US Unemployment Data Looming
CURRENCY TRADING SUMMARY – 6th November (00:30GMT)
U.S. Dollar Trading (USD) with stocks rallying for a 4th day the market went back into 'risk on' mode and the USD was on the back foot. Weekly Jobless claims were 512k vs. 530k previously. Q3 Productivity at 9.5% was very strong vs. 6.5% forecast. In US Stocks, DJIA +203 points closing at 10005, S&P +20 points closing at 1066 and NASDAQ +49 points closing at 2105. Looking ahead, October Non Farm Payrolls forecast at -175k vs. -263k previously. The October Unemployment rate is forecast at 9.9% vs. 9.8% previously.
The Euro (EUR) continued to find strength on dips as US stocks soared and the ECB was relatively upbeat at their ECB meeting were they held rates at 1.0%. The pair failed to track the gains completely on Wall st. as the market pauses ahead of the US Unemployment data tonight. Overall the EUR/USD traded with a low of 1.4810 and a high of 1.4920 before closing at 1.4880. looking ahead, September Industrial Orders are forecast at 1% vs. 1.45 previously.
The Japanese Yen (JPY) was strong is Asia as the Nikkei fell but then was sold for most of the day as the US had its biggest rally in 2 months. AUD/JPY and GBP/JPY led the rebound but the market was well contained again as the event risk of the NFP today contained risk appetite. Overall the USDJPY traded with a low of 89.97 and a high of 90.84 before closing the day around 90.75 in the New York session. Looking ahead, September Leading Indicators previously at 0.8%.
The Sterling (GBP) shot higher as the BoE increased the Asset purchase program by 25bn vs. 50bn forecast. The BoE held rates at 0.5%. The market found resistance above 1.6600 and settled below the figure. EUR/GBP support was in the low 0.89's. GBP/JPY reclaimed the 150 Yen level. Overall the GBP/USD traded with a low of 1.6639 and a high of 1.6464 before closing the day at 1.6580 in the New York session. Looking ahead, UK PPI Output prices are forecast at 0.3% vs. 0.5% m/m previously.
The Australian Dollar (AUD) good data could not help the Aussie rally in Asia as AUD/JPY selling dragged the pair to day lows before a change in sentiment pushed the pair higher once again in the US. September Trade Balance at -1.85bn vs. -2.1bn forecast. Overall the AUD/USD traded with a low of 0.9023 and a high of 0.9127 before closing the US session at 0.9105. Looking ahead, RBA Monetary Policy Statement.
Oil & Gold (XAU) consolidated gains settling just under $1100 level. Overall trading with a low of USD$1083 and high of USD$1095 before ending the New York session at USD$1091 an ounce. Fell back below $80 a barrel on profit taking after recent 3 day rally. Crude Oil was down $0.78 ending the New York session at $79.62.
TECHNICAL COMMENTARY
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.4626 |
1.4702 |
1.4875 |
1.4917 |
1.4927 |
|
USD/JPY |
89.20 |
89.99 |
90.85 |
91.32 |
91.62 |
|
GBP/USD |
1.6241 |
1.6402 |
1.6575 |
1.6693 |
1.6742 |
|
AUD/USD |
0.8907 |
0.8971 |
0.9110 |
0.9144 |
0.9218 |
|
XAU/USD |
1055.00 |
1080 |
1091.00 |
1097.00 |
1100.00 |
|
OIL/USD |
78.00 |
78.50 |
79.80 |
81.00 |
82.00 |
Euro – 1.4875
Initial support at 1.4702 (Nov 4 low) followed by 1.4626 (Nov 3 low). Initial resistance is now located at 1.4917 (Nov 5 high) followed by 1.4927 (Oct 27 high)
Yen – 90.85
Initial support is located at 89.99 (Nov 5 low) followed by 89.20 (Nov 2 low). Initial resistance is now at 91.32 (Nov 4 high) followed by 91.62 (Oct 29 high).
Pound – 1.6575
Initial support at 1.6402 (Nov 4 low) followed by 1.6241 (Oct 19 low). Initial resistance is now at 1.6693 (Oct 23 high) followed by 1.6742 (Sept 11 high).
Australian Dollar – 0.9110
Initial support at 0.8971 (Nov 4 low) followed by the 0.8907 (Nov 2 low). Initial resistance is now at 0.9144 (Nov 4 high) followed by 0.9218 (Oct 27 high).
Gold – 1091
Initial support at 1080 (Nov 4 low) followed by 1055 (Nov 3 high). Initial resistance is now at 1097 (Nov 4 high ) followed by 1100 (Psychological level).
Oil – 79.80
Initial support at 78.5 (Intraday Support) followed by 78.0 (Intraday support). Initial resistance is now at 81 (Nov 5 high) followed by 82 (October High).
