US Jobs Data on Tap Ahead
U.S. Dollar Trading (USD) the sentiment remained positive in the markets overnight but little happened in the market overnight with traders still waiting on final details if the Greece debt deal and the major risk event of the week in the market the January US Non-Farm Payrolls is ahead on Friday. Weekly Jobless Claims came in at 367k vs. 375k previously. In US stocks, DJIA -11 points closing at 12705, S&P +1 points closing at 1325 and NASDAQ +11 points closing at 2859k. Looking ahead, January US Nonfarm Payrolls forecast at 170k vs. 212k previously.
The Euro (EUR) the EUR/USD traded in a relatively tight range between 1.3100 and 1.3175 supported on the back of positive Spanish Bond Auctions. The market is waiting final details on the Greece debt deal expected today for next direction before the US jobs data impacts the major via the USD component. Looking ahead, January PMI Services forecast 50.5 vs. 50.5 previously. Also ahead, December Retail Sales forecast at -1.3% vs. 2.5% previously.
The Japanese Yen (JPY) the USD/JPY went to sleep in a 10 pip range as the market consolidate and the crosses got very little direction from the quiet stocks markets. The US Jobs data has the potential to move the pair as the critical piece of data will highlight the health of the US economic recovery. Support is seen under Y76 and intervention was done at Y75.30 last year by the BOJ.
The Sterling (GBP) the GBP/USD was also in consolidation mode stick to a 50 pip range supported at the 1.5850 level as well and will be looking to fresh inspiration from the Greece and the US data tonight. The EUR/GBP is pivoting the 0.8300 level and is an important cross to gauge the relative strength of the Pound. Looking ahead, January PMI services forecast at 53.5 vs. 54 previously.
Australian Dollar (AUD) the AUD/USD followed the same theme trading in a 50 pip range above the 1.0700 level and the consolidating the rally. Further stock market gains tonight on the back of strong US jobs numbers would be needed to move the Aussie to the next level.
Oil & Gold (XAU) Gold extended the rally to $1760 and consolidated just under the level. Oil is under heavy pressure after breaking the $98.50 bottom of the recent range and extended falls to $96 overnight.
Pairs to watch
OIL/USD breaking down technically
EUR/CHF SNB has to act soon to protect 1.2000 target
TECHNICAL COMMENTARY
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.2931 |
1.3000 |
1.3145 |
1.3244 |
1.3386 |
|
USD/JPY |
75.35 |
76.00 |
76.20 |
77.49 |
77.82 |
|
GBP/USD |
1.5517 |
1.5642 |
1.5825 |
1.5889 |
1.5932 |
|
AUD/USD |
1.0428 |
1.0573 |
1.0695 |
1.0753 |
1.1007 |
|
XAU/USD |
1700.00 |
1726 |
1757 |
1763 |
1790 |
|
OIL/USD |
92.50
|
95.00 |
96.50 |
97.00 |
98.50 |
Euro – 1.3145
Initial support at 1.3000 (Big Figure Support) followed by 1.2931 (Jan25 low). Initial resistance is now located at 1.3244 (38.2% retrace of 1.4247-1.2624) followed by 1.3386 (Dec 12 high)
Yen – 76.20
Initial support is located at 76.00 (big figure) followed by 75.35 (Big Figure). Initial resistance is now at 77.49 (Jan 27) followed by 77.82 (Jan 26 high).
Pound – 1.5825
Initial support at 1.5642 (Jan 27 low) followed by 1.5517 (Jan 23 low). Initial resistance is now at 1.5889 (Nov 18 high) followed by 1.5932 (Nov 15 high).
Australian Dollar – 1.0695
Initial support at 1.0573 (Jan 23 high) followed by the 1.0428 (Jan 4 low). Initial resistance is now at 1.0765 (Sept 1 high) followed by 1.1007 (Aug 2 high).
Gold – 1757
Initial support at 1700 (Big figure resistance) followed by 1681 (Jan 23 high). Initial resistance is now at 1763 (Dec 2 high) followed by 1790 (former trendline support drawn off Oct 20 low).
Oil – 96.50
Initial support at 97.00 (Intraday Support) followed by 95.00 (Intraday Support). Initial resistance is now at 98.50 (Intraday resistance) followed by 100.00 (Intraday Resistance).
Written by Anthony Darvall
French Downgrade Sparks Euro Sell off
Last week’s currency trading review
The Dollar was strong on the back of fresh Eurozone concerns with any attempts to rally being sold into and more bad news emerging daily. On Friday night S&P downgraded multiple European countries including France which lost its AAA rating. Data wise we saw a few negative misses which hampered the US stocks attempt to rally even as the debt crisis rolled on. Weekly jobless claims spiked to 399k vs. 375k previously. Consumer Sentiment improved though to 74 vs. 69.9 previously. The Euro was the main mover in the FX market with the S&P downgrades and Greece bailout jitters causing a broad sell off. EUR/AUD fell to all-time lows under 1.2300 and EUR/JPY fell to fresh 12 year lows at Y97. The outlook is still negative and only oversold technical helping to support. The EUR/USD is down -0.33% currently at 1.2676, after opening the week at 1.2712.
