U.S. Dollar Trading (USD) with selling overdone on Friday the market was buoyant seeing most pairs gain against the Dollar. Oil was extremely strong with Brent Crude breaking above $101 a barrel. Economic Data was strong with Chicago PMI jumping to 68.8 vs. 66.8 previously. In US stocks, DJIA +68 points closing at 11891, S&P +9 points closing at 1286 and NASDAQ +13 points closing at 2670. Looking ahead, January ISM Manufacturing forecast at 58 vs. 58.5 previously.
The Euro (EUR) led the market higher rebounding above 1.3700 as Egyptian concerns faded quickly and the buyers returned in force. January Inflation Flash came in at 2.4% vs. 2.3% forecast and confirmed a pick up in the key indicator. EUR/USD traded with a low of 1.3570 and a high of 1.3741 before closing at 1.3690. Looking ahead, January German Unemployment Change forecast at -10k vs. 3k previously. Unemployment Rate forecast 7.5%.
The Japanese Yen (JPY) was very stable near the Y82 level caught in a weak USD environment but supported from strong crosses. The two safe haven currencies regular compete to be the weakest in the market. Overall the USDJPY traded with a low of 81.89 and a high of 82.27 before closing the day around 82.05 in the New York session.
The Sterling (GBP) was one of the strongest in the recovery rally yesterday climbing above 1.6000 in a stunning return to strength. GBP/JPY buying was noted with market turning more bullish on the GBP going forward due to inflation risks. Overall the GBP/USD traded with a low of 1.5823 and a high of 1.6052 before closing the day at 1.6015 in the New York session.
The Australian Dollar (AUD) shrugged off the risk aversion caused from the Egyptian uprising to push back towards 1.0000. Commodities have been strong with Oil pushing higher on supply fears and the Broader Commodity basket up 2%. Overall the AUD/USD traded with a low of 0.9864 and a high of 0.9992 before closing the US session at 0.9970. Looking ahead, RBA Rate Decision forecast to remain at 4.75%.
Oil & Gold (XAU) fell back on easing middle east contagion fears and safe haven demand. Overall trading with a low of USD$1323 and high of USD $1346 before ending the New York session at USD$1333 an ounce. Crude Oil surged for a second day with the potential for Egyptian supply disruptions enough to push another $2 barrel higher. WTI Oil Closed +$2.70 at $92.05 a barrel.
|Currency||Sup 2||Sup 1||Spot||Res 1||Res 2|
Euro - 1.3725
Initial support at 1.3541 (Jan 24 low) followed by 1.3499 (Dec 14 low). Initial resistance is now located at 1.3758 (Jan 27 high) followed by 1.3825 (Nov 10 high)
Yen - 82.05
Initial support is located at 81.61(Jan 4 low) followed by 80.93 (Jan 3 low). Initial resistance is now at 82.93 (Jan 28 high) followed by 83.22 (Jan 27 high).
Pound - 1.6055
Initial support at 1.5822 (Jan 31 low) followed by 1.5752 (Jan 25 low). Initial resistance is now at 1.6095 (Nov 19 high) followed by 1.6185 (Nov 12 High).
Australian Dollar - 0.9980
Initial support at 0.9864 (Jan 24 low) followed by the 0.9753 (Dec 8 low). Initial resistance is now at 1.0009 (Jan 20 High) followed by 1.0077 (Jan 19 high).
Gold - 1335
Initial support at 1308 (Jan 28 low) followed by 1283 (Sep 28 low). Initial resistance is now at 1353 (Jan 24 high) followed by 1371 (Jan 20 high).
Oil - 92.05
Initial support at 91.50 (Intraday Support) followed by 90.00 (Intraday Support). Initial resistance is now at 92.50 (Intraday Resistance) followed by 94.00 (Intraday Resistance).
Written by Anthony Darvall