USD Searching for Support
Last week’s currency trading review
The Dollar lost ground against the Euro and Aussie but was strong against the Yen as traders pared back USD shorts. The CAD had a correction after the BOC released a dovish outlook at their Interest Rate meeting. Strong Chinese data helped Equity Markets with Q3 GDP at 8.9% q/y. Existing Home sales jumped 8.9% in September. The Euro broke above 1.5000 for the first time this year but failed to follow through as the USD found support. Concern about the strength of the Euro to the European recovery is causing some to question the uptrend. German IFO was at 91.9 in October vs. 91.3 previously. The EUR/USD gained 0.69% closing at 1.5008, after opening the week at 1.4904.
The Japanese Yen continued to weaken across the board as the long term yields on US treasuries made funding more expensive in the USD. Resistance at 91.60 was broken on Friday and EUR/JPY hit 138 for the 3rd time this year. The USD/JPY gained 1.29% at 92.08 after opening the week at 90.89. The GBP crashed on Friday after being bought for most of the week after very weak Q3 GDP numbers of -0.4% vs. 0.2% forecast. The pair had traded above 1.6660 and as low as 0.9000 on the EUR/GBP. Also released during the week was the MPC minutes showing a 9-0 vote for keeping rates at 0.5% and QE at 175Bn. GBP/USD fell 0.28% closing at 1.6309 after opening at 1.6354. The AUD was solid as the market continued to buy on dips and AUD/JPY soared to fresh year highs. 0.9300 seems to cap even though the RBA minutes were quite hawkish. The AUD/USD gained 0.66% at 0.9223 after opening at 0.9162.
The forex trading week preview
In the States; On Wednesday, September Core Durable Goods are forecast at 0.7% vs. 0.0% previously. On Thursday, Q3 GDP is forecast at 3.0% vs. -0.7%. previously. Also released, Weekly Jobless claims forecast at 523k vs. 531k previously. On Friday, UoM Consumer Confidence is forecast at 70 vs. 69.4 previously. We will provide our previews and reviews of these data releases in the daily summary.
In the Eurozone; On Tuesday, EU M3 is forecast at 2.2% vs. 2.5% previously. On Wednesday, German October CPI is forecast at 0.0% vs. -0.3% previously. On Thursday, German Unemployment is forecast at 8.3% vs. 8.2% previously. On Friday, EU Oct CPI is forecast at -0.1% vs. -0.3% y/y previously. In the UK; On Monday, BoE release a report on there Asset Purchase Facility. On Thursday, September Mortgage Approvals are seen at 53.6 vs. 52.3 previously. On Friday, GFK Consumer Confidence is seen at -14 vs. -16 previously. We will provide our previews and reviews of these data releases in the daily summary.
In Japan; on Thursday, Sept Preliminary Industrial Production is forecast at 1.1% vs. 1.6% previously. On Friday, BOJ meet to discuss Interest rates. Also released, National CPI for Sept forecast at -2.2% y/y. In Australia; On Wednesday, Q3 CPI is forecast at 0.9% vs. 0.5% previously. We will provide our previews and reviews of these data releases in the daily summary.
TECHNICAL COMMENTARY
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.4762 |
1.4829 |
1.5010 |
1.5083 |
1.5163 |
|
USD/JPY |
90.08 |
90.78 |
92.10 |
92.53 |
93.30 |
|
GBP/USD |
1.6120 |
1.6241 |
1.6320 |
1.6742 |
1.6831 |
|
AUD/USD |
0.8985 |
0.9113 |
0.9220 |
0.9347 |
0.9476 |
|
XAU/USD |
1043.00 |
1048 |
1053.00 |
1067.00 |
1070.00 |
|
OIL/USD |
78.50 |
79.80 |
79.90 |
82.00 |
82.80 |
Euro – 1.5010
Initial support at 1.4829 (Oct 19 low) followed by 1.4762 (Oct 13 low). Initial resistance is now located at 1.5083 (Oct 21 high) followed by 1.5163 (76.4% retrace 1.6038 - 1.2330)
Yen – 92.10
Initial support is located at 90.78 (Oct 22 low) followed by 90.08 (Oct 20 low). Initial resistance is now at 92.53 (Sept 21 high) followed by 93.3 (Sept 7 high).
Pound – 1.6320
Initial support at 1.6241 (Oct 19 low) followed by 1.6120 (Oct 8 low). Initial resistance is now at 1.6742 (Sept 11 high) followed by 1.6831 (Aug 7 high).
Australian Dollar – 0.9220
Initial support at 0.9113 (Oct 19 low) followed by the 0.8985 (Oct 12 low). Initial resistance is now at 0.9347 (Aug 4 08 high) followed by 0.9476 (Jul 31 08 high).
Gold – 1053
Initial support at 1048 (Oct 21 low) followed by 1043 (Oct 16 low). Initial resistance is now at 1067 (Oct 20 high) followed by 1070 (Oct 14 high).
Oil – 79.90
Initial support at 79.80 (Pivot Point) followed by 78.50 (Intraday support). Initial resistance is now at 82 (Oct 21 high) followed by 82.80 (Fib Projection).
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