The Japanese Yen remained strong in the risk off market led by the EUR/JPY selling. AUD/JPY is the only exception with the strong support seen for the commodities and stocks helping to reverse most dips and the pair closed above Y79. USD/JPY is in a tight range and waiting for either US data to rally or EUR/JPY selling to push the major lower. The USD/JPY is down -0.03% currently at 76.94, after opening at 76.96. The GBP tracked the Euro broadly but was able to finish on a strong note on Friday as the EUR/GBP reversed to 0.8250 supports. The BOE held at 0.5% and kept the asset purchase program at 275b. The GBP/USD is down -0.69% currently at 1.5319 after opening at 1.5425. The AUD was able to decouple form the EUR/USD selling to rally on the back of strong stocks and gold. EUR/AUD extended all-time lows pushing down to 1.2250 and is showing no signs of reversing just yet. Traders are getting caught short as the usual correlation with the EUR/USD breaking down and instead trading the view the Aussie is an Asian currency. The AUD/USD is up +0.91% currently at 1.0320 after opening at 1.0226.
The Forex Trading Economic Data Ahead Preview
In the States; ON Tuesday, Bank of Canada Rate decision forecast to hold at 1.00%. On Wednesday, December Industrial Production forecast at 0.5% vs. -0.2% previously. On Thursday, December CPI forecast at 3.1% vs. 3.4% y/y previously. Weekly Jobless Claims are 389k vs. 399k previously. On Friday, December Existing Home Sales forecast at 5.2% vs. 4 % previously. We will provide our previews and reviews of these data releases in the daily summary.
In the Eurozone; On Tuesday, January German Survey forecast at -49.8 vs. -53.8 previously. In the UK, On Tuesday, December CPI forecast at 4.2% vs. 4.8% previously y/y. On Wednesday December Weekly Jobless Claims are forecast at 8k vs. 3k previously. We will provide our previews and reviews of these data releases in the daily summary.
In Japan; On Thursday, November Industrial Production previously at -4.0% y/y. In Australia; On Thursday, NZD Q4 CPI forecast at 0.4% vs. 0.4% previously. Also December Unemployment Rate forecast at 5.3%. December employment change forecast at 10k vs. -6k previously. Un 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 |
1.2588 |
1.2644 |
1.2645 |
1.2879 |
1.3080 |
|
USD/JPY |
76.00 |
76.58 |
76.80 |
77.74 |
78.98 |
|
GBP/USD |
1.5125 |
1.5272 |
1.5315 |
1.5410 |
1.5501 |
|
AUD/USD |
1.0044 |
1.0229 |
1.0280 |
1.0387 |
1.0567 |
|
XAU/USD |
1605.00 |
1630 |
1638 |
1662 |
1677 |
|
OIL/USD |
97.50
|
99.00 |
99.90 |
100.00 |
101.00 |
Euro – 1.2645
Initial support at 1.2644 (Sept 10 2010 low) followed by 1.2588 (Aug 24 2010 low). Initial resistance is now located at 1.2879 (Jan 13 high) followed by 1.3080 (Dec 28 high)
Yen – 76.80
Initial support is located at 76.58 (Nov 18 low) followed by 76.00 (Big Figure). Initial resistance is now at 77.74 (Dec 30 high) followed by 78.98 (Nov 1 high).
Pound – 1.5315
Initial support at 1.5272 (Aug 6 low) followed by 1.5125 (Jul 21 2010 low). Initial resistance is now at 1.5410 (Jan 6 high) followed by 1.5501 (Jan 10 high).
Australian Dollar – 1.0280
Initial support at 1.0229 (Jan 10 low) followed by the 1.0044 (Dec 29 low). Initial resistance is now at 1.0387 (Jan 3 low) followed by 1.0567 (Mar 3 high).
Gold – 1638
Initial support at 1630 (Jan 11 low) followed by 1605 (Jan 9 low). Initial resistance is now at 1662 (50% retrace of 1802.93-1522.65) followed by 1677 (Dec 13 high).
Oil – 99.90
Initial support at 99.00 (Intraday Support) followed by 97.50 (Intraday Support). Initial resistance is now at 100.00 (Intraday resistance) followed by 101.00 (Intraday Resistance).
Written by Anthony Darvall
Portfolio Managers
Forex
Glossary
Charts
Interest
Currency
Financial
