Currency Tech

EURUSD R 2: 1.2600 R 1: 1.2450 CURRENT: 1.2310 S 1: 1.2175 S 2: 1.2000

USDJPY R 2: 95.00 R 1: 93.70 CURRENT: 91.50 S 1: 90.00 S 2: 88.00

GBPUSD R 2: 1.5050 R 1: 1.4900 CURRENT: 1.4810 S 1: 1.4725 S 2: 1.4550

AUDUSD R 2: 0.8880 R 1: 0.8700 CURRENT: 0.8640 S 1: 0.8550 S 2: 0.8350

Market Brief

The EURJPY traded at 112.66 after it rose to 113.05, the strongest since June 4 while USDJPY rose to 91.52 as signs the global economy is gathering momentum pared demand for JPY as a refuge. The JPY fell versus higher-yielding currencies before a report today that may show US industrial production probably increased 0.9% (prev. 0.8%), the most since January and after Japan's tertiary index added 2.1% (exp. 2.5%), snapping a two-month decline showing demand for services rebounded. The US Empire manufacturing gauge advanced for an 11th month to 19.57 (prev. 19.11) and the VIX dropped to as low as 25.68 yesterday, the least since May 13. USDCAD declined 0.7% to 1.0266 as crude oil rose to its highest in more than a month and traders speculated the RBC will raise rates faster than other countries and Canada is poised to become the first G7 economy to reach pre-recession levels of output.A report tomorrow will show Singapore's non-oil domestic exports gained for a seventh month in May while Taiwan's export orders probably climbed 38% (prev. 35%) according to data due June 21. Malaysia's ringgit traded near a two-week high on speculation data from around the region will show Asian economies are improving, boosting the outlook for its exports with the USDMYR trading at 3.2580 after it reached 3.2470, the weakest level since May 31 and USDKRW lost 1.3% to 1,213.05.

The AUDUSD traded at 0.8649 after it rose as high as 0.8667 on Monday, the strongest level since May 18 while AUDJPY traded at 79.21 and NZDUSD traded at 0.6982 and touched a near one-month high of 0.7021 on Monday while NZDJPY traded at 63.97 near the strongest levels since mid-May after a global rally in stocks and declining volatility boosted demand for higher-yielding assets. NZD was also bolstered as consumer confidence rebounded in the second quarter following a decline in the unemployment rate. Both currencies were bolstered as the S&P 500 Index yesterday rose 2.4% to 1,115.23, exceeding its 200-day MA and MSCI Asia Pacific Index climbed 0.9%, signaling it may extend gains, which is supportive for risk continuing higher and the bias for the AUD and NZD to the upside. The AUDUSD advanced for a sixth day yesterday as Russia said it may add the AUD and CAD to its reserves for the first time after fluctuations in the USD and EUR. Russia's reserves, which reached $458.2 billion on May 14, are made up of 47% USD, 41% EUR, 10% GBP and 2% JPY. The AUDUSD may gain toward 0.8700 and NZDUSD may reach 0.7100 this week, according to estimates.

The EURUSD appreciated 1% to 1.2339 after it touched 1.2350, the highest level since June 1 as gains in global stock markets spurred demand for riskier assets and prompted traders to end bets that the currency would decline. The EURUSD erased an earlier drop as the S&P 500 Index rose to the highest level in almost a month. The EURUSD may appreciate to 1.2475, the highest level in three weeks, as traders close out short positions.