Bernanke Comments on Dollar
CURRENCY TRADING SUMMARY – 17th November (00:30GMT)
U.S. Dollar Trading (USD) was on the back foot for most of the day as Global equities remained buoyant in the wake of the APEC meeting confirming stimulus and declining to comment on the USD. Fed Chief Bernanke did however support the dollar and for a short period in the US session the USD surged off fresh year lows as the market digested his comments. Doubts about the conviction of the FED to support the dollar though saw these gains pared back into the close with stock markets finishing at fresh Year highs. US retail Sales were strong at 1.4% in October vs. 0.9% forecast. In US Stocks, DJIA +136 points closing at 10406, S& P +15 points closing at 1109 and NASDAQ +29 points closing at 2197. Looking ahead, US October PPI is forecast at 0.6% vs. -0.6% previously.
The Euro (EUR) had a wild trading day gaining heavily with stocks and oils but was pummeled lower on Bernanke’s pro USD comments before reversing these losses to make fresh highs above 1.5000. October EU CPI was at 0.3% as forecast. EUR/JPY struggled to track the improved risk appetite as USD/JPY dived to month lows. Overall the EUR/USD traded with a low of 1.4879 and a high of 1.5018 before closing at 1.4975. looking ahead, September EU Trade Balance forecast at -0.9Bn vs. 1.0Bn previously.
The Japanese Yen (JPY) was broadly strong as the USD/JPY melted on Dollar concerns below the 89 Yen level. Most crosses struggled to hold gains with even the risk trade AUD/JPY struggling to maintain gains whilst stocks were at year highs and gold continued to surge. Japan Q3 GDP at 1.2% vs. 0.7% forecast. Overall the USDJPY traded with a low of 88.73 and a high of 89.73 before closing the day around 89.10 in the New York session.
The Sterling (GBP) was very solid rallying up to fresh month highs above 1.6800 on continued cross recovery and generally strong risk appetite. EUR/GBP broke below 0.8900 support and GBP/JPY continued to test the 150 Yen level. Overall the GBP/USD traded with a low of 1.6667 and a high of 1.6881 before closing the day at 1.6830 in the New York session. Looking ahead, October CPI is forecast at 1.4% vs. 1.1% previously.
The Australian Dollar (AUD) broke above 0.9400 for fresh year highs as risk appetite and the weak USD pushed the commodity currency higher. Adding to the rally was Oil and golds large moves higher with the only risk stemming from the speed of the recent AUD rise and the technically overbought conditions this brings. Overall the AUD/USD traded with a low of 0.9315 and a high of 0.9408 before closing the US session at 0.9375. Looking ahead, RBA Minutes released from November’s meeting are important for clues of December potential rate rise.
Oil & Gold (XAU) rallied with little reprieve all day. Overall trading with a low of USD$1122 and high of USD$1144 before ending the New York session at USD$1138 an ounce. Played catch up with commodities and general risk appetite. Crude Oil was up $2.55 ending the New York session at $78.90.
TECHNICAL COMMENTARY
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.4786 |
1.4822 |
1.4975 |
1.5048 |
1.5063 |
|
USD/JPY |
88.00 |
88.73 |
89.10 |
90.60 |
91.32 |
|
GBP/USD |
1.6519 |
1.6572 |
1.6825 |
1.6843 |
1.7043 |
|
AUD/USD |
0.9196 |
0.9211 |
0.9375 |
0.9476 |
0.9637 |
|
XAU/USD |
1095.00 |
1101 |
1138.00 |
1144.00 |
1150.00 |
|
OIL/USD |
76.00 |
78.00 |
78.90 |
80.00 |
82.00 |
Euro – 1.4975
Initial support at 1.4822 (Nov 12 low) followed by 1.4786 (0.618 of 1.4624-1.5049). Initial resistance is now located at 1.5048 (Nov 11 high) followed by 1.5063 (Oct 26 high)
Yen – 89.10
Initial support is located at 88.73 (Nov 16 low) followed by 88.00 (Big Figure). Initial resistance is now at 90.60 (Nov 12 high) followed by 91.32 (Oct 29 high).
Pound – 1.6825
Initial support at 1.6572 (Nov 13 low) followed by 1.6519 (Nov 12 low). Initial resistance is now at 1.6843 (Nov 9 high) followed by 1.7043 (Aug 5 high).
Australian Dollar – 0.9375
Initial support at 0.9211 (Nov 12 low) followed by the 0.9196 (Nov 9 low). Initial resistance is now at 0.9476 (Jul 31 ‘ 08 high) followed by 0.9637 (Jul 24 ’08 high).
Gold – 1138
Initial support at 1101 (Nov 13 low) followed by 1095 (Nov 9 high). Initial resistance is now at 1144 (Nov 16 high) followed by 1150 (Big Level).
Oil – 78.90
Initial support at 78.00 (Intraday support) followed by 76 (Intraday support). Initial resistance is now at 80 (key level) followed by 82 (October high).
