Stocks Soaring, Dollar Steady

U.S. Dollar Trading (USD) was able to hold on to small gains against most majors even as the stock market continued to rally in the US session. Most of the gains were in the European session as the market sold the Euro. February Existing Home Sales were at 5.02mn vs. 5.0mn forecast. In US stocks, DJIA +102 points closing at 10888, S&P +8 points closing at 1174 and NASDAQ +19 points closing at 2415. Looking ahead, February Durable Goods Orders are forecast at 0.7% vs. 2.6% previously. Also released, February New Home Sales are forecast at 0.32mn vs. 0.309mn previously.

The Euro (EUR) tracked news flows related to the Greece situation with German support in focus. Chances of an IMF led rescue are increasing as the EU disagreements continue. Overall the EUR/USD traded with a low of 1.3475 and a high of 1.3569 before closing at 1.3505. Looking ahead, March IFO is forecast at 95.8 vs. 95.2 previously. Also released, March PMI Manufacturing is forecast at 54 vs. 54.2 previously.

The Japanese Yen (JPY) kept to an extremely tight range given the stock market moves with EUR/JPY and GBP/JPY selling capping the major at the 90.40 region. AUD/JPY was able to grind above Y83 but was lacking conviction. Overall the USDJPY traded with a low of 90.11 and a high of 90.49 before closing the day around 90.45 in the New York session. Looking ahead, February Trade Balance is forecast at 366bn vs. 85 bn previously.

The Sterling (GBP) pushed below the 1.5000 briefly in the European session on weak economic data but then managed a small bounce in the US session. March Distributive Trades at 13 vs. 15 forecast weighed. Overall the GBP/USD traded with a low of 1.4972 and a high of 1.5116 before closing the day at 1.5030 in the New York session. Looking ahead, UK Budget Released.

The Australian Dollar (AUD) was capped at 0.9200 even as stocks rallied impressively. AUD/JPY was strong but weakness in the Euro weighed. Support was seen below 0.9150 through Europe as the range continues to tighten. AUD/NZD managed to reclaim the 1.3000 level however as the Aussie outpaced most currencies. Overall the AUD/USD traded with a low of 0.9135 and a high of 0.9201 before closing the US session at 0.9190.

Oil & Gold (XAU) broke below $1100 in Europe before recovering well in the US session. Overall trading with a low of USD$1093 and high of USD$1108 before ending the New York session at USD$1103 an ounce. Crude Oil managed small gains as stocks rallied. Crude Oil was up $0.23 ending the New York session at $81.80.

TECHNICAL COMMENTARY

       

Currency

Sup 2

Sup 1

Spot

Res 1

Res 2

EUR/USD

1.3405

1.3436

1.3505

1.3627

1.3741

USD/JPY

89.27

89.63

90.40

90.80

91.09

GBP/USD

1.4873

1.4932

1.5045

1.5257

1.5382

AUD/USD

0.9056

0.9085

0.9195

0.9252

0.9280

XAU/USD

1088.00

1092

1105.00

1108

1124.00

OIL/USD

78.00

80

81.60

83.2

85.00

Euro - 1.3505

Initial support at 1.3436 (Mar 2 low) followed by 1.3405 (0.618 of 1.2330-1.5144). Initial resistance is now located at 1.3627 (Mar 19 high) followed by 1.3741 (Mar 18 high)

Yen - 90.40

Initial support is located at 89.63 (Mar 16 low) followed by 89.27 (Mar 9 low). Initial resistance is now at 90.80 (Mar 16 high) followed by 91.09 (Mar 12 high).

Pound - 1.5045

Initial support at 1.4932 (Mar 22 low) followed by 1.4873 (Mar 10 low). Initial resistance is now at 1.5257 (Mar 19 high) followed by 1.5382 (Mar 17 low).

Australian Dollar - 0.9195

Initial support at 0.9085 (Mar 22 low) followed by the 0.9056 (Mar 9 low). Initial resistance is now at 0.9252 (Mar 17 high) followed by 0.9280 (Jan 18 high).

Gold - 1105

Initial support at 1092 (Mar 22 low) followed by 1088 (Feb 25 low). Initial resistance is now at 1108 (Mar 22 high) followed by 1124 (0.618 of 1144.98-1092.47).

Oil - 81.50

Initial support at 80.00 (Intraday Support) followed by 78.00 (Intraday Support). Initial resistance is now at 83.20 (March High) followed by 85.00 (Key level).