Equities Rebound after 6 days of losses
CURRENCY TRADING SUMMARY – 25th February 2009 (00:30GMT)
·U.S. Dollar Trading (USD) gave up some strength as traders took profits and risk appetite surged on Yen weakness and the largest stock rally in a month. Bernanke put a dampener on speculation US banks may be nationalized. US Consumer Confidence dropped much more than expected to 25 vs. 35.5 forecast. Crude Oil closed up $1.52 ending the New York session at $39.96 per barrel. In US share markets, the Nasdaq was up 54 points or 3.90% whilst the Dow Jones gained 236 points or 3.32%. Looking ahead, Existing Home Sales forecast at 4.79 vs. 4.74.
·The Euro (EUR) took advantage of the equity rally to break above 1.2800. German IFO dropped to 82.6 vs. 83.2 previously whilst December Industrial Orders also dropped to -5.2% vs. -4.2% previously. EUR/JPY broke resistance at 1.22 and helped to propel the major higher. Overall the EUR/USD traded with a low of 1.2664 and a high of 1.2877 before closing the day at 1.2850. Looking ahead, German Q4 GDP forecast to be confirmed at -2.1%.
·The Japanese Yen (JPY) broke above 95 on the USD/JPY and dragged all the crosses higher. With stocks rallying the pair extended gains to fall just short of 97. GBP/JPY reclaimed 140 and EUR/JPY nearly breached 125. AUD/JPY also responded to the increase in risk appetite breaking to the topside. Overall the USDJPY traded with a low of 94.28 and a high of 96.92 before closing the day around 96.70 in the New York session. Looking ahead, January Trade Balance forecast at -1.1Tn vs. -320Bn previously.
·The Sterling (GBP) had a mixed day with the pair struggling to keep up with the gains of other currencies such as the Euro and AUD. Cable struggled to maintain 1.4500 and fell back to support at 1.4400. GBP/JPY did maintain its recent rally though. February CBI distributive trades were much better than forecast at -25 vs. -47 previously. Overall the GBP/USD traded with a low of 1.4377 and a high of 1.4577 before closing the day at 1.4520 in the New York session. Looking ahead, Q4 GDP is forecast at -1.6% vs. -1.5%.
·The Australian Dollar (AUD) took advantage of the rebound in equities to reclaim the 0.6500 level. Early in Asia the 0.6400 level held firm and this provided bulls with the ammunition to test the topside. AUD/JPY buying emerged and also helped underpin the move higher. Overall the AUD/USD traded with a low of 0.6390 and a high of 0.6537 before closing the US session at 0.6510.
·Gold (XAU) fell back sharply after Bernanke poured cold water on banking nationalization plans. The failure to break $1000 convincingly also inspired profit taking. Overall trading with a low of USD$959 and high of USD$995 before ending the New York session at USD$962 an ounce.
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.2513 |
1.2558 |
1.2870 |
1.2997 |
1.3093 |
|
USD/JPY |
92.52 |
94.26 |
96.75 |
96.94 |
97.43 |
|
GBP/USD |
1.4153 |
1.4365 |
1.4525 |
1.4662 |
1.4780 |
|
AUD/USD |
0.6249 |
0.6333 |
0.6535 |
0.6577 |
0.6643 |
|
XAU/USD |
940.00 |
959.00 |
961.00 |
1005.00 |
1012.00 |
·Euro – 1.2870
Initial support at 1.2558 (Feb 20 low) followed by 1.2513 (Feb 18 low). Initial resistance is now located at 1.2997 (Feb 11 low) at followed by 1.3093 (Feb 9 high)
·Yen – 96.75
Initial support is located at 94.26 (Feb 24 low) followed by 92.52 (Feb 18 low). Initial resistance is now at 96.94 (Feb 24 high) followed by 97.43 (Nov 25 high).
·Pound – 1.4525
Initial support at 1.4365 (Feb 23 low) followed by 1.4153 (Feb 20 low). Initial resistance is now at 1.4662 (Feb 24 high) followed by 1.4780 (Fibonacci retracement).
·Australian Dollar – 0.6535
Initial support at 0.6333 (Feb 18 low) followed by the 0.6249 (Feb 2 low). Initial resistance is now at 0.6577 (Feb 16 high) followed by 0.6643 (Feb 13 high).
·Gold – 961
Initial support at 959 (Feb 24 low) followed by 940 (Feb 17 low). Initial resistance is now at 1006 (Feb 20 high) followed by 1012 (Mar 18 high).
