Australian FOREX Daily Outlook 09/05/2007

Aussie Retail Sales surprise giving support to the AUD. FOMC the first central bank to make an announcement this week, ahead of BoE and ECB  

                                                                                                                                                                                                                                     

CURRENCY TRADING SUMMARY –  09 MAY 07 (23:30GMT)
                                                                     

  • U.S. Dollar Trading (USD) was mixed on Tuesday due to technical trading ahead of the FOMC meeting which may hint at a rate cut, with many economists confident that the benchmark for federal funds rate will reach 5% by year end. In U.S. share markets the NASDAQ rose by 0.8 points (+0.03) and the Dow Jones fell by -3.9 points (-0.02%). Crude oil rose by US$0.78 a barrel to US$62.25, as forecasts of hitting the U.S. Looking ahead the much anticipated FOMC rate announcement will be released today, with market sentiment confident that the rate will remain unchanged. It will be accompanying statements that cause most interest as to whether there is a slight indication of a rate cut some time this year.  

                                                                                                                                                                                                                                         

  • The Euro (EUR) slid against the USD on Tuesday with investors squaring profits following recent record highs, triggering some sell orders to further push the Euro down towards 1.3515 (three-week low). Overall the EUR traded with a range of a low 1.3515 and a high of 1.3622 before closing the day at 1.3542 in the New York session.    

 

  • The Japanese Yen (JPY) gained almost 0.2% versus the USD, and 0.65% against the Euro. Analysts said part of the JPY rise was tied to speculative positioning and risk reduction. Overall, the JPY traded with a range of a low 119.52 and a high of 120.14 before closing the day at 119.94 in the New York session.  

 

  • The Sterling (GBP) remained relatively unchanged from previous session, ahead of the BoE interest rate announcement on Thursday, where it is expected to hike to 5.5%, the highest of all G7 nations. Overall the GBP traded with a range of a low 1.9881 and a high of 1.9962 before closing the day at 1.9888 in the New York session.        

 

  • The Australian Dollar (AUD) rallied above 0.8300 levels in the Asian session of trading on the back of positive Retail Sales data showing a rise of 1.1% when consensus was significantly lower at 0.5%, before gains were paired off during the New York session. Overall the AUD traded with a range of a low 0.8244 and a high of 0.8309 before closing the day at 0.8282 in the New York session.

 

  • The Turkish Lira (TRY) weakened marginally on Tuesday to 1.3400 against the dollar, bouncing off an earlier high of 1.3325 on the inter-bank market. Data from Turkish statistics institute on Tuesday showed industrial output grew a slower-than-expected 2.6% for the month of March.

 

  • Gold (XAU) eased despite trading in a narrow range for much of the session. Gold fell by US$3.00 an ounce to US$687.40   

 

TECHNICAL COMMENTARY                                                     

                                                                                                                                         

                                                                                                                                         

                                                                                                                     

                     

Currency Sup 2 Sup 1 Spot Res 1 Res 2
EUR/USD 1.3371 1.3490 1.3540 1.3629 1.3683
USD/JPY 119.06 119.50 119.85 120.15 120.54
GBP/USD 1.9823 1.9843 1.9890 2.0002 2.0076
AUD/USD 0.8204 0.8241 0.8275 0.8313 0.8343
XAU/USD 667.80 680.40 685.10 691.91 693.80

                     

 

  • Euro 1.3540

Initial support at 1.3490 (23.6% retracement of the 1.2865 to 1.3683 advance) followed by 1.3371 (38.2% retracement of the 1.2865 to 1.3683 advance). Initial resistance is now located at 1.3629 (May 7 high) followed by 1.3683 (Apr 27 trend high)

                                                                               

  • Yen 119.85

Initial support is located at 119.50 (May 2 low) followed by 119.06 (May 1 low). Initial resistance is now at 120.15 (May 8 high) followed by 120.54 (76.4% retracement of the 122.20 to 115.15 decline)

 

  • Pound – 1.9890

Initial support at 1.9843 (May 4 low) followed by 1.9823 (Former resistance from Apr 3) Initial resistance is now at 2.0002 (May 5 high) followed by 2.0076 (May 1 high)

 

  • Australian Dollar – 0.8275

Initial support a 0.8241 (May 8 low) followed by 0.8204 (May 7 low). Initial resistance is now at 0.8313 (May 8 high) followed by 0.8343 (76.4% retracement of the 0.8334 to 0.8170 decline)

 

  • Gold – 685.10

Initial support at 680.40 (May 4 low) followed by 667.80 (May 2 low). Initial resistance is now at 691.91 (May 7 high) followed by 693.80 (Apr 23 high)

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