Currency Updates:
U.S. Dollar Trading (USD) little respite was seen yesterday on the markets with more stock losses and increased safe haven demand for the USD. Spanish and Italian Yields continued to soar and the EU officials stated that Greece was badly off target in implementing austerity targets. After the bell we saw heavy selling of US stocks when heavyweight Tech stock Apple missed badly. Looking ahead, June New Home Sales forecast at 0.37mln vs. 0.369mln previously.
The Euro (EUR) the selling continued overnight but still at a slower pace down to 1.2040 in striking distance of the big 1.2000 level. Lots of speculation of what the ECB and EU can do to stop the Spanish yields rising have be talked about in the market but we are waiting for official announcements. The longer we wait the further we fall with the market left to its own devices have little love for Euro against any pair.
The Japanese Yen (JPY) USD/JPY remained just above the Y78 level with support so far at the level as the BOJ ramps up its concern that the Yen is too strong. EUR/JPY fell back towards Y94 and is tracking the major EUR/USD closely. Further Yen strength is still possible even as we approach all-time lows closer to Y90 on the EUR/JPY.
The Sterling (GBP) the GBP/USD remained very calm while the rest of the market swirled around it sticking to the 1.5500 level. EUR/GBP fell back below 0.7800 and found support at 0.7775. Looking ahead, July German IFO forecast at 104.7 vs. 105.3. UK Q2 Preliminary GDP forecast at -0.2% vs. -0.3% previously.
Australian Dollar (AUD) continued to act as the risk currency of choice tracking stocks lower for a second day and losing ground even against the Euro with the potential for even bigger losses in the event of a market crash. The EUR/AUD and GBP/AUD has been a source of strength for the Aussie in recent weeks and if the market unwinds these trades the AUD/USD may collapse. Update Q2 CPI at 0.5% vs. 0.6% forecast Q/Q.
Oil & Gold (XAU) Gold grinded higher with support found under $1570 and closed above $1580 in stable trade. OIL/USD consolidated the large falls on Monday and is finding support under $88.
