Currency Tech

R 2: 0.9405
R 1: 0.9325
CURRENT: 0.9150
S 1: 0.9125
S 2: 0.89.60

R 2: 1.0580
R 1: 1.0425
CURRENT 1.0360
S 1: 1.0220
S 2: 1.0205

R 2: 133.65
R 1: 132.40
CURRENT: 129.10
S 1: 128.95
S 2: 128.00

R 2: 12.825
R 1: 12.778
CURRENT: 12.676
S 1: 12.575
S 2: 12.487

Market Brief

Last night’s Q4 CPI reading out of New Zealand came out at a lower than expected -0.2% QoQ, +2.0% YoY (consensus +0.2% MoM, +2.1% YoY); reducing the likelihood that the RBNZ will shift to a more hawkish stance in the imminent future. As a consequence, NZDUSD plunged from 0.7400 levels just prior to the release down through first support at 0.7330, and is now threatening a break of the major support level at 0.7290. The USD has also been spurred higher (DXY +0.50%) by disappointing equity market performances across Asia; with the Hang Seng down -2.1% on the day, and the Shanghai Composite down nearly 3%.

EURUSD has taken out its critical 1.4250 support (touching a low of 1.4168 overnight), after the disappointing ZEW survey yesterday, and comments from European Finance Ministers voicing their concerns over the problems in Greece having a knock-on effect within the Euro-bloc. Monetary Affairs Commissioner Almunia stated that “The fate of one is the fate of all… This situation in Greece is having effects on other countries.” And in a subsequent interview, the IMF Managing Director Strauss-Kahn described the Greece issue as “a serious problem”, but added that he did not believe it would lead to the subsequent break-up of the eurozone.

Today’s data events include UK ILO Unemployment (expected to rise to 8.0% from 7.9% currently), and the release of the BoE Minutes. After yesterday’s shock increase in UK CPI (0.6% MoM, 2.9% YoY), BoE Governor King downplayed the speculated pick-up in CPI for the first half the year by attributing the rise to temporary factors. He also clarified that the MPC would wait for clearer conditions before deciding on the fate of the QE programme. Also due this afternoon will be Canadian CPI (forecast to fall -0.2% MoM), US PPI (expected to remain flat on the month), along with US Housing Starts and Building Permits.