Currency Tech

R 2: 1.3825
R 1: 1.3689
CURRENT: 1.3638
S 1: 1.3570
S 2: 1.3510

R 2: 1.6185
R 1: 1.6165
CURRENT: 1.6067
S 1: 1.6028
S 2: 1.6010

R 2: 82.93
R 1: 82.47
CURRENT: 82.42
S 1: 81.64
S 2: 81.13

R 2: 1.0255
R 1: 1.0225
CURRENT: 1.0126
S 1: 1.0080
S 2: 1.0055

Market Brief

Economic data expectations are keeping the risk-appetite still alive as the Dollar and the Yen still remain weak against most currencies on positive data from Germany and the US. The EURUSD remained strong trading at a high of 1.3656, USDJPY traded at 82.51, USDCHF was at a high of 0.9655, AUDUSD remained strong at a high of 1.0152 while the GBPUSD moved lower to trade at a low of 1.6050 on expectations that German exports remained strong and jobless claims due to be released tomorrow will drop adding to signs that markets have been improving.

Asian markets were in the negative after Chinese rate hike as the MSCI Asia Pacific index dropped 0.8%, Nikkei was down 0.2%, Hang Seng down 1.25% and the Shanghai Composite down 0.8% in the first trading session in the Lunar New Year. Investors are still optimistic on the US and German economic data despite rising inflation levels in China and possible scenario of further rate increases and New Zealand struggling with a possible recession in second half of last year.

Today's German exports data would show an increase of 1%, biggest increase since September, imports rose 0.8% and tomorrow's jobless claims data would show a drop to 410,000 down 5,000 from the previous week. The Fed President Bernanke is due to talk today, emphasizing on fiscal tightening which could limit losses in the Dollar amid speculation that the Fed may curb bond purchases or opt not to extend the QE2 when it ends in June even as investors bet that the faster economic growth will lead to higher inflation. Fed member Lacker said yesterday the quickening U.S. recovery means policy makers need to adhere to their commitment to review the program while Fisher said he'll probably vote against any proposal to further expand the central bank's balance sheet.

Yesterday, China raised its interest rates for the third time since mid-October by 25bp to 6.06% ahead of today's report forecast to show inflation increased to the fastest pace in 30 months and the Bank of Korea could be next to increase rates to 3% when it meets on Friday to discuss rates which strengthened the Won to near high levels in more than two-years. The Australian currency moved higher on expectations that 17,500 jobs were added last month, an 11th straight month of gains while unemployment remained unchanged at 5%, lowest since Jan. 2009 while on the other hand, the Kiwi depreciated against all currencies after Finance Minister English said that it is possible that the nation entered into recession last year with the currency moving down to 0.7707 low.

Today's calendar consists of German exports, imports, trade balance, UK trade balance, US oil inventory levels, Bernanke's testimony and Fed's Sack speaking about the QE2.