U.S. Dollar Trading (USD) gained against its two biggest pairs in the Euro and Yen as Greece concerns resurfaced and rumors of a French ratings downgrade hurt the Dollar alternatives. March Consumer Confidence improved to 52.5 vs. 46.4 previously. Also released, January Case Shiller increased 0.3% vs. -0.7% previously. In US stocks, DJIA +11 points closing at 10907, S&P +0 points closing at 1173 and NASDAQ +6 points closing at 2410. Looking ahead, March ADP Employment Report forecast at 40k vs. -20k previously.

The Euro (EUR) fell aggressively after failing above 1.3500 in early Europe when rumors of a French ratings downgrade swept the market. A denial from S&P did little to stem the selling with nervous buyers heading to the exits. Overall the EUR/USD traded with a low of 1.3394 and a high of 1.3539 before closing at 1.3415. Looking ahead, German March Unemployment rate forecast flat at 8.2% with an Unemployment Change of +10k.

The Japanese Yen (JPY) USD/JPY weakness in Asia was reversed in Europe and the US session as the trend resumed. GBP/JPY buying helped as the risk sensitive pair surged above Y140 for the first time in a month. February Industrial Production at -0.9% vs. -0.5% forecast. Overall the USDJPY traded with a low of 92.11 and a high of 93.04 before closing the day around 92.85 in the New York session.

The Sterling (GBP) was the strongest currency in the market yesterday as economic data beat expectations in the important housing and GDP releases. Q4 GDP was revised up to 0.4% vs. 0.3% forecast and March HPI jumped 0.7% vs. 0.2% m/m forecast. EUR/GBP was a major mover dropping from 0.9000 to 0.8900. Overall the GBP/USD traded with a low of 1.4972 and a high of 1.5130 before closing the day at 1.4980 in the New York session.

The Australian Dollar (AUD) struggled above 0.9200 as the Euro and Gold fell but is still well supported on dips ahead of next weeks RBA rate announcement where the odds of a rate hike are firming. AUD/JPY is close to Y85.60 key resistance on the topside. Overall the AUD/USD traded with a low of 0.9165 and a high of 0.9218 before closing the US session at 0.9190. UPDATE February Retail Sales are forecast at -1.4% vs. 0.2% previously.

Oil & Gold (XAU) tracked the Euro down towards $1100 support. Overall trading with a low of USD$1101 and high of USD$1113 before ending the New York session at USD$1103 an ounce. Oil was steady gained a small amount ahead of today's key US inventories report. Crude Oil was up +$0.20 ending the New York session at $82.37.

TECHNICAL COMMENTARY

       

Currency

Sup 2

Sup 1

Spot

Res 1

Res 2

EUR/USD

1.3247

1.3270

1.3430

1.3537

1.3569

USD/JPY

91.09

91.77

93.00

93.02

93.77

GBP/USD

1.4704

1.4784

1.5085

1.5127

1.5159

AUD/USD

0.8936

0.8978

0.9205

0.9216

0.9250

XAU/USD

1078.00

1085

1103.00

1114

1133.00

OIL/USD

80.00

82

82.50

83.2

85.00

Euro - 1.3430

Initial support at 1.3270 (March 26 low) followed by 1.3247 (May 6 low). Initial resistance is now located at 1.3537 (Mar 30 high) followed by 1.3569 (Mar 23 high)

Yen - 93.00

Initial support is located at 91.77 (Mar 25 low) followed by 91.09 (Mar 24 low). Initial resistance is now at 93.02 (Mar 30) followed by 93.77 (Jan 8 high).

Pound - 1.5085

Initial support at 1.4784 (Mar 1 low) followed by 1.4704 (April 30 low). Initial resistance is now at 1.5127 (Mar 30 high) followed by 1.5159 (0.618 of 1.5381-1.4799).

Australian Dollar - 0.9205

Initial support at 0.8978 (Mar 4 low) followed by the 0.8936 (Mar 1 low). Initial resistance is now at 0.9216 (Mar 30 high) followed by 0.9250 (March 17 high).

Gold - 1103

Initial support at 1085 (Mar 24 low) followed by 1078 (Feb 12 low). Initial resistance is now at 1114 (Mar 29 high) followed by 1133 (Mar 17 high).

Oil - 82.50

Initial support at 82.00 (Intraday Support) followed by 80.00 (Intraday Support). Initial resistance is now at 83.20 (Intraday Resistance) followed by 85.00 (Intraday Resistance).