Stock Rally halted by AMEX
U.S. Dollar Trading (USD)
U.S. Dollar Trading (USD) weakened as stocks around the world remained very buoyant and US stocks tried to rally for a 5th day. Default concerns from Amex kept this event from eventuating but still most of the majors held on to gains. US Industrial production fell -1.4% vs. -1.2% forecast. NY Fed Manufacturing Index fell to -38 vs. -32 forecast. Crude Oil closed up $1.10 ending the New York session at $47.35 per barrel. In US share markets, the Nasdaq was down -27 points or 1.9% whilst the Dow Jones fell 7 points or 0.10%. Looking ahead, February Industrial Output is forecast at -1.2% vs. -1.8%. Also released, NY Fed Manufacturing forecast at -32 vs. -34.65 previously.
European Euro
The Euro (EUR) tested the critical 1.3000 level but was unable to close above as stocks retreated at the close of New York. Commodities continue to underpin Euros rise and concern about Americas Quantitative Easing plans have hurt the dollars demand. Overall the EUR/USD traded with a low of 1.2869 and a high of 1.3070 before closing the day at 1.2980. Looking ahead, German Zew Economic Sentiment is forecast at -90 vs. -86 previously.
Japanese Yen (JPY)
The Japanese Yen (JPY) held to a tight range against the USD but the crosses all rose testing monthly highs on the AUD/JPY and EUR/JPY. The 100 Yen is a significant level that the market would need a major catalyst to test and remain above. February Tertiary Industry Index at 0.4% vs. -1.6% previously. Overall the USDJPY traded with a low of 97.99 and a high of 98.67 before closing the day around 98.40 in the New York session.
Pound Sterling (GBP)
The Sterling (GBP) traded under 1.4000 briefly on Monday morning after Oil opened $2 lower on OPEC news before a strong rebound in Oil and sentiment dragged cable towards 1.4200. EUR/GBP also pulled back slightly and may be another source of support going forward if it falls back to 0.9000. Overall the GBP/USD traded with a low of 1.3946 and a high of 1.4230 before closing the day at 1.4080 in the New York session.
Australian Dollar (AUD)
The Australian Dollar (AUD) broke above 0.6600, running up to the resistance at 0.6640 before running out of steam. AUD is supported by stronger commodities and is taking full advantage of the recent improvement in investor confidence to build a base at the 0.6300 level. Overall the AUD/USD traded with a low of 0.6548 and a high of 0.6640 before closing the US session at 0.6590. Looking ahead, RBA minutes for the March minutes.
Gold
Gold (XAU) kept to a tight whippy range with USD weakness fighting a slump in gold demand from safe haven flows. Overall trading with a low of USD$915 and high of USD$930 before ending the New York session at USD$924 an ounce.
Technical Analysis: Americas Quantitative Easing Plans Hurt Dollars Demand
Euro (EUR)
Euro – 1.2975 : Initial support at 1.2834 (Mar 16 low) followed by 1.2733 (Mar 12 low). Initial resistance is now located at 1.3093 (Feb 9 high) at followed by 1.3179 (Jan 29 high).
Yen (JPY)
Yen – 98.20 : Initial support is located at 95.67 (Mar 12 low) followed by 94.63 (Jan 6 resistance). Initial resistance is now at 98.85 (Mar 11 high) followed by 99.19 (Mar 9 high).
Pound Sterling (GBP)
Pound – 1.4065 : Initial support at 1.3864 (Mar 13 low) followed by 1.3703 (Mar 12 low). Initial resistance is now at 1.4305 (Mar 6 high) followed by 1.4384 (Feb 26 high).
Australian Dollar (AUD)
Australian Dollar – 0.6595 : Initial support at 0.6513 (Mar 13 low) followed by the 0.6402 (Mar 11 low). Initial resistance is now at 0.6643 (Feb 13 high) followed by 0.6799 (Feb 10 high).
Gold (XAU)
Gold – 923 : Initial support at 906 (Mar 12 low) followed by 889 (Mar 2 low). Initial resistance is now at 944 (Mar 6 high) followed by 958 (Mar 2 high).
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