U.S. Dollar Trading (USD) a quiet end to the week saw the EUR/USD pivot the 1.3000 level with a lack of fresh direction. The European session saw the day highs for stocks and risk appetite but this was unwound in the US session as profit takers took control. Weekend news focused on Spanish bailout plans and Banking stress tests due for release this Thursday. Looking ahead, no data Monday.
The Euro (EUR) talk on Friday that Spain was planning a bailout helped lift the EUR/USD to day highs before a denial from German’s Schaeuble that Spain even needed a bailout. Another reason for the drop in the US session was talk the Swiss national bank was selling Euros from its recent EUR/CHF intervention. The Sterling (GBP) managed fresh year highs above 1.6300 during the European session but reversed sharply in the US session dragged down by weaker stocks and Euro. The outlook is for more gains but there is still some event risk from Spain this week and Greece Troika report. Looking ahead, September IFO German Business Climate forecast at 102.5 vs. 102.3 previously.
The Japanese Yen (JPY) the USD/JPY is finding support at Y78 and is bouncing along waiting for a further catalyst. The weak USD from the QE3 news is pressuring the downside but jawboning from the Japanese Authorities is growing louder and the BOJ itself has loosened monetary policy. The race to have the weakest currency to spur exports is being played by all the large economies including China, Japan and the US. Australian Dollar (AUD) the AUD/USD is struggling to maintain the positive momentum from the previous week and we found ourselves on the back foot for most of last week and we finished offered at 1.0450 after failing at 1.0500. The pro risk rally in US stocks and commodities is helping support the Aussie but the sharp slowdown in China is giving plenty of reasons to sell from these levels.
Oil & Gold (XAU) Gold hit fresh highs above $1785 before reversing sharply on rumors of increased margin requirements from the CME Gold exchange. These have since been dismissed but the precious metal fell $20oz and has opened weak in Asia Monday. OIL/USD finished roughly unchanged as a small rally was reversed back to $92.50 support.
Pairs to watch
EUR/USD Failed at 1.3000, further pullback ahead?
AUD/USD Failed at 1.0500, to test for support now?
Spain Focus as Bank Stress Tests Ahead
U.S. Dollar Trading (USD) a quiet
end to the week saw the EUR/USD pivot the 1.3000 level with a lack of fresh
direction. The European session saw the day highs for stocks and risk appetite
but this was unwound in the US session as profit takers took control. Weekend
news focused on Spanish bailout plans and Banking stress tests due for release
this Thursday. Looking
ahead, no data Monday.
The Euro (EUR) talk on Friday that
Spain was planning a bailout helped lift the EUR/USD to day highs before a
denial from German’s Schaeuble that Spain even needed a bailout. Another reason
for the drop in the US session was talk the Swiss national bank was selling
Euros from its recent EUR/CHF intervention. The Sterling (GBP) managed
fresh year highs above 1.6300 during the European session but reversed sharply
in the US session dragged down by weaker stocks and Euro. The outlook is for
more gains but there is still some event risk from Spain this week and Greece Troika
report. Looking ahead, September
IFO German Business Climate forecast at 102.5 vs. 102.3 previously.
The Japanese Yen (JPY) the USD/JPY is
finding support at Y78 and is bouncing along waiting for a further catalyst.
The weak USD from the QE3 news is pressuring the downside but jawboning from
the Japanese Authorities is growing louder and the BOJ itself has loosened
monetary policy. The race to have the weakest currency to spur exports is being
played by all the large economies including China, Japan and the US. Australian Dollar (AUD) the
AUD/USD is struggling to maintain the positive momentum from the previous week
and we found ourselves on the back foot for most of last week and we finished
offered at 1.0450 after failing at 1.0500. The pro risk rally in US stocks and
commodities is helping support the Aussie but the sharp slowdown in China is
giving plenty of reasons to sell from these levels.
Oil & Gold (XAU) Gold hit fresh
highs above $1785 before reversing sharply on rumors of increased margin
requirements from the CME Gold exchange. These have since been dismissed but
the precious metal fell $20oz and has opened weak in Asia Monday. OIL/USD finished roughly
unchanged as a small rally was reversed back to $92.50 support.
Pairs to watch
EUR/USD Failed at 1.3000, further pullback ahead?
AUD/USD Failed at 1.0500, to test for support now?
TECHNICAL COMMENTARY
Currency
Sup 2
Sup 1
Spot
Res 1
Res 2
EUR/USD
1.2827
1.2920
1.2970
1.3059
1.3173
USD/JPY
77.46
78.00
78.15
78.38
79.00
GBP/USD
1.6065
1.6172
1.6225
1.6304
1.6335
AUD/USD
1.0368
1.0410
1.0430
1.0520
1.0545
XAU/USD
1724.00
1745
1768
1785
1810
OIL/USD
90.00
92.50
92.70
94.00
95.00
By Anthony Darvall (TonyD)
Forex trading involves substantial risk of loss, and may not be suitable for everyone.
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