Nikkei Crash sends Global stocks tumbling
CURRENCY TRADING SUMMARY – 27th October 2008 (00:30GMT)
·U.S. Dollar Trading (USD) extended gains against all currencies except the Yen as risk aversion ran unchecked through the markets and panic spread. Emerging currencies collapsed triggering overwhelming dollar demand. Oil crumbled to year lows and the Euro spooked by contagion fears hit levels not seen since 2006. One small positive was US stocks recovered from lows and September Existing Home Sales jumping 5.5% to 5.18Mln. In the U.S. share markets, the NASDAQ was down 51.88 points (-3.23%) and the Dow Jones was down 312 points (-3.59%). Crude Oil closed down $3.69 ending the New York session at $64.15 per barrel. Looking ahead, New Home Sales are expected at 0.45Mln vs. 0.46Mln.
·The Euro (EUR) Downside pressure reemerged after a brief retest of 1.30. Concerns over Ukraine and other emerging Eastern European Economies ability to repay debt led to concerns countries within the EU may face trouble and create disunity for the single currency. On the Data front EU Manufacturing PMI was at 41.3 vs. 44 expected in October, a record low. Overall the EUR/USD traded with a low of 1.2496 and a high of 1.3007 before closing the day at 1.2625 in the New York session. Looking ahead, October German IFO is expected at 91.2 vs. 92.9.
·The Japanese Yen (JPY) was the strongest currency of the day as demand for a safe haven soared. Year lows against the USD and multiyear lows against the pound saw technical resistance give way and panic buying emerge. EUR/JPY hit all time lows under 115. Overall the USDJPY traded with a low of 90.87 and a high of 98.08 before closing the day around 94.30 in the New York session.
·The Sterling (GBP) traded with a very weak tone after Q3 GDP came in at -0.5% vs. -0.2% expected. Cable lost ground across the board testing .8000 against the Euro and over 15 big figures against the Yen. The Pound recovered off lows going into the weekend as US stocks recovered from lows. Overall the GDP/USD traded with a low of 1.5260 and a high of 1.6290 before closing the day at 1.5900 in the New York session.
·The Australian Dollar (AUD) took the brunt of the risk aversion falling all day as AUD/JPY capitulated. AUD/USD hit New Year lows under 0.6100. Oil continued to fall and Gold broke below $700 an ounce at the height of the USD strength adding to the Aussie slide. Overall the AUD/USD traded with a low of 0.6055 and a high of 0.6745 before closing the US session at 0.6225.
·Gold (XAU) broke through $700 an ounce as Oil slumped and investors dumped the precious metal on deflation fears and cash needs. The recovery in US shares prompted a relief rally to day highs. Overall trading with a low of USD$682.80 and high of USD$741.20 before ending the New York session at USD$734 an ounce.
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.2334 |
1.2497 |
1.2585 |
1.3078 |
1.3359 |
|
USD/JPY |
90.00 |
90.93 |
93.20 |
98.32 |
100.57 |
|
GBP/USD |
1.5000 |
1.5269 |
1.5805 |
1.6327 |
1.7198 |
|
AUD/USD |
0.5929 |
0.6057 |
0.6165 |
0.7076 |
0.7239 |
|
XAU/USD |
600.00 |
671.49 |
736.00 |
745.15 |
750.00 |
·Euro – 1.2585
Initial support at 1.2497 (Oct 24 low) followed by 1.2334 (April 24 2006). Initial resistance is now located at 1.3078 (Oct 22 high) at followed by 1.3359 (Oct 21 high).
·Yen – 93.20
Initial support is located at 90.93 (Oct 24 low) followed by 90.00 (Key level). Initial resistance is now at 98.32 (Oct 24 high) followed by 100.57 (Oct 22 high).
·Pound – 1.5805
Initial support at 1.5269 (Oct 24 low) followed by 1.5000 (Key level). Initial resistance is now at 1.6327 (Oct 24 high) followed by 1.7198 (Oct 21 high).
·Australian Dollar – 0.6165
Initial support at 0.6057 (Oct 24 low) followed by the 0.5929 (April 07 2003 low). Initial resistance is now at 0.7076 (Oct 15 high) followed by 0.7239 (Oct 14 high).
·Gold – 736
Initial support at 671.49 (Sept 04 2007 low) followed by 600 (Key Level). Initial resistance is now at 745.15 (Oct 24 high) followed by 750 (Key Level).
