Forex Market Update
This morning, the greenback is trading mostly higher against most of the major currencies, ahead of the Fed Chief, Janet Yellen’s testimony before the Joint Economic Committee.
The JPY is trading higher against its US counterpart, as a broad decline in the Asian equity markets bolstered the currency’s safe-haven appeal. Earlier today, minutes from the BoJ’s recent meeting showed that policymakers expected the Japanese economy to persist with its moderate pace of recovery in the future while noting that sales-tax hike in April had no detrimental effect on consumer spending.
The NZD lost ground against the USD after the RBNZ Governor, Graeme Wheeler hinted that the central bank could intervene in the currency market to sell Kiwi if the currency remained at high levels in the face of falling commodity prices.
Yesterday, in the New York session, the USD traded mostly higher against the key currencies, reversing its initial losses which were triggered by a soft US trade balance data. Later, Fed Governor, Jeremy Stein cautioned that the central bank may be subjected to some spells of volatility as its stimulus package drew to a close.
Late Tuesday, the OECD in its semi-annual outlook report, urged the ECB to undertake additional stimulus measures and slash its record-low 0.25% interest rate further to spur growth and to put an end to prolonged period of low-inflation in the Euro-zone economy.
EUR USD
This morning at 9:40 GMT, the EUR is trading at 1.3921 against the USD, marginally lower from the New York close. Earlier today, data from the Euro-zone’s member nations showed that German factory orders unexpectedly fell in March while industrial production and trade balance data from France failed to match market expectations. During the session, the pair traded at a high of 1.3936 and a low of 1.3915. Yesterday, the EUR traded 0.11% lower against the USD in the New York session, and closed at 1.3927, giving back its initial gains on the back of upbeat Euro-zone economic releases.
The pair is expected to find its first support at 1.3904 and first resistance at 1.3945.
GBP USD
At 9:40 GMT, the GBP is trading at 1.6971 against the USD, a tad lower from the New York close. Data released overnight showed that the BRC shop prices in the UK fell for the 12th consecutive month in April. During the session, the pair traded at a high of 1.6988 and a low of 1.6971. Yesterday, the British Pound traded 0.08% lower versus the Dollar in the New York session, and closed at 1.6974.
The pair is expected to find its first support at 1.6945 and first resistance at 1.6997.
USD JPY
The USD is trading at 101.57 against the JPY at 9:40 GMT this morning, 0.14% lower from the New York close, as a decline in the Asian equity markets spurred demand for the safe-haven yen. Overnight, minutes from the BoJ’s April policy meeting projected recovery in the Japanese economy to continue at a moderate pace as consumer spending in the nation remained buoyant despite the recent sale-tax hike. During the session, the pair traded at a high of 101.78 and a low of 101.47. In the New York session yesterday, the USD traded 0.10% higher against the JPY, and closed at 101.71.
The pair is expected to find its first support at 101.33 and first resistance at 101.90.
USD CHF
This morning at 9:40 GMT, the USD is trading at 0.8750 against the Swiss Franc, 0.08% higher from the New York close. On the economic front, unemployment rate in Switzerland fell to a non-seasonally adjusted rate of 3.2% in April from previous month’s level of 3.3%, while the Swiss economy held CHF438.9 billion in foreign currency reserves at the end of April. During the session, the pair traded at a high of 0.8756 and a low of 0.8738. In the New York session yesterday, the USD traded 0.19% higher against the CHF, and closed at 0.8743.
The pair is expected to find its first support at 0.8728 and first resistance at 0.8764.
USD CAD
At 9:40 GMT, the USD is trading at 1.0885 against the CAD, marginally lower from the New York close, ahead of Canada’s building permits data for March. During the session, the pair traded at a high of 1.0898 and a low of 1.0878. Yesterday, the USD traded 0.19% lower against the CAD in the New York session, and closed at 1.0890. In economic news, the Ivey PMI for the Canadian economy eased modestly in April while Canada’s merchandised trade surplus narrowed more-than-expected in the month of March.
