U.S. Dollar Trading (US) the markets all enjoyed solid gains throughout the day, with US data inspiring a fresh push higher. June PMI Manufacturing unexpectedly improved to 55.3 vs. 53.5 previously and forecast of a drop to 51.8. The USD was under pressure against risk assets but did well against other safe havens in Gold, Yen and Swiss Franc. In US stocks, DJIA +168 points closing at 12582, S&P +19 points closing at 1339 and NASDAQ +42 points closing at 2816. Looking ahead, Markets Closed for July 4th Holidays..
The Euro (EUR) extended gains on the strong risk appetite but topside was limited as some support came through for the USD after the strong US data. With the end of QE2 the market will be reacting to US data with more of a response to the USD itself rather than its effect on Stock markets. May EU Unemployment remained at 9.9%. Overall the EUR/USD traded with a low of 1.4434 and a high of 1.4551 before closing the day around 1.4521 in the New York session. Looking ahead, May PPI forecast at -0.1%m/m vs. 0.9%m/m previously.
The Japanese Yen (JPY) tested above Y81 after the US data but once again failed to break out of the range it has held comfortably for the last two weeks. The weak Japanese economic and business outlook was highlighted by the Q2 Tankan Survey which fell to -9 vs. +6 previously. Overall the USD/JPY traded with a low of 80.51 and a high of 81.14 before closing the day around 80.83 in the New York session.
The Sterling (GBP) was left behind in the risk rally for the 3rd day after the June UK PMI manufacturing data surprised once again to the downside at 51.3 vs. 52.0 previously. EUR/GBP is testing new highs in the 0.9000 but the recent highs are lofty and if sterling support could provide very good selling levels historically. Overall the GBP/USD traded with a low of 1.5987 and a high of 1.6095 before closing the day at 1.6075 in the New York session. Looking ahead, June PMI construction forecast at 53.7 vs. 54 previously.
The Australian Dollar (AUD) was strong tracking the stock markets higher as one of the investor's top choice for expressing risk appetite. Resistance was found towards 1.0800 before consolidating for the rest of the day. AUD/JPY is also strong above Y87 and could be poised for further gains if data and RBA decisions this week support. Overall the AUD/USD traded with a low of 1.0669 and a high of 1.0790 before closing the day at 1.0779 in the New York session.
Oil & Gold (XAU) Broke below $1500 and tested for support as the safe haven appeal of the precious metal melted away in the improving investor outlook. Overall trading with a low of USD$1478 and high of USD $1502 before ending the New York session at USD$1487 an ounce. Fell back slightly as the weeks considerable gains came under profit taking pressure. WTI Oil Closed -$0.48 at $94.90 a barrel.
|Currency||Sup 2||Sup 1||Spot||Res 1||Res 2|
Euro - 1.4550
Initial support at 1.4427 (Jun 30 low) followed by 1.4333 (Jun 29 low). Initial resistance is now located at 1.4653 (Jun 9 high) followed by 1.4697 (Jun 7 high)
Yen - 80.80
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 - 1.6075
Initial support at 1.5881 (61.8% retrace of 1.5345-1.6747) 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 - 1.0740
Initial support at 1.0520 (Jun 29 low) followed by the 1.0436 (Jun 28 low). Initial resistance is now at 1.0775 (Jun 3 high) followed by 1.0865 (76.4% retrace of 1.1012-1.0391).
Gold - 1490
Initial support at 1485 (76.4% retrace of 1462.45-1558.25) followed by 1471 (May 17 low). Initial resistance is now at 1526 (June 24 high) followed by 1523 (Jun 23 high).
Oil - 95.10
Initial support at 95.00 (Intraday Support) followed by 92.50 (Intraday Support). Initial resistance is now at 96.50 (Intraday resistance) followed by 98.00 (Intraday Resistance).
Written by Anthony Darvall