FOREX Trading Australia – Market Summary
· Dollar remained confined to narrow movements as the market awaits today’s release of the minutes of the Fed’s meeting. The tone is expected to be on the same lines as the last meeting with recent increase in spending & jobs growth likely to offset the tame inflation figures thus the Fed should keep its measured tone intact. A bit of profit taking had led the Dollar come off its highs but driving factors from other currencies continue to be on the weak side.
· The Euro dipped towards 1.2535 but decent sized hedge fund bids exists down towards 1.25 with the Euro stabilizing around 1.2550. The Zone continues to be plagued by political uncertainty as the German Chancellor Schroeder proposed election to be held this fall, a year earlier than scheduled. This surprising announcement came after his party lost the elections in
· The Yen failed to break below strong Dollar bids around 107.50 but has managed to remain below 108. This morning’s Tertiary Industry index fell more than expected as the economy fails to pick up. But the Yen is helped by a rally on the Nikkei as oil prices have eased and given the recent strong pick up in
· The Pound came off its lows on profit taking on a day devoid of any key releases from both sides of the Atlantic but faces mild resistance around 1.8315 and has closed below 1.83. The Pound is in oversold territory for the short term but the data released this week is expected to highlight the higher growth prospects for the
· The Aussie remained confined to its recent range with any foray above 0.76 once again leading to decent selling interest. It needs to break decisively above 0.7625 or below 0.7525 to get a clear direction. Downside looks more likely with any break below 1.25 likely to lead to the acceleration of losses.
Economic Data Released
|
GMT |
Release |
Region |
Previous |
Actual |
Comment |
|
|
March Tertiary Industry Index |
|
-1.0% |
-0.4% |
Index should continue to remain in negative territory as tertiary industry remains subdued. |
Upcoming Economic Releases
|
GMT |
Release |
Region |
Previous |
Forecast |
Comment |
|
|
April Consumer Spending |
|
-0.8% |
0.5% |
Expected to bounce back on cyclical factors but overall trend remains weak. |
|
|
Q1 Total Biz Investment |
|
0.2% |
0.1% |
Should decline as economy is getting into a sluggish state |
|
|
May ZEW Economic Sentiment survey |
|
20.1 |
21.0 |
Should improve slightly on easing in oil prices. |
|
|
Minutes of FOMC’s May 3rd meeting |
|
_ |
_ |
Fed’s measured tone should stay intact. |
*Only key potential market moving data is mentioned, for a detailed Economic Calendar please click on the ‘Financial Calendar’ link on the web-site.
Technical Analysis
EUR/USD – Yesterday’s low was 1.2534 and high was 1.2596.
The pair closed at 1.2572.
The Euro losses accelerated after the recent strong support around 1.26 gave way. Bottom pickers failed to push it higher and promptly liquidated their positions. For now mild support exists in the 1.2525-45 support zone. With a break below 1.25 likely to accelerate losses as sentiment has turned against it in a strong way with
Key resistance is seen at 1.2625 followed by 1.2695 while support starts at 1.2525 followed by 1.2465.
USD/JPY – Yesterday’s low was 107.54 and high was 108.20.
The pair closed at 107.64
The pair is back to square one after the highly speculated Yuan revaluation didn’t eventuate. Data outcomes remain weak with
Key Resistance is seen at 108.25 followed by 108.95 while support starts at 107.55 followed by 106.85.
GBP/USD – Yesterday’s low was 1.8242 and high was 1.8318.
The pair closed at 1.8289.
The Pound’s fundamentals remain on the weak side thus it continues to be offered on any minor rallies with mild resistance around 1.8325 and very strong resistance around 1.84. On the downside, bottom pickers failed to keep it above 1.83 with mild support around 1.8225. Distant support is seen in the 1.8125-50 zone with mixed technical interest above that region.
Key Resistance is seen at 1.8325 followed by 1.8405 while support starts at 1.8225 followed by 1.8155.
AUD/USD – Yesterday’s low was 0.7547 and high was 0.7600.
The pair closed at 0.7592.
The pair targeted the strong support zone at 0.7530-45 but failed to break below as strong bids lie in that zone. A break below 0.75 pivot mark could accelerate losses. On the upside, 0.7625-40 now holds strong resistance. Key
Key Resistance is seen at 0.7625 followed by 0.7675 while support starts at 0.7525. followed by 0.7475.
Kunal ‘Kris’ Sharma
Forex Analyst
E-mail: kris@easy-forex.com
Australian Financial Services License 246566
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