Australian FOREX Daily Outlook 28/03/2007

 

 

 

CURRENCY TRADING SUMMARY –  28 MARCH 07 (23:30GMT)
                                                                     

  • U.S. Dollar Trading (USD) weakened against other majors with poor Consumer Confidence and ongoing concerns over the slowing of the US housing Markets adding further indication of an interest rate cut in 2007. In US share markets, the NASDAQ was down 18.20 points (-0.74%) whilst the Dow Jones also fell by 71.78 points (-0.57%). Crude Oil continued to rise over growing tension in the Gulf, jumping US$1.24 a barrel to US$64.17. Looking ahead, markets will be focused on Federal Reserve Chairman Bernanke address to the Joint Economic Committee of congress. Of particular interest to investors, will be his view on the sub-prime mortgage markets and the effect to the wider economy. In other news Durable Goods (exc. Transport) will be made public today with markets expecting a figure of 1.6% with the previous being a -3.1%.                           

 

  • The Euro (EUR) jumped 0.1% against the USD during Tuesday day of trading. With a strong German IFO survey coming in at a new record high of 107.7, it did plenty to reinforce future rate hikes by the ECB. Overall, the Euro traded with a low of 1.3323 and a high of 1.3365 before closing the day at 1.3349 in the New York session. Looking ahead, the Eurozone M3 will be made public with markets expecting an unchanged figure of 9.8%.   

 

  • The Japanese Yen (JPY) rose by 0.1% against the Dollar on the back of softer US consumer confidence. Overall, the JPY traded with a range 117.74 and a high of 118.39 before closing at 117.91 in the New York session. Looking ahead, the Japanese Retail Sales for the month of February will be mad public, with markets expecting a figure of 0.1% significantly better than the previous number of -0.9%.    

 

  • The Sterling (GBP) eased from three week highs following comments from BoE officials indicated that the housing sector was starting to slow. BoE Governor King, in testimony to parliamentary committee, said there was no reason to change the banks central forecast that inflation would be around 2% target in two years but risks remained to upside. He also said there were some signs the housing market was beginning to slow. Overall, the GBP traded with a low of 1.9622 and a high of 1.9703 before closing at 1.9661 in the New York session.     

 

  • The Australian Dollar (AUD) was subject to technical trading due to minimal fundamental data out of Australia. As a result the Aussie dollar has found much of its strength on the back of poor figures out of the US. Overall, the AUD traded with a low 0.8068 and a high of 0.8108 before closing at 0.8088 in the New York session.  

 

  • The Polish Zloty (PLN) held steady, with comments from Finance Minister Zyta Gilowska helping bonds fend off early looses ahead of a central bank decision on interest rates. The Minister of Finance indicated that there was no sign of price pressure in the economy and no risk of a bounce in inflation in the next few months, appearing to make the case for keeping rates on hold. Looking ahead, Markets are awaiting the Bank’s statement on monetary policy following the end of their two-day meeting. Overall, the EURPLN traded with a range of a low 3.8622 and a high of 3.8753 

 

  • Gold (XAU) held steady on the back of a softened dollar and firmer oil prices. Gold was up by US$3.20 an ounce to $665.70.

 

 

 

 

TECHNICAL COMMENTARY                                                     

                                                                                                                                         

                                                                                                                     

                     

Currency Sup 2 Sup 1 Spot Res 1 Res 2
EUR/USD 1.3187 1.3252 1.3355 1.3365 1.3412
USD/JPY 116.25 117.16 117.90 118.44 118.50
GBP/USD 1.9431 1.9555 1.9660 1.9728 1.9749
AUD/USD 0.8000 0.8027 0.8075 0.8110 0.8212
XAU/USD 646.20 652.40 664.90 666.70 667.61

                     

 

  • Euro 1.3355

Initial support at 1.3252 (March 26 low) followed by 1.3187 (Former resistance of Mar 7 low). Initial resistance is now located at 1.3365 (March 27 high) followed by 1.3412 (Mar 22)

                                                                               

  • Yen 117.90

Initial support is located at 117.16 (Mar 21 low) followed by 116.25 (Mar 19 low). Initial resistance is now at 118.44 (Mar 26 high) followed by 118.50 (Mar 12 high)

 

  • Pound – 1.9660

Initial support at 1.9555 (Mar 21 reaction low) followed by 1.9431 (Mar 20 low). Initial resistance is now at 1.9728 (Mar 22 high) followed by 1.9749 (Feb 2 reaction high)

 

  • Australian Dollar – 0.8075

Initial support a 0.8027 (March 26 low) followed by 0.8000 (Mar 19 low). Initial resistance is now at 0.8110 (Mar 27 trend high) followed by 0.8212 (Dec 2, 1996 reaction high)

 

  • Gold – 664.90

Initial support at 652.40 (Mar 19 low) followed by 646.20 (Mar 16 low). Initial resistance is now at 666.70 (Mar 22 high) followed by 667.61 (61.8% retracement of the 689.00 to 633.00 decline)

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