Daily Outlook - Greece Rating Cut, Commodities Bounce

By @ibtimes on

U.S. Dollar Trading (USD) was mixed gaining against most currencies courtesy of the Euro weakness but lost ground against commodities which all recovered. Stock markets rallied around the world with bargain hunters taking advantage of the recent pullback. In US stocks, DJIA +45 points closing at 12684, S&P +6 points closing at 1346 and NASDAQ +15 points closing at 2843. Looking ahead, April Import Prices forecast at 1.8% vs. 2.7% previously.

The Euro (EUR) a brief recovery rally was abruptly ended in the European session when S&P cut Greece's rating. The March German Trade Balance was very strong at 15.2b vs. 12.5bn previously. The market found support under 1.4300 and was able to bounce in the US to roughly opening levels. Overall the EUR/USD traded with a low of 1.4253 and a high of 1.4443 before closing the day around 1.4370 in the New York session. Looking ahead, Q2 Swiss Consumer Confidence forecast at 10.

The Japanese Yen (JPY) the Yen was sold against most currencies to begin the day but the US session saw crosses fall back to opening levels with the market struggling to hold onto gains. EUR/JPY slumped to Y115 but was able to find support and consolidate. Overall the USD/JPY traded with a low of 80.16 and a high of 80.84 before closing the day around 80.30 in the New York session.

The Sterling (GBP) April UK Halifax HPI fell 1.4% m/m and kept the recovery limited. When Greece was downgraded the Pound fell in sympathy but was able to rebound to opening levels as well later in the US session. Overall the GBP/USD traded with a low of 1.6270 and a high of 1.6406 before closing the day at 1.6395 in the New York session.

The Australian Dollar (AUD) the Aussie did well tracking the stock markets higher and shrugging off the Euro weakness. Commodities led by Oil and Gold helped the Aussie to break briefly above 1.0800 but this level proved solid resistance. Overall the AUD/USD traded with a low of 1.0708 and a high of 1.0813 before closing the day at 1.0795 in the New York session. UPDATE March Trade Balance soars 1740mn vs. 438mn forecast.

Oil & Gold (XAU) was well supported throughout the day as silver bounced aggressively. Overall trading with a low of USD$1493 and high of USD $1514 before ending the New York session at USD$1513 an ounce. Oil was bought from the open to rally back above $100 and surge to $103 before easing back in aggressive move. WTI Oil Closed +$5.37 at $102.55 a barrel.

TECHNICAL COMMENTARY

Currency

Sup 2

Sup 1

Spot

Res 1

Res 2

EUR/USD

1.4158

1.4205

1.4335

1.4500

1.4756

USD/JPY

78.83

80.00

80.30

81.28

81.69

GBP/USD

1.6246

1.6308

1.6410

1.6544

1.6661

AUD/USD

1.0443

1.0579

1.0785

1.0878

1.0953

XAU/USD

1471.00

1500

1510

1522

1551

OIL/USD

97.00

100.00

101.10

103.00

105.00

Euro - 1.4335

Initial support at 1.4205 (Apr 19 low) followed by 1.4158 (Apr 18 low). Initial resistance is now located at 1.4500 (Big Figure Resistance) followed by 1.4756 (61.8% retrace of 1.4940-1.4457)

Yen - 80.30

Initial support is located at 80.00 (Big Figure support) followed by 78.83 (Mar 18 low). Initial resistance is now at 81.28 (May 3 low) followed by 81.69 (May 2 High).

Pound - 1.6410

Initial support at 1.6308 (Apr 20 low ) followed by 1.6246 ( low). Initial resistance is now at 1.6544 (May 5 high) followed by 1.6661 (May 3 high).

Australian Dollar - 1.0785

Initial support at 1.0579 (May 6 low) followed by the 1.0443 (Apr 19 low). Initial resistance is now at 1.0878 (May 4 high) followed by 1.0953 (May 3 high).

Gold - 1510

Initial support at 1500 (Big Figure support) followed by 1471 (May 6 low). Initial resistance is now at 1522 (May 22 high) followed by 1551 (May 3 high).

Oil - 101.10

Initial support at 100.00 (Intraday Support) followed by 97.00 (Intraday Support). Initial resistance is now at 103.00 (Intraday resistance) followed by 105.00 (Intraday Resistance).

Written by Anthony Darvall

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