Analyst Paul Ebeling of www.livetradingnews.com takes a look at EUR/USD, GBP/USD, USD/CHF, EUR/CHF, USD/JPY, USD/CAD, AUD/USD
10-Yr: Unch..1.594%.. USD/JPY: 80.15.. EUR/USD: 1.2749
The US Dollar Index was slammed to session lows near 80.90 following the release of the FOMC Minutes. The Minutes backed yesterday’s speech by Fed Vice Chair Janet Yellen in which she suggested the Fed may eliminate their timeframe for low rates, and instead use data targets. Recent action has seen the Dollar Index rally back above the 81.00 mark.
EUR/USD is +55 pips at 1.2755 as traders move into the single currency despite today’s flight into safety. The euro is curiously outperforming with some pointing to positive comments by Olli Rehn regarding Spain’s debt burden as reasons for the strength. Today’s bid comes amid strikes across the Eurozone as workers push back against government plans for austerity. The 200-Day MA aids resistance near 1.2780. Eurozone data is heavy as numerous GDP readings accompany Eurozone CPI and the ECB Monthly Bulletin.
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GBP/USD is -15 pips at 1.5855 as trade tests the critical area aided by both the 100 and 200-Day MAs. Today’s weakness comes after the latest Bank of England Inflation Report showed the central bank lowered its 2013 growth forecast to 1.0% and suggested it would not see inflation ease to 2.0% until mid-2013 early 2013 prior.
Stagflation remains a concern of the central bank as slow growth and high inflation remain problematic. Britain’s retail sales are due out Thursday.
USD/CHF is -30 pips at .9440, and is now on track for its lowest close in a week. Traders are eyeing the .9400 support area that should see some help from the 200-Day MA.
EUR/CHF is looking to regain its 200-Day MA after Wednesday’s weakness dropped the pair below the mark for the first time since the beginning of September.
USD/JPY is +80 pips at 80.15 with today’s bid coming on talk of more easing from the Bank of Japan. Overnight, Japanese Prime Minister Yoshihiko Noda called for snap elections to be held on 16 December. One of the potential successors is Liberal Domestic party member Shinzo Abe who has been calling for unlimited printing of Yen and a 3.0% inflation target. The 79.40 mark provides support while 80.50 remains Key resistance.
AUD/USD is -55 pips at 1.0380 as trade slides to its lowest level in more than a week. Traders are focused on the 1.0370 area in the near-term as both the 50 and 100-Day MA hold in the vicinity. A more important area to watch is 1.0325 which is home to the 200-Day MA. On a longer time horizon the 1.0150/1.0600 levels should be watched. Australian data includes MI Inflation Expectations and new motor vehicle sales.
USD/CAD is +10 pips at 1.0030 and is on track for its best close in more than 3 months. Selling was unable to penetrate the 200-Day MA which has held firm in each of the past 4 sessions. This is encouraging for US Dollar Bulls as strength in this pair typically leads moves in the broader based dollar index. Canada’s manufacturing sales will cross the wires Thursday.
Paul A. Ebeling, Jnr.
Paul A. Ebeling, Jnr. writes and publishes The Red Roadmaster’s Technical Report on the US Major Market Indices, a weekly, highly-regarded financial market letter, read by opinion makers, business leaders and organizations around the world.
Paul A. Ebeling, Jnr has studied the global financial and stock markets since 1984, following a successful business career that included investment banking, and market and business analysis. He is a specialist in equities/commodities, and an accomplished chart reader who advises technicians with regard to Major Indices Resistance/Support Levels.
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