Easy Forex Daily Forex Report 15-07-2012

FOREX Daily Outlook by Easy-Forex.com

China GDP slowing but expected

U.S. Dollar Trading (USD) heavy
selling was seen overnight on the back of the worsening EU debt crisis and weak
Australian Jobs data. US stocks have fallen for 7 days now and we are reaching
some extremely oversold levels so are on the lookout for a short squeeze or
relief rally. Chinese GDP may be the catalyst with the world’s largest economy
slowing as expected to 7.6% but not as sharp as some feared with rumors of 7% doing
the rounds in Asia before the release. Looking ahead, July UoM Consumer Confidence
released.

The Euro (EUR) broke through
1.2200 but was able to find support at 1.2160 and we nearly closed the day out
above 1.2200 in the US session. The relief was short-lived however as after the
bell we saw Italy downgraded by 2 notches by Moody in a move that is likely to
be copied by the other rating agencies. The EUR/USD will need some positive
news to stop the down trend with most crosses also very weak and hampering any
buying. The Sterling (GBP) the
GBP/USD broke 1.5450 overnight and closed under the figure but the follow-through
selling was mild and we are sitting just under the key support as we enter
European trade on Friday. Some support is being seen from EUR/GBP selling but
the main driver is stocks which are trending lower lately. The ongoing Libor
banking scandal is also threatening to damage the UK banking sector and not
helping sentiment at all. Looking ahead, no
data tonight.

The Japanese Yen (JPY) USD/JPY calmed
down after its sharp move towards Y80 and subsequent drop to Y79.25 post BOJ
yesterday. The outlook is for more range trading while the US QE debate rages
on and the EUR/JPY sellers are in control. AUD/JPY is also under pressure as
stock losses mount and we could see some sharp selling if Y80 is broken. Australian Dollar (AUD) the
AUD/USD was a big mover overnight falling dramatically against the USD and most
crosses when Unemployment missed for June. The trading so far in Asia has seen
some buying come through though with stocks recovering into the weekend and
Chinese GDP not as bad as feared.

Oil & Gold (XAU) Gold was pressured
lower with the USD strength beating safe haven demand from weak European bonds.
Support is seen at $1564 and $1550. OIL/USD was strong bucking
other assets to rally to $86 a barrel.

Pairs to watch

EUR/USD the Italian downgrade to continue the
downside pressure?

AUD/JPY will stock losses push this pair to Y80?

TECHNICAL COMMENTARY

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