U.S. Dollar Trading (US) a major relief rally was staged overnight with commodities and stocks soaring on positive debt news and US housing data. June Housing starts gained +14.6%m/m in a sharp and promising rise. Talk that a US debt deal was getting to closer to having bipartisan support also helped reduce the downgrade threat the US is facing. In US stocks, DJIA +202 points closing at 12587, S&P +21 points closing at 1326 and NASDAQ +61 points closing at 2826. Looking ahead, June Existing Home Sales forecast at 4.9mln vs. 4.81mn previously.
The Euro (EUR) the Euro gained to the 1.4200 level on the back of the positive sentiment change and some progress on the second Greece Bailout plan ahead of Thursday EU Summit. German ZEW was poor falling to -15.1 vs. -9 previously. Overall the EUR/USD traded with a low of 1.4067 and a high of 1.4218 before closing the day around 1.4155 in the New York session. Looking ahead, German PPI forecast at 0.0% vs. 0.0%.
The Japanese Yen (JPY) the USD/JPY found support under Y79 and finished near the highs of the recent range on strong cross buying. AUD/JPY reclaimed the Y85 level with the 200 point gain in the Dow Jones providing the fuel for the rise. Overall the USD/JPY traded with a low of 78.80 and a high of 79.29 before closing the day around 79.25 in the New York session. Looking Ahead, June Trade Balance forecast at -165bn vs. -853bn previously.
The Sterling (GBP) rallied with the rest of the risk currencies but found resistance at last week highs near 1.6180. The market is volatile with news coming from both directions lately and providing plenty of trading opportunities between 1.5900-1.6200. Overall the GBP/USD traded with a low of 1.6053 and a high of 1.6180 before closing the day at 1.6120 in the New York session. Looking ahead, MPC Minutes forecast at 2-7-0.
The Australian Dollar (AUD) the Aussie shrugged off weakness in Asia on the back of neutral RBA minutes to track the stock markets and break back above 1.0735. The RBA has dropped the need to raise rates at some stage from their minutes this month with a more balanced view of the economy which had shown some signs of slowing in recent months. Overall the AUD/USD traded with a low of 1.0607 and a high of 1.0645 before closing the day at 1.0730 in the New York session.
Oil & Gold (XAU) pushed higher to $1610 before coming under heavy liquidation on sharp profit taking and slipped over $25 an ounce. Overall trading with a low of USD$1582 and high of USD $1610 before ending the New York session at USD$1589 an ounce. Oil continued to range trade in the $95-98 region back higher on strong risk appetite. New WTI Oil Contract. WTI Oil Closed +$1.57 at $97.50 a barrel.
|Currency||Sup 2||Sup 1||Spot||Res 1||Res 2|
Euro - 1.4165
Initial support at 1.4069 (Jul 19 low) followed by 1.4014 (Jul 18 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 - 79.20
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 - 1.6130
Initial support at 1.6006 (Jul 18 low) followed by 1.5939 (61.8% retrace of 1.5781-1.6194). Initial resistance is now at 1.6177 (Jul 15 high) followed by 1.6300 (Big Figure).
Australian Dollar - 1.0735
Initial support at 1.0561 (Jul 18 low) followed by the 1.0520 (Jun 29 low). Initial resistance is now at 1.0746 (Jul 15 high) followed by 1.0889 (May 11 high).
Gold - 1589
Initial support at 1572 (Jul 14 low) followed by 1564 (Jul 13 low). Initial resistance is now at 1613 (Channel upper drawn from Jul 1 low on 60 min chart) followed by 1628 (1462.45 plus 0.618 of 1577.57-1308.25).
Oil - 98.65
Initial support at 98.00 (Intraday Support) followed by 95.00 (Intraday Support). Initial resistance is now at 99.00 (Intraday resistance) followed by 100.00 (Intraday Resistance).
Written by Anthony Darvall