Currency Updates:
The Australian Dollar (AUD): The pair made two attempts in early Europe session to run stops above 0.9410 but failed and slid back towards 0.9385 as NY started. Bulls started to lose hope as USD slide lost steam. The AUD then slid from NY high of 0.9407, broke the s-t support & traded near 0.9365 before bouncing back to 0.9380 where it sat late in the day to leave it up near 0.25% on the day.
AUD/USD: A close within the weekly cloud remains elusive, signs grow that that the rally will persist. Day/week RSIs provide positive momentum and retails accounts (contrarian) are building short AUD positions. A clean break above the cloud base put April high in play. Action for AUD/USD in a Asia may be driven by AUD/JPY reaction to Japan GDP and BOJ’s Kuroda speech. Should both be JPY positive AUD/USD’s rally may have to wait.
EUR/USD: Tight range of 1.3705/30 were played on the pair. Rallies failed to hold above the daily cloud base as offers into the 100 DMA and 21 WMA for spec & corp accounts loomed. The pair could move a bit on BOJ Kuroda’s speech as EURJPY could impact the EUR/USD. If no reaction, then market await for German & French GDP and EZ CPI. Soft reading may lead to a break of support in the 1.3670 area.
USD/JPY Other than a tiny blip up after US PPI came in above forecast, USD/JPY remained near the 101.71 session lows in NorAm trading. Hefty bids noted at 101.70 on the toy, with good Japanese bids noted at 101.50 on top of the string of higher swing lows since Feb’s 100.76 nadir and the 200-DMA at 101.16 last. Today’s lows are by the breached up TL from last June and the lower 21-day Bolli band. Weighing on the dollar today were the big drop in Tsy yields and stocks, with Nikkei futures down about 1.3% at last glance. That the weekly Kijun is now at 102.50 and by well-touted exporters and spec offers into the daily Cloud base at 102.44 casts something of the pall on prices this week. EUR/JPY is well below the 140 Cloud, prior lows & Fibo supports in the wake of the Reuters report sketching out what easing measures the ECB’s likely to take in June and despite Weidmann’s attempts to walk back any near-term QE expectations. GBP/JPY & AUD/JPY got tagged today, the former probing its up TL from Nov ’12 and the latter producing an outside down day. JPY Q1 GDP & MOF flow data tonight. Post-tax-hike data far more important to BOJ QQE2 hopes now.
Looking Ahead – Economic Data (GMT)
• 12:00 NZ PMI Apr 58.40-prev
• 01:30 AU New Motor Vehicle Sales m/m Apr -0.30%-prev
• 23:50 JP Foreign Bond Investment w/e 70.8b-prev
• 23:50 JP Foreign Invest JP Stock w/e 195.9b-prev
• 23:50 JP GDP QQ Q1 f/c 1.00%, 0.20%-prev
• 23:50 JP GDP QQ Ann Q1 f/c 4.20%, 0.70%-prev
• 23:50 JP GDP private consumption (q/q) Q1 f/c 2.10%, 0.40%-prev
• 23:50 JP GDP QQ Capital Expend. Q1 f/c 2.10%, 0.80%-prev
• 23:50 JP GDP QQ External Demand Q1 f/c -0.40%, -0.50%-prev
• 05:00 JP Consumer Conf. Index Apr 37.5-prev
Looking Ahead – Events, Other Releases (GMT)
• : RBA Head of Financial Stability Department Luci Ellis speaks at Citibank Residential Housing Conference in Sydney