U.S. Dollar Trading (USD)
The mood
in the market started to turn sour in the European session as rumors of Italian
and Spanish bank downgrades weighed. Also hurting was the jump in EU
unemployment rate to the highest in the Unions history. The US session saw
more risk off after the April ADP employment reports showed only +119k vs. 209k
previously and is a worrying sign for Friday’s report. Looking
ahead, Weekly
Jobless Claims are forecast at 380k vs. 388k previously. Also, April ISM
Services forecast at 55.5 vs. 56 previously.
The Euro (EUR) the EUR/USD was sold
going into the European session as Italian PMI shocked to the downside and
rumors of bank downgrades swept through the market. Support at 1.3160 was broken
but the market did not fall far finding support at 1.3130 before
stabilizing and recovering slightly.
The Sterling (GBP)
the GBP/USD fell
below 1.6200 in risk off trade. Weak economic data did not help with April
Construction PMI falling to 55.8 vs. 56.7 previously. GBP/JPY fell below Y130
and is continuing to challenge the bullish outlook for the major. EUR/GBP is
remaining pressured down at 0.8125. Looking ahead, May ECB Rate meeting
forecast at 1.0% vs. 1.0% previously. Also ECB President Draghi
Speaks.
The Japanese Yen (JPY)
Held above Y80 but
was very contained as the crosses came under pressure with EUR/JPY and GBP/JPY
selling leading the way down. The BOJ and Japanese Government officials are
trying to slow the downside with warning of intervention and more easing but the
market is not really affected by such comments. The Nonfarm Payrolls on Friday
is the major risk event for the month for the USD/JPY. Australian Dollar (AUD)
the
AUD/USD tracked stock markets lower yesterday with the risk off trading
pressuring the downside. Support under 1.0300 was quickly found but the bounce
was limited. The RBA rate cut has had little continued effect on the AUD/USD
with the market now looking to stock markets for direction. Looking ahead, no
data from the Asia Pacific.
Oil & Gold
(XAU) XAU/USD dipped
below $1650 briefly overnight as the USD strengthened but we closed back above
the level.
OIL/USD
fell with the rest for the market but found support at $105 and is quite calm
lately.
Pairs to
watch
EUR/USD falling from topside
of 1.33-1.300 range now?
GBP/USD can the Pound ignore
the Euro selling?
TECHNICAL
COMMENTARY
|
Currency
|
Sup 2
|
Sup 1
|
Spot
|
Res 1
|
Res 2
|
|
EUR/USD
|
1.3058
|
1.3105
|
1.3150
|
1.3241
|
1.3284
|
|
USD/JPY
|
79.53
|
79.64
|
80.15
|
80.61
|
81.45
|
|
GBP/USD
|
1.6077
|
1.6154
|
1.6190
|
1.6334
|
1.6400
|
|
AUD/USD
|
1.0247
|
1.0280
|
1.0305
|
1.0380
|
1.0453
|
|
XAU/USD
|
1600.00
|
1630
|
1651
|
1664
|
1683
|
|
OIL/USD
|
103.00
|
104.50
|
105.30
|
106.00
|
107.00
|
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