Pulse of the Market
· The U.S Dollar struggled to find strength for a second day of gains
· Euro traded slightly higher and German industrial production tops forecast
· British Pound traded higher and U.K interest rate expectations gather pace
· Yen was stronger and Japanese machine orders tops forecast
The U.S Dollar ended the yesterday’s trading session slightly lower against most of the major currencies. With no major U.S economic reports released yesterday and little news on European Sovereign debt troubles, it has been a quiet day in the financial markets. Changes in commodity prices can also have a big impact on trade activity because import and export balances are sensitive to the price of the goods traded. U.S trade numbers are scheduled for release today and it will be interesting to look for any consistencies in the report. The Single Currency traded slightly higher against the Greenback as investors think over the possibility of European leaders reaching an agreement that would cover the way for a comprehensive rescue package for the region. If Euro Zone leaders failed to come up with a package this month, Portugal could be forced towards IMF and EU. German industrial production rose by 1.8 percent in January, confirming the strength which has seen in other manufacturing sector reports. German trade and current account numbers are due for release today and expected healthier numbers all around as manufacturing activity feeds into trade activity. ECB monthly report is also scheduled for release in today’s trading session. Swiss Franc performed extremely well yesterday, rose strongly against the U.S Dollar and Euro. Recent economic data from Switzerland has highlighted the country’s low level of unemployment and muted inflationary pressures. Cable gained strength against the U.S Dollar for the first time in five trading days. BoE has a monetary policy announcement today and interest rates are not expected to be changed. However improving economic data and high oil prices may have convinced other members of the central bank to vote in favor of raising interest rates. Cable was also supported from stronger trade numbers. Aside from the rate decision, U.K industrial production is due for release today and it’s expected to be another round of stronger manufacturing data to support the Cable. Yen traded lower against all of the major currencies yesterday. The latest Japanese economic data showed machine orders growing 4.2 percent in January, stronger than expected.
Time(GMT) | Economic Release | IM | Actual | Forecast | Prior |
00:30 | Australia Employment Change (FEB) | High | -10.1K | 24.0K | |
08:00 | German Trade Balance (Euros) (JAN) | Medium | 13.0B | 11.9B | |
09:00 | ECB Publishes Monthly Report (MAR) | High | |||
09:30 | U.K Industrial Production (MoM) (JAN) | Medium | 0.4% | 0.5% | |
12:00 | Bank Of England Asset Purchase Target (MAR) | High | 200B | 200B | |
12:00 | Bank of England Rate Decision (MAR) | High | 0.50% | 0.50% | |
13:30 | U.S Trade Balance (JAN) | Medium | -$41.4B | -$40.6B | |
19:00 | U.S Monthly Budget Statement (FEB) | Medium | -$240.5B | 19:00 |
Euro
The Single Currency was stable finding support in the yesterday’s trading session but focus still remains on the smaller European countries debt ahead of the EU summit this weekend. Portugal remains unwavering that they do not need a bailout but the market is continuing to push yields higher. Overall the EUR/USD traded with a low of 1.3855 and a high of 1.3940 before closing the day around 1.3907 in the New York session.
Yen
The Japanese Yen was limited to a 20 pip range yesterday as the market took a break and stocks offered little direction to crosses. Third quarter GDP was unrevised at -0.3% Q/Q. U.S Jobs data will be closely watch for a chance to break above the 83.00 Yen if improvement continues. Overall the USD/JPY traded with a low of 82.56 and a high of 82.92 before closing the day around 82.73 in the New York session.
British Pound
The British Pound was moderately strong in the yesterday’s trading session on improving economic data which proficient to gain across the board. January Trade Balance improved to -7.1 billion vs. -9.7 billion previously and February Shop Prices improved to 2.7% vs. 2.5% previously. Overall the GBP/USD traded with a low of 1.6137 and a high of 1.6241 before closing the day at 1.6199 in the New York session.
Australian Dollar
The Australian Dollar was calm yesterday as stock markets offered little direction with support found just below Tuesday’s low. RBA Stevens spoke in London and was very upbeat taking up the prospects of the commodity economy going forward. Overall the AUD/USD traded with a low of 1.0059 and a high of 1.0131 before closing the day at 1.0106 in the New York session.
Euro-Yen
EURJPY is trading above 14, 50 and 100 days moving average. Fast stochastic is giving a bullish tone and MACD is also issuing a bullish stance. The RSI is above 62 and lies above the neutral zone. Overall the cross has gained 0.11%.
Sterling-Yen
Currently GBPJPY is trading above 14, 50 and 100 days moving average. Fast stochastic is issuing bullish and MACD is indicating a bearish stance. The RSI is above 56 reading and lies above the neutral zone. The pair has gained 0.34%.
Aussie-Yen
Currently, the cross is trading above 14, 50 and 100 days moving average. Fast stochastic gives bearish and MACD is also indicating a bearish stance. The RSI is above 49 reading and lies below the neutral region. The cross has gained 0.17%.
Euro-Sterling
This cross is trading above 14, 50 and 100 days moving average. Fast stochastic is indicating a bearish and MACD is issuing a bullish signal. The RSI is above 56 reading and lies above the neutral region. The pair has lost 0.22%.
Sterling-Swiss
This cross is trading below 14, 50 and 100 days moving average. Fast stochastic is issuing a bullish stance and MACD is indicating a bearish tone. The RSI is above 44 and lies below the neutral region. The pair has lost 0.35%.
Daily Pivot Points | |||||||
Trading Range | |||||||
Contract | S3 | S2 | S1 | Pivot | R1 | R2 | R3 |
EUR/USD | 1.3776 | 1.3816 | 1.3861 | 1.3901 | 1.3946 | 1.3986 | 1.4031 |
USD/JPY | 82.19 | 82.38 | 82.55 | 82.74 | 82.91 | 83.10 | 83.27 |
GBP/USD | 1.6040 | 1.6088 | 1.6144 | 1.6192 | 1.6248 | 1.6296 | 1.6352 |
USD/CHF | 0.9151 | 0.9209 | 0.9252 | 0.9310 | 0.9353 | 0.9411 | 0.9454 |
USD/CAD | 0.9613 | 0.9639 | 0.9661 | 0.9687 | 0.9709 | 0.9735 | 0.9757 |
EUR/JPY | 114.27 | 114.50 | 114.78 | 115.01 | 115.29 | 115.52 | 115.80 |
GBP/JPY | 132.92 | 133.23 | 133.63 | 133.94 | 134.34 | 134.65 | 135.05 |
CHF/JPY | 87.67 | 88.01 | 88.49 | 88.83 | 89.31 | 89.65 | 90.13 |
AUD/JPY | 83.02 | 83.18 | 83.39 | 83.55 | 83.76 | 83.92 | 84.13 |
EUR/GBP | 0.8523 | 0.8544 | 0.8563 | 0.8584 | 0.8603 | 0.8624 | 0.8643 |
EUR/CHF | 1.2756 | 1.2825 | 1.2876 | 1.2945 | 1.2996 | 1.3065 | 1.3116 |
GBP/CHF | 1.4854 | 1.4929 | 1.4993 | 1.5068 | 1.5132 | 1.5207 | 1.5271 |
Sources: News, Charts & Quotes (Courtesy: Reuters, US Department Of Treasury)
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