Currency Updates:
U.S. Dollar Trading (USD) the safe have Dollar continued to receive support even as global stocks rallied for another day. USD/JPY in particular is on the march higher and the EUR/USD is also heavy while the ECB bailout details are sorted out. The more traditional risk currency in the Australian Dollar was hammered with AUD/USD falling to month lows in surprising trade. Looking ahead, July National Activity Index previously at -0.15.
The Euro (EUR) the EUR/USD fell below 1.2300 bouncing into the close for only small losses on the day. The market is concerned that the bulls are running out of steam as each attempt higher has failed. The headlines out of Europe continued to be mixed with more talk than action. The next such event is Germany’s Merkal and France’s Hollande meeting on Tuesday.
The Japanese Yen (JPY) the new trend in the market seems to be gaining new followers each day as the buyers carve out daily gains. Multi-week highs were seen on Friday and this has continued on Monday in Asia with a break above the key Y79.50 level with relative ease. Yen crosses are enjoying but most majors are under pressure so gains are limited.
The Sterling (GBP) the GBP/USD eased on Friday unable to kick higher after the strong moves on Thursday and falling back to the comfortable 1.5700 level in quiet trade. GBP/AUD buying supported along with GBP/JPY moves but the major will require fresh UK news to kick it higher. Looking ahead, No economic data Monday.
Australian Dollar (AUD) the AUD/USD finally broke to the downside in a rare move on a strong stock market day. The main story is that the crosses are under pressure with EUR/AUD and GBP/AUD surging higher after months of downtrend. Some suggest that the China bear story is gaining traction and that this could take the wind out of the Aussie going forward. Looking ahead, no economic data.
Oil & Gold (XAU) XAU/USD was strong in quiet trade above $1615oz but unable to break $1620. OIL/USD continued to surge with some analyst’s pointing to the increasing Iran/Israel tensions being the main catalyst. Resistance is next seen at $98 and then $100 a barrel going forward.
