U.S. Dollar Trading (US) decent us economic data with June Retail Sales at 0.1% vs. -0.1% forecast and Weekly Jobless Claims at 405k vs. 427k previously. The Dollar consolidated Wednesday's losses to end higher with comments from Bernanke paring back expectations of QE3 helping support. In US stocks, DJIA -58 points closing at 12446, S&P -5 points closing at 1313 and NASDAQ -20 points closing at 2781. Looking ahead, June CPI forecast at -0.1% vs. 0.2% previously m/m. July UoM Consumer Sentiment forecast at 72.5 vs. 71.5 previously.

The Euro (EUR) fell back under 1.4200 as the Dollar selling on the Moody's downgrade ran out of steam. With Bernanke stating FED not yet ready for action the market tested lower 1.41 levels. EUR/GBP is under heavy selling pressure with Pound outperformance in recent sessions. Overall the EUR/USD traded with a low of 1.4114 and a high of 1.4272 before closing the day around 1.4170 in the New York session. Looking ahead, May Trade Balance previously at -4.1bn.

The Japanese Yen (JPY) found support under Y79 and some sharp buying spooked shorts into thinking the BOJ was entering the market and day highs were seen in quick succession before falling back and pivoting the Y79 level. Overall the USD/JPY traded with a low of 78.45 and a high of 79.62 before closing the day around 79.15 in the New York session.

The Sterling (GBP) held onto gains against the USD well and strengthened against the Euro in a continuation of the recent rally this week. The market is cautiously coming back to the GBP which has been under heavy selling pressure due to deteriorating economic data and outlook. Overall the GBP/USD traded with a low of 1.6093 and a high of 1.6188 before closing the day at 1.6160 in the New York session.

The Australian Dollar (AUD) tracked the Euro lower on profit taking and then hit day lows after Bernanke signaled QE3 was not on the table currently. Interest to buy on dips is still evident and the prices of some crosses are still attractive with AUD/JPY under Y85. Overall the AUD/USD traded with a low of 1.0692 and a high of 1.0788 before closing the day at 1.0725 in the New York session.

Oil & Gold (XAU) Fresh all-time highs above $1590 reversed on Bernanke comments but the mood is still very bullish on the precious metal. Overall trading with a low of USD$1578 and high of USD $1594 before ending the New York session at USD$1585 an ounce. Oil face heavy selling pressure paring back recent gains towards the key $95 level. WTI Oil Closed -$2.36 at $95.70 a barrel.



TECHNICAL COMMENTARY

Currency

Sup 2

Sup 1

Spot

Res 1

Res 2

EUR/USD

1.3837

1.3951

1.4180

1.4295

1.4375

USD/JPY

76.25

78.00

79.10

80.38

80.83

GBP/USD

1.5781

1.5906

1.6160

1.6254

1.6300

AUD/USD

1.0520

1.0580

1.0735

1.0802

1.0889

XAU/USD

1564.00

1572

1585

1600

1628

OIL/USD

92.50



95.00

95.70

98.00

99.00



Euro - 1.4180

Initial support at 1.3951 (Jul 13 low) followed by 1.3837 (Jul 13 low). Initial resistance is now located at 1.4295 (61.8% retrace of 1.4578-1.3837) followed by 1.4375 (Jul 7 high)



Yen - 79.10

Initial support is located at 78.00 (Big Figure support) followed by 76.25 (Mar 17 low). Initial resistance is now at 80.38 (Jul 12 high) followed by 80.83 (Jul 11 high).

Pound - 1.6160

Initial support at 1.5906 (Jul 13 low) followed by 1.5781 (Jul 12 low). Initial resistance is now at 1.6254 (61.8% retrace of 1.6547-1.5781) followed by 1.6300 (Big Figure).



Australian Dollar - 1.0735

Initial support at 1.0580 (Jul 13 low) followed by the 1.0520 (Jun 29 low). Initial resistance is now at 1.0802 (Jul 14 low) followed by 1.0889 (May 11 high).

Gold - 1585

Initial support at 1572 (Jul 14 low) followed by 1564 (Jul 13 low). Initial resistance is now at 1600 (Key Resistance) followed by 1628 (1462.45 plus 0.618 of 1577.57-1308.25).



Oil - 95.70

Initial support at 95.00 (Intraday Support) followed by 92.50 (Intraday Support). Initial resistance is now at 98.00 (Intraday resistance) followed by 99.00 (Intraday Resistance).





Written by Anthony Darvall