FOREX Trading Australia – Foreign Exchange Market Summary
Dollar
· Dollar slipped on Friday with the market determined to move the prices one way or the other and when even a strong Payrolls number of 262K failed to boost the Dollar, many long positions built up in anticipation of a strong post Payrolls rally, were promptly liquidated. Unemployment rate inched higher while wage growth remains sluggish. The immense build up over the last few days of a very strong payrolls number with talk of result being around 300 K led the eventual result to work against the Greenback.
Euro
· The Euro having found a good base around 1.3075 rallied back above 1.32 post payrolls outcome. It is again confronted with the stiff 1.3275-1.3310 resistance zone with the Euro staying below 1.33 for two months now. Speculators have sharply increased their net Euro positions as worries about
Yen
· The Yen has decent buying interest on any Dollar foray above 105.50 and post payrolls the Yen managed to rally towards 104.50 with the Dollar finding support around that level. Dollar has stronger support above 103.75 with the outcome of Japanese data expected to provide further clues.
Pound
· The Pound managed to rally by more than 200 points going back above 1.9250, it has resistance in the 1.9275-90 zone but sentiment is positive as the market retains a faint hope of a rate hike this week. Housing data on Friday was mixed with the HBOS survey revealing a decline while the FT survey showing prices were steady, but there is no doubt about the trend of prices with Housing market definitely cooling off. However continuous strong data outcome form other sectors would make other MPC’s members to jump on the bandwagon of another hike.
Australian Dollar
· The Australian dollar was sitting on a strong position going into the Payrolls outcome given the unexpected rise in the Building approvals data thus the eventual Dollar sell-off helped the Aussie go back towards 0.7925. With the market expecting another rate hike, 0.80 remains as the target but it has to go past the stiff option barriers laced between 0.7950-0.80.
Economic Data Released
|
GMT |
Release |
Region |
Previous |
Actual |
Outcome |
|
|
|
|
|
2.7% |
1.7% |
Improvement in other sectors of the economy has helped the building sector. |
|
|
|
January Retail Trade |
Euro-Zone |
0.2% |
0.3% |
Below expectations in spite of post holiday discounts. |
|
|
|
January Factory |
|
8.2% |
-3.4% |
Orders have declined with mixed domestic demand |
|
|
|
February Non Farm Payrolls |
|
146K |
262K |
A Healthy outcome but unemployment rate has inched higher. |
|
Upcoming Economic Releases
|
GMT |
Release |
Region |
Previous |
Forecast |
Expectation |
|
|
Q4 Capital Spending |
|
13.9% |
10.8% |
Spending should remain on steady levels. |
|
|
February Bloomberg Retail |
Euro-Zone |
49.9 |
49.6 |
Should remain depressed as growth fails to pick up. |
|
|
January Consumer Credit |
|
$3.1Bn |
$5.2Bn |
Expected to inch higher. |
Technical Analysis
EUR/USD – Friday’s low was 1.3088 and high was 1.3253.
The pair closed at 1.3236.
Mixed
Key resistance is seen at 1.3285 followed by 1.3315 while support starts at 1.3155 followed by 1.3075.
USD/JPY – Friday’s low was 104.32 and high was 105.56.
The pair closed at 104.75.
Dollar weakness has sent it back into the 104 region but it is still within its recent range with decent Dollar bids above 104 but 105.50 continuing to hold stiff resistance for this pair with stronger selling interest above 106.
Key Resistance is seen at 105.55 followed by 105.95 while support starts at 104.20 followed by 103.75.
GBP/USD – Friday’s low was 1.9047 and high was 1.9271.
The pair closed at 1.9222.
The Pound rallied back above 1.92 but 1.9270-90 continues to hold strong resistance, with a break above leads us to 1.9325. On the downside good support should continue on dips down to 1.9150 with decent buying interest above 1.9075.
Key Resistance is seen at 1.9285 followed by 1.9345 while support starts at 1.9145 followed by 1.9055.
Australian Dollar
AUD/USD – Friday’s low was 0.7811 and high was 0.7933.
The pair closed at 0.7906.
It has managed to regain the 0.79 mark but 0.7950 mark continues to hold resistance with option barriers laced between 0.7950-0.80. On the downside good buying interest should crop on dips below 0.7850 with strong support above 0.7775.
Key Resistance is seen at 0.7955 followed by 0.7995 while support starts at 0.7855 followed by 0.7805.
Kunal ‘Kris’ Sharma
Forex Analyst
Australian Financial Services License 246566
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