U.S. Dollar Trading (USD) risk appetite remained strong as stock markets pushed fresh highs but the USD was able to maintain strength as selling in Asia was bought back hard in the European session. Helping the Dollar rally was the sharp drop in Oil on stabilizing middle east concerns. In US stocks, DJIA +69 points closing at 12161, S&P +8 points closing at 1319 and NASDAQ +14 points closing at 2783. Looking ahead, FOMC Member Fisher Speaks.
The Euro (EUR) rallied to 1.3600 in Asia on strong Japanese stocks and EUR/JPY buying but was sold aggressively in Europe on weak economic data. German December Factory Orders dropped -3.4%. EUR/USD traded with a low of 1.3507 and a high of 1.3628 before closing at 1.3580. Looking ahead, December Industrial Output forecast at 0.3% vs. -0.7%.
The Japanese Yen (JPY) remained in a 20 pip range consolidating the move higher on Friday. Crosses where more volatile with EUR/JPY tracking the major. Most of Asia is away for new year celebrations but should return tomorrow to create fresh volatility as they play catch up. Overall the USDJPY traded with a low of 82.14 and a high of 82.49 before closing the day around 82.30 in the New York session.
The Sterling (GBP) traded inside Friday's range as the market waited for fresh direction. GBP/JPY remains a source of support as does EUR/GBP which slipped below 0.8400. Overall the GBP/USD traded with a low of 1.6087 and a high of 1.6188 before closing the day at 1.6130 in the New York session.
The Australian Dollar (AUD) found resistance at 1.0160 on multiple occasions but with stock markets stronger the Aussie remained well supported. December Retail Sales came out at 0.2% vs. 0.4% previously. Overall the AUD/USD traded with a low of 1.0102 and a high of 1.0163 before closing the US session at 1.0135. UPDATE January Business Confidence at +4 vs. -3 previously.
Oil & Gold (XAU) stayed within a tight range grinding higher back above $1350. Overall trading with a low of USD$1344 and high of USD $1353 before ending the New York session at USD$1352 an ounce. Was sold sharply on easing Egyptian concerns and a buildup of inventories. WTI Oil Closed -$1.70 at $87.30 a barrel.
|Currency||Sup 2||Sup 1||Spot||Res 1||Res 2|
Euro - 1.3605
Initial support at 1.3571 (Jan 31 low) followed by 1.3541 (Jan 24 low). Initial resistance is now located at 1.3826 (Feb 3 high) followed by 1.3862 (Feb 2 High)
Yen - 82.30
Initial support is located at 81.13 (Feb 4 low) followed by 80.54 (Nov 9 low). Initial resistance is now at 82.93 (Jan 28 high) followed by 83.22 (Jan 27 high).
Pound - 1.6135
Initial support at 1.6059 (Jan 18 high) followed by 1.6010 (Feb 1 low). Initial resistance is now at 1.6173 (Feb 4 high) followed by 1.6299 (Nov 4 High).
Australian Dollar - 1.0135
Initial support at 1.0056 (Feb 2 low) followed by the 0.9964 (Feb 1 low). Initial resistance is now at 1.0256 (Dec 31 high) followed by 1.0300 (Big Figure Resistance).
Gold - 1351
Initial support at 1323 (Jan 31 low) followed by 1308 (Sep 28 low). Initial resistance is now at 1371 (Jan 20 high) followed by 1379 (Jan 19 high).
Oil - 87.50
Initial support at 87.00 (Intraday Support) followed by 85.00 (Intraday Support). Initial resistance is now at 88.00 (Intraday Resistance) followed by 90.00 (Intraday Resistance).
Written by Anthony Darvall