CURRENCY TRADING SUMMARY - 8th September (00:30GMT)
U.S. Dollar Trading (USD) continued to be sold on Monday although the market kept to tight ranges as the US was away on Holidays. Asian and European stocks rallied on the lead from US stocks Friday and commodities ended unchanged to slightly higher although Oil was sluggish once again. Looking ahead, July Consumer Credit forecast at -$4Bn vs. -$10Bn previously.
The Euro (EUR) continued to be buoyant as fresh gains in Asian stocks sent EUR/JPY higher and Economic data in Europe underpinned gains into the 1.4300's. July German Industrial Orders at 3.5% vs. 2% forecast. EUR/GBP was supported on GBP concerns ahead of the UK rate decision Thursday. Overall the EUR/USD traded with a low of 1.4288 and a high of 1.4362 before closing at 1.4335. Looking ahead, July German Trade Balance forecast at 11.4bn vs. 11bn previously. Also released, July German Industrial Output forecast at 1.5% vs. -0.1%.
The Japanese Yen (JPY) the Yen was sold across the board as the weekend affirmation by the G20 to continue with global stimulus helping to keep risk appetite and the re-inflation trade going. GBP/JPY gains were unsustainable and USD/JPY ended at the 93 Yen figure roughly were it began. NZD/JPY and AUD/JPY held onto modest gains. Overall the USDJPY traded with a low of 92.82 and a high of 93.31 before closing the day around 93.05 in the New York session.
The Sterling (GBP) had a large bounce going into Europe as news of a $16bn takeover offer of Cadbury from Kraft led to speculation of substantial M&A buying. This enthusiasm waned as the offer was rejected and attention turned to the MPC rate announcement on Thursday which has the potential to create further GBP downside if the Asset Purchase program is increased again from the current 175bn pounds. Overall the GBP/USD traded with a low of 1.6327 and a high of 1.6444 before closing the day at 1.6340 in the New York session. Looking ahead, July Industrial Output forecast at 0.2% vs. 0.5% previously. Also released, Manufacturing Production forecast at 0.3% vs. 0.4% previously.
The Australian Dollar (AUD) opened at year highs and continued upward with the major technical break of 0.8480 fueling fresh buying from multiple sources. Strong Gold and stocks helped to underpin with the only concern being continued weakness in Oil. Overall the AUD/USD traded with a low of 0.8507 and a high of 0.8578 before closing the US session at 0.8350. Looking ahead, August NAB Business Confidence previously at 10.
Gold (XAU) kept in a tight range holding above $990 an ounce with the market consolidating recent ranges just under the key $1000 an ounce level. Overall trading with a low of USD$989 and high of USD$996 before ending the New York session at USD$995 an ounce.
|Currency||Sup 2||Sup 1||Spot||Res 1||Res 2|
Euro - 1.4335
Initial support at 1.4178 (Sept 1 low) followed by 1.4046 (AUG 17 low). Initial resistance is now located at 1.4407 (Aug 27 high) followed by 1.4447 (Aug 5 high)
Yen - 93.05
Initial support is located at 91.74 (July 13 low) followed by 90.54 (February 13 low). Initial resistance is now at 94.07 (August 28 high) followed by 95.06 (Aug 14 high).
Pound - 1.6350
Initial support at 1.6237 (Sept 3 low) followed by 1.6114 (Sept 1 low). Initial resistance is now at 1.6546 (Aug 24 high) followed by 1.6665 (Aug 26 high).
Australian Dollar - 0.8555
Initial support at 0.8379 (Sept 4 low) followed by the 0.8239 (AUG 27 low). Initial resistance is now at 0.8694 (Aug 28 2008 high) followed by 0.8813 (AUG 22 2008 high).
Gold - 995
Initial support at 944 (Aug 31 low) followed by 939 (Aug 24 low). Initial resistance is now at 997 (Sept 3 high) followed by 1000 (Psychological Round Number).