U.S. Dollar Trading (USD) stocks pulled back during the European and US Sessions as profit taking kicked in after Friday’s large rally. A weaker than forecast July Consumer Credit number at -3bn vs. +9bn forecast added to the downside weight. Further pullbacks could be seen if any of the risk events out of Europe emerge to the downside. Looking ahead, July Trade Balance forecast at -44.2bn vs. -42.9bn previously.
The Euro (EUR) some negative headlines out of Germany regarding fresh court challenges to the new ECB bond plan and jitters over a court decision due tomorrow regarding the ESM. Traders have been waiting weeks for tomorrow’s ESM decision from the German Constitutional Court with a negative outcome severely impacting the crisis. Also of note is the EU/IMF Troika inspection currently underway in Greece. Any negative comments regarding Greece’s commitment to Austerity could prompt more speculation of them leaving the Eurozone. The Sterling (GBP) reversed back below 1.6000 as the lofty figure proved too much for the Pound given so many risk events on the horizon. The trend is still higher however so support is expected to be found shortly at either 1.5960 or 1.5920. GBP/JPY is struggling since Friday’s NFP and is hurting the outlook for the major. Looking ahead, July UK Trade Balance forecast at -8.9bn vs. -10.1bn previously.
The Japanese Yen (JPY) USD/JPY was very quiet in a small Y778.20-30 range. We saw more weakness on the Yen crosses with EUR/JPY back below Y100 and AUD/JPY back below Y80. The USD/JPY is expected to react to the FOMC decision later this week so traders may sit on the sidelines until the announcement. Australian Dollar (AUD) weak August China Trade Balance data showing a sharp drop in imports hurt sentiment towards the Aussie and prompted a pullback to 1.0330 by the end of the US session. The German court rulings and stock market movements will direct the AUD/USD over the coming sessions. Looking ahead, August AUD Business Confidence previously at 4.
Oil & Gold (XAU) XAU/USD eased back $10oz to find support at $1725 as profit taking hit markets broadly. OIL/USD found support on a dip below $96 and closed back above the figure.
German Court to Rule on ESM/Bond Buying
U.S. Dollar Trading (USD) stocks
pulled back during the European and US Sessions as profit taking kicked in after
Friday’s large rally. A weaker than forecast July Consumer Credit number at
-3bn vs. +9bn forecast added to the downside weight. Further pullbacks could be
seen if any of the risk events out of Europe emerge to the downside. Looking ahead, July
Trade Balance forecast at -44.2bn vs. -42.9bn previously.
The Euro (EUR) some negative
headlines out of Germany regarding fresh court challenges to the new ECB bond
plan and jitters over a court decision due tomorrow regarding the ESM. Traders
have been waiting weeks for tomorrow’s ESM decision from the German Constitutional
Court with a negative outcome severely impacting the crisis. Also of note is
the EU/IMF Troika inspection currently underway in Greece. Any negative
comments regarding Greece’s commitment to Austerity could prompt more
speculation of them leaving the Eurozone. The Sterling (GBP) reversed
back below 1.6000 as the lofty figure proved too much for the Pound given so
many risk events on the horizon. The trend is still higher however so support
is expected to be found shortly at either 1.5960 or 1.5920. GBP/JPY is
struggling since Friday’s NFP and is hurting the outlook for the major. Looking ahead, July UK
Trade Balance forecast at -8.9bn vs. -10.1bn previously.
The Japanese Yen (JPY) USD/JPY was very
quiet in a small Y778.20-30 range. We saw more weakness on the Yen crosses with
EUR/JPY back below Y100 and AUD/JPY back below Y80. The USD/JPY is
expected to react to the FOMC decision later this week so traders may sit on
the sidelines until the announcement. Australian Dollar (AUD) weak
August China Trade Balance data showing a sharp drop in imports hurt sentiment
towards the Aussie and prompted a pullback to 1.0330 by the end of the US
session. The German court rulings and stock market movements will direct the AUD/USD
over the coming sessions. Looking ahead, August AUD Business Confidence previously at 4.
Oil & Gold (XAU) XAU/USD eased back
$10oz to find support at $1725 as profit taking hit markets broadly. OIL/USD found support on a
dip below $96 and closed back above the figure.
Pairs to watch
EUR/USD German Court Rulings the next risk event?
AUD/USD the downtrend to return this week?
TECHNICAL COMMENTARY
Currency
Sup 2
Sup 1
Spot
Res 1
Res 2
EUR/USD
1.2665
1.2700
1.2765
1.2830
1.2840
USD/JPY
77.90
78.00
78.20
78.67
79.14
GBP/USD
1.5923
1.5980
1.5995
1.6143
1.239
AUD/USD
1.0276
1.0320
1.0330
1.0425
1.0443
XAU/USD
1690.00
1720
1729
1750
1765
OIL/USD
94.50
95.00
96.20
97.00
98.00
By Anthony Darvall (TonyD)
Forex trading involves substantial risk of loss, and may not be suitable for everyone.
Click here to visit Easy-Forex.com
Related Posts: