 0.8277 and a high of 0.8389 before closing the US session at 0.8300. Looking ahead, August Westpac Consumer Confidence previously at 9.3%.
Gold (XAU) kept in a tight range as the USD was mixed and safe haven flows competed with a weak commodity complex. Overall trading with a low of USD$942 and high of USD$950 before ending the New York session at USD$946 an ounce.
TECHNICAL COMMENTARY
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.4008 |
1.4105 |
1.4150 |
1.4219 |
1.4447 |
|
USD/JPY |
94.02 |
95.76 |
95.95 |
97.79 |
98.89 |
|
GBP/USD |
1.6311 |
1.6432 |
1.6480 |
1.6719 |
1.6831 |
|
AUD/USD |
0.8126 |
0.8238 |
0.8290 |
0.8519 |
0.8694 |
|
XAU/USD |
925.00 |
932.00 |
945.00 |
971.00 |
990.00 |
Euro – 1.4150
Initial support at 1.4105 (Aug 10 low) followed by 1.4008 (Jul 29 low). Initial resistance is now located at 1.4219 (Aug 10 high) followed by 1.4447 (Aug 5 high)
Yen – 95.95
Initial support is located at 95.76 (Aug 11 low) followed by 94.02 (July 29 low). Initial resistance is now at 97.79 (August 7 high) followed by 98.89 (June 4 high).
Pound – 1.6480
Initial support at 1.6432 (AUG 10 low) followed by 1.6311 (Jul 22 low). Initial resistance is now at 1.6719 (AUG 10 high) followed by 1.6831 (AUG 7 high).
Australian Dollar – 0.8290
Initial support at 0.8238 (Jul 31 low) followed by the 0.8126 (July 29 low). Initial resistance is now at 0.8519 (Sept 22 high) followed by 0.8694 (Aug 28 low).
Gold – 945
Initial support at 932 (Jul 31 low) followed by 925 (July 29 low). Initial resistance is now at 971 (AUG 6 high) followed by 990 (Jun 3 high).
