Forex Market
Asian Currencies Technicals
AUD/USD: Remains heavy, key support below. The double daily bottom didn’t last long with the break lower pausing ahead of initial support in the $1.0436-54 region.
Positive US data – good or bad for the USD?
What to do with the US dollar on positive US data? It’s tough to argue that the USD should sell-off if this means a delay to QE3. Is this market so hung up on the central bank liquidity that good is bad for risk?
FX Daily Crosses
Today’s highlights: * EURGBP: We allow for the squeeze higher to extend, but look for .7950/64 to cap to see a test of the .7755/40 support. * EURJPY: Removal of recovery trend support at 96.10 would see bearish forces mount for 94.92 ahead of 94.11.
FX Daily Strategist: US
* EUR recovery withstands soft euro zone GDP release We retain our that the path of least resistance continues to be the EUR/G4 crosses (EURUSD, EURUSD and EURJPY) being much more vulnerable to upside surprises on a 4-6 week view, as opposed to downward surprises.
GBP Analysis
Opened early Europe at $1.5695, stg0.7872, GBP closed in NY at $1.5684 after pulling back from a late Europe high of $1.5717. Rate pressed on support at $1.5680 into early Asia, eventually breaking below, as it tracked early EUR/USD slippage (prompted by Tokyo EUR/JPY sales), trading to a low of $1.5675.
FX Daily Majors
Today’s highlights: * EURUSD: Recovering back up towards 1.2388 interim chart resistance. We expect the market to break through here to challenge 1.2444/79 and then 1.2598.
EUR Analysis
Opened early Europe at $1.2355, EUR/USD closed in NY at $1.2332 after settling back following its rally extension to $1.2374. Rate crept up to $1.2337 in early Asia before Tokyo sales of EUR/JPY squeezed it down to $1.2325, retesting NY lows.
JPY Analysis
Opened in early Europe at Y78.44 and Y96.95, opened in Asia at Y78.31 and headed higher to Y78.45 on a positive start for equities as volumes continued light due to the O-Bon holidays.
FX Daily Strategist: Europe
* EUR recovery to be tested by eurozone GDP release EUR has continued to hold up well despite a barrage of negative political headlines, such as German press reports suggesting the German constitutional court ruling (Sep 12) on ESM and fiscal union could be further delayed.
AUDUSD set for test lower?
A critical area for AUDUSD today as the 1.0500 support level may be challenged. Momentum indicators are suggesting potential weakness as well.
Dbdaily: European Edition
HEADLINES… * Markets: EU/US equities modestly in the red on weekend comments from ECB’s Coene and as newswires report a possible challenge to the German Constitutional Court’s ESM ruling, CHN bourses also a little softer early Tuesday but most of Asia in the black.
European FX Daily
* Kiwi retail sales stronger than expected * Indian central bank reiterates hawkishness * Euro area GDP likely contracted in Q2 * Greece to sell EUR3.1bn of 91-day bills