U.S. Dollar Trading (US) was on the front foot as mild risk aversion spread throughout the market and the EUR/USD slumped in a delayed reaction to the Portugal downgrade the night before. June ISM Services dropped to 53.3 vs. 54.6 previously. China also increased Interest rates but stock markets were able to end slightly higher in the US. In US stocks, DJIA +56 points closing at 12626, S&P +1 points closing at 1339 and NASDAQ +8 points closing at 2834. Looking ahead, Weekly Jobless Claims forecast at 421k vs. 428k previously. June ADP employment forecast at 67k vs. 38k previously.
The Euro (EUR) was under pressure as Europe reacted to the Portugal downgrade the night before in the US session. The major plummeted to 1.4300 but support was found and consolidated ahead of todays expected rate rise from the ECB. Overall the EUR/USD traded with a low of 1.4285 and a high of 1.4468 before closing the day around 1.4325 in the New York session. Looking ahead, ECB Rate forecast to rise 0.25% to 1.5% vs. 1.25% previously. Focus on Trichet's Press Conference 45mins after announcement.
The Japanese Yen (JPY) step down just under Y81 but kept to a 20 pip range with all the action on the crosses. EUR/JPY led the rest down below Y116 before consolidating. GBP/JPY is once again back under Y130 with sentiment still very sour towards the risk sensitive cross. Overall the USD/JPY traded with a low of 80.75 and a high of 81.11 before closing the day around 80.85 in the New York session.
The Sterling (GBP) was pushed lower under the weight of heavy Euro selling and broke below 1.6000. EUR/GBP still fell however as the Pound outperformed the single currency and could pull back further if Trichet is dovish tonight. Overall the GBP/USD traded with a low of 1.5945 and a high of 1.6093 before closing the day at 1.5995 in the New York session. Looking ahead, BOE Rate announcement forecast at 0.5%.
The Australian Dollar (AUD) range traded for most of the day under pressure due to the Euro led USD strength and China rate hike but supported from strong Gold and US stocks which ignored the negative news. Overall the AUD/USD traded with a low of 1.0653 and a high of 1.0735 before closing the day at 1.0690 in the New York session. UPDATE JUNE EMPLOYMENT Very Strong at 23.4k vs. 7.8k previously.
Oil & Gold (XAU) Gold pushed higher with the resurgence of sovereign debt risk in Europe. Overall trading with a low of USD$1510 and high of USD $1534 before ending the New York session at USD$1529 an ounce. Oil found support on a dip to $96 before ending unchanged. WTI Oil Closed -$0.05 at $96.80 a barrel.
|Currency||Sup 2||Sup 1||Spot||Res 1||Res 2|
Euro - 1.4445
Initial support at 1.4284 (61.8% of 1.4103-1.4578) followed by 1.4215 (76.4% of 1.4103-1.4578). Initial resistance is now located at 1.4467 (Jul 6 high) followed by 1.4578 (Jul 4 high)
Yen - 80.85
Initial support is located at 80.29 (Jun 27 low) followed by 80.00 (Key Support). Initial resistance is now at 81.33 (Jun 2 high) followed by 81.63 (76.4% retrace of 82.23-79.7).
Pound - 1.5995
Initial support at 1.5970 (Jun 29 low) followed by 1.5822 (Jan 31 low). Initial resistance is now at 1.6200 (Psych Resistance) followed by 1.6263 (Jun 22 high).
Australian Dollar - 1.0745
Initial support at 1.0668 (Jun 30 low) followed by the 1.0520 (Jun 29 low). Initial resistance is now at 1.0790 (Jul 1 high) followed by 1.0889 (May 11 high).
Gold - 1528
Initial support at 1492 (76.4% retrace of 1462.45-1558.25) followed by 1471 (May 17 low). Initial resistance is now at 1549 (June 23 high) followed by 1558 (Jun 22 high).
Oil - 97.30
Initial support at 95.00 (Intraday Support) followed by 92.50 (Intraday Support). Initial resistance is now at 98.00 (Intraday resistance) followed by 100.00 (Intraday Resistance).
Written by Anthony Darvall