FOREX Trading Australia – Foreign Exchange Market Summary
Dolllar
- Dollar got more than it bargained for with the CPI outcome, which eventually worked against it and ended another day on the back foot. Core CPI recorded its largest rise in 2 years and while this is positive for the market looking for continued rate hikes from the Fed, the negatives emanating from such a sharp rise outweigh the positives.
Euro
- The Euro broke above 1.31 as investors are concerned about the effect of the surge in
U.S.
Yen
- The Yen failed to break below Dollar bids around 106.50 but managed to close below 107. It remains under pressure on its crosses on the prospect of a weak result in tomorrow’s Tertiary Industry activity outcome while an uncertain global economic direction is also weighing in on it. This mornings Trade Balance data has seen surplus shrink as imports continue to outweigh exports.
Pound
- The Pound continued to rally on the back of positive data results with profit taking on a break above 1.92 preventing further gains for now. BoE meeting minutes revealed the unchanged ratio of members in favour of staying out on rates at 7:2 but it is likely to change in the next meeting as Mortgage lending has increased while today’s retail sales result is expected to show a rise.
Australian Dollar
- The Australian dollar is looking to break above 0.78 with buyers coming on dips below 0.7725. General Greenback weakness and increase in key commodity prices has helped improve sentiment for the Aussie. However for a decisive break higher the market is still waiting on local inflation data and next RBA meeting.
Economic Data Released
|
GMT |
Release |
Region |
Previous |
Actual |
Outcome |
|
|
|
March M4 |
|
10.8Bn |
13.0Bn |
Lending has increased more than expected as housing market shows signs of improvement |
|
|
|
March CPI m/m |
|
0.4% |
0.6% |
Should inch higher but after PPI core CPI could disappoint to the downside. |
|
|
|
|
|
|
|
|
|
Upcoming Economic Releases
|
GMT |
Release |
Region |
Previous |
Forecast |
Expectation |
|
|
March Retail Sales m/m |
|
0.2% |
0.4% |
Seasonal factors likely to help increase sales. |
|
|
March Leading |
|
0.1% |
-0.3% |
Expected decline due to high oil prices and mixed consumer confidence |
|
|
Philly Fed Manufacturing |
|
11.4 |
15.5 |
Should inch higher after last period’s decline but overall picture remains mixed |
*Only key potential market moving data is mentioned, for a detailed Economic Calendar please click on the ‘Financial Calendar’ link on the web-site.
FOREX Technical Analysis
EUR/USD – Yesterday’s low was 1.2991 and high was 1.3105.
The pair closed at 1.3099.
The pair has broken above 1.31 with mild resistance in the 1.3130-50 zone and a stronger one around 1.32. Break of every key level should brief bouts of profit taking but for now the market is looking to buy on dips. On the downside mild support lied in the 1.3035-50 zone with strong buying interest on any dips below 1.30.
Key resistance is seen at 1.3155 followed by 1.3255 while support starts at 1.3045 followed by 1.2975.
USD/JPY – Yesterday’s low was 106.59 and high was 107.47.
The pair closed at 106.94.
The pair finally broke below 107 but decent Dollar bids remain in the 106.50-75 region and is likely to push back into the 107 region with resistance having moved down to 107.50. Prospect of poor Japanese data tomorrow is keeping the pair in a mixed direction with data outcome eyed.
Key Resistance is seen at 107.45 followed by 107.95 while support starts at 106.45 followed by 105.85.
GBP/USD – Yesterday’s low was 1.9096 and high was 1.9217.
The pair closed at 1.9185.
The Pound continues to rally as it benefits from poor data from other regions, key resistance levels were broken before profit taking ensured further gains beyond 1.9225. Resistance is very strong in the 1.9280-1.93 region with
Key Resistance is seen at 1.9255 followed by 1.9325 while support starts at 1.9125 followed by 1.9075.
Australian Dollar
AUD/USD – Yesterday’s low was 0.7708 and high was 0.7767.
The pair closed at 0.7755.
Dollar’s weakness helped it break back above 0.77 but resistance lies in the 0.7755-70 zone with a decisive break needed to rally towards 0.78; Strong resistance exists in the 0.7810-25 zone. On the downside it has found a good base around 0.7675-0.77 with the market looking to buy on any dips below 0.77.
Key Resistance is seen at 0.7775 followed by 0.7825 while support starts at 0.7705 followed by 0.7645.
Kunal ‘Kris’ Sharma
Forex Analyst
Australian Financial Services License 246566
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