U.S. Dollar Trading (USD) the dollar remained weak into the weekend as stocks pushed fresh year highs and Oil and Gold surged. Bernanke spoke before Congress and commented that countries with large trade surpluses (China) should let their currencies rise. In US stocks, DJIA +73 points closing at 12391, S&P +2 points closing at 1343 and NASDAQ +2 points closing at 2833. Looking ahead, Bank Holiday for Presidents Day.
The Euro (EUR) the Euro was strong once again pushing to a new level above 1.3700 with traders focusing on comments from ECB member Smaghi that as the economy recovers and commodities rise so will the very low interest rates. Overall the EUR/USD traded with a low of 1.3546 and a high of 1.3715 before closing the day around 1.3690 in the New York session. Looking ahead, German February IFO forecast at 107.5 vs. 107.8 previously.
The Japanese Yen (JPY) was under constant selling pressure on USD/JPY as Dollar weakness pushed the pair back to Y83. Most crosses gained slightly however as EUR/USD, GPD/USD and AUD/USD outpaced to the topside. Overall the USD/JPY traded with a low of 83.04 and a high of 83.53 before closing the day around 83.10 in the New York session.
The Sterling (GBP) a larger than expected jump in January Retail Sales to 1.9% vs. -1.4% previously helped the Pound outperform and cable surge to 1.6250. Wednesday's MPC Rate Meeting Minutes will be the next major risk event for the GDP with focus on any more members moving towards a rate hike. Overall the GBP/USD traded with a low of 1.6149 and a high of 1.6262 before closing the day at 1.6250 in the New York session.
The Australian Dollar (AUD) was strong but underperformed the Euro and GBP as China raised its Banks reserve ratio once again on Friday. The AUD is very closely related to Chinese economic developments with concerns of overheating and bubble bursting the main threats to an over wise very bullish story. Overall the AUD/USD traded with a low of 1.0090 and a high of 1.0157 before closing the day at 1.0135 in the New York session.
Oil & Gold (XAU) pushed above $1390 as the market demand returned aggressively. Overall trading with a low of USD$1382 and high of USD $1392 before ending the New York session at USD$1387 an ounce. Oil remained steady but attention is focused on middle east developments. WTI Oil Closed -$0.15 at $86.30 a barrel.
Euro - 1.3700
Initial support at 1.3537 (Feb 17 low) followed by 1.3463 (Feb 16 low). Initial resistance is now located at 1.3736 (Feb 10 high) followed by 1.3825 (Feb 3 High)
Yen - 83.15
Initial support is located at 82.89 (38.2% retrace of 81.13-83.98) followed by 82.34 (Feb 10 low). Initial resistance is now at 83.75 (Feb 17 high) followed by 83.98 (Feb 16 High).
Pound - 1.6235
Initial support at 1.6076 (Feb 17 low) followed by 1.5987 (Feb 16 low). Initial resistance is now at 1.6279 (Feb 3 high) followed by 1.6279 (Feb 3 High).
Australian Dollar - 1.0135
Initial support at 1.0018 (Feb 17 low) followed by the 0.9960 (Feb 16 low). Initial resistance is now at 1.0152 (Feb 09 high) followed by 1.0189 (Feb 9 high).
Gold - 1391
Initial support at 1374 (Feb 17 low) followed by 1368 (Feb 16 low). Initial resistance is now at 1393 (Jan 13 high) followed by 1396 (76.4% retrace of 1424.05-1308.25).
Oil - 91.10
Initial support at 90.00 (Intraday Support) followed by 88.00 (Intraday Support). Initial resistance is now at 91.50 (Intraday Resistance) followed by 92.50 (Intraday Resistance).
Written by Anthony Darvall