Australian FOREX Daily Outlook 23/04/2010

Greece Situation Deteriorates

CURRENCY TRADING SUMMARY – 23rd April (00:30GMT)

U.S. Dollar Trading (USD) was stronger across the board as the the biggest currency pair in the world in the EUR/USD slumped to fresh year lows as the Turmoil in Greece intensified. Weekly Jobless Claims improved to 456k vs. 480k previously. In US stocks, DJIA +9 points closing at 11134, S&amp P +2 points closing at 1209 and NASDAQ +14 points closing at 2519. Looking ahead, March Durable Goods Orders are forecast at 0.3% vs. 0.9% previously. Also released, March New Home Sales are forecast at 0.33mn vs. 0.308mn.

The Euro (EUR) concerns over Greece debt saw the Yield surge to over 600bps higher than Germany debt and Portugal and Spain debt also jumped higher. Rumors swept through Europe that Greece may have to restructure 270bn worth of Sovereign debt. Overall the EUR/USD traded with a low of 1.3201 and a high of 1.3423 before closing at 1.3220. Looking ahead, April German IFO forecast at 98.6 vs. 98.1. Also Released, February Industrial Orders forecast at 0.8% vs. 2.0% previously.

The Japanese Yen (JPY) had a mixed day as risk aversion in Europe was reversed late in the US session as Equities rallied into the close. USD/JPY was the strongest pair rallies to week highs near Y93.60 as US data and Bond Yields improved. Overall the USDJPY traded with a low of 92.73 and a high of 93.66 before closing the day around 93.50 in the New York session.

The Sterling (GBP) weaker than expected March Retail Sales kept the Pound under pressure against the USD but EUR/GBP selling and good GBP/JPY buying off lows limited Cable losses. The second debate was held on Thursday night and could influence price action on Friday with focus on the possibility of a Hung parliament. Overall the GBP/USD traded with a low of 1.5319 and a high of 1.5476 before closing the day at 1.5390 in the New York session. Looking ahead, Q1 GDP is forecast at 0.4%.

The Australian Dollar (AUD) tracked the stock markets and Broader USD strength but held up better than the European currencies as the Australian economy outperformed fundamentally. EUR/AUD is testing all time low at 1.4300 and is danger of falling further as the Greece sage continues. Overall the AUD/USD traded with a low of 0.9226 and a high of 0.9306 before closing the US session at 0.9260.

Oil &amp Gold (XAU) traded in a wide range testing $1150 before crashing nearly $20 an ounce in the US session. Overall trading with a low of USD$1131 and high of USD$1150 before ending the New York session at USD$1142 an ounce. Ended Flat in a mixed day of trading. WTI Oil Closed +$0.02 at $83.70 a barrel.

TECHNICAL COMMENTARY

Euro – 1.3225

Initial support at 1.3343 (Apr 9 high) followed by 1.3270 (Mar 25 low). Initial resistance is now located at 1.3692 (Apr 12 high) followed by 1.3816 (Mar 17 high)

Yen – 93.45

Initial support is located at 91.46 (0.500 of 88.14-94.79) followed by 90.66 (61.8% retracement of 88.13 – 94.77). Initial resistance is now at 93.77 (Apr 9 high) followed by 94.27 (Apr 7 High).

Pound – 1.5340

Initial support at 1.5130 (Apr 6 low) followed by 1.5044 (Mar 31 low). Initial resistance is now at 1.5522 (Apr 15 low) followed by 1.5688 (Feb 18 low).

Australian Dollar – 0.9245

Initial support at 0.9131 (Mar 31 low) followed by the 0.9035 (Mar 29 low). Initial resistance is now at 0.9364 (Apr 15 high) followed by 0.9406 (Nov 16 high).

Gold – 1140

Initial support at 1123 (Apr 19 low) followed by 1122 (Apr 7 low). Initial resistance is now at 1164 (April 12 high) followed by 1183 (0.764 of 1126.56-1044.85).

Oil – 83.80

Initial support at 82.50 (Intraday Support) followed by 80.00 (Intraday Support). Initial resistance is now at 85.00 (March high) followed by 86.00 (Intraday Resistance).