The pair is expected to find its first support at 1.0855 and first resistance at 1.0931.
AUD USD
The AUD is trading at 0.9337 against the USD, at 9:40 GMT this morning, 0.11% lower from the New York close. Early morning, the AiG performance of construction index in Australia remained in the contraction territory for the fourth-consecutive month in April while retail sales in Australia edged up less than market expectations for March. During the session, the pair traded at a high of 0.9357 and a low of 0.9336. AUD traded 0.06% lower against the USD in the New York session, and closed at 0.9347.
The pair is expected to find its first support at 0.9302 and first resistance at 0.9371.
Gold
At 9:40 GMT, Gold is trading at $1311.00 per ounce, 0.20% higher from the New York close, amid lingering tensions over Ukraine crisis. This morning, Gold traded at a high of $1314.70 and a low of $1306.90 per ounce. In the New York session yesterday, the yellow metal traded a tad higher, and closed at $1308.40, giving back its earlier losses which were triggered by strong Euro-zone economic data and thin trading in Asia.
Gold has its first support at $1305.37 and first resistance at $1315.67.
Silver
Silver is trading at $19.70 per ounce, 0.43% higher from the New York close, at 9:40 GMT this morning. This morning, Silver traded at a high of $19.77 and a low of $19.59. Silver traded 0.28% lower against the USD in the New York session, and closed at $19.61, hurt by a stronger US Dollar.
Silver has its first support at $19.57 and first resistance at $19.79.
Crude Oil
At 9:40 GMT, Oil is trading at $100.36 per barrel, 0.50% higher from the New York close, ahead of the EIA’s weekly report of the US crude supplies. This morning, Oil traded at a high of $100.59 and a low of $99.78. Yesterday, Oil traded 0.30% higher in the New York session, and closed at $99.84, after the API reported a surprise 1.8 million barrels drop in the US crude stockpiles, last week. Oil prices also rose after media reports showed that new protest in Libya led to the closure of the Zultun and Raquba oilfields.
It has its first support at $99.60 and first resistance at $100.85.
Economic Snapshot
German factory orders declined unexpectedly in March
On a monthly basis, the seasonally adjusted factory orders in Germany dropped 2.8% in March, compared to a revised 0.9% increase recorded in the previous month. Markets were expecting the seasonally adjusted factory orders to rise 0.3% in March.
France manufacturing and industrial production dropped in March
On a monthly basis, manufacturing production in France dropped 0.7% in March, following an increase of 0.3% recorded in the preceding month. Meanwhile, on a monthly basis, industrial production in France declined unexpectedly by 0.7% in March, compared to a 0.1% increase in the previous month.
France trade deficit widened in March
France posted a trade deficit of €4.94 billion in March, compared to a revised deficit of €3.77 billion recorded in the previous month.
Unemployment rate in Switzerland declined in April
On a non-seasonally adjusted basis, the unemployment rate in Switzerland dropped to 3.2% in April, in line with market expectations and compared to a rate of 3.3% reported in the previous month.
Swiss foreign currency reserves increased in April
Switzerland’s foreign currency reserves rose to CHF 438.95 billion at the end of April 2014, compared to CHF 437.94 billion recorded at the end of March 2014.
Australian foreign exchange reserves declined in April
The foreign exchange reserves in Australia declined to A$ 62.13 billion at the end of April 2014, from A$ 62.21 billion reported at the end of March 2014.
Australia retail sales rose at a slower pace in March
On a seasonally adjusted monthly basis, retail sales in Australia rose 0.1% in March, compared to a revised 0.3% rise recorded in the previous month. Markets were expecting Australian retail sales to rise 0.4% in March.
China Markit services sector activity declined in April
According to Markit Economics, the services Purchasing Managers’ Index (PMI) in China eased to a level of 51.4 in April, from a level of 51.9 reported in the previous month.
Good trades.
