Major currencies weakened against the dollar on slower central bank flows and increased profit taking. In particular, the Australian dollar took a hit today in early trading on the release of weaker Australian first quarter CPI figures, 0.1% actual versus 0.6% expected. The Euro has been range-bound so far this week between 1.3540 support and 1.3585 resistance.
News and Events:
Major currencies weakened against the dollar on slower central bank flows and increased profit taking. In particular, the Australian dollar took a hit today in early trading on the release of weaker Australian first quarter CPI figures, 0.1% actual versus 0.6% expected. AUDUSD traded from 0.8332 to 0.8235 on the news and has since come up to 0.8245. Look for strong support at 0.8180. A recovery back to 0.8300 could signal a continuation of the uptrend. Pay attention to today’s and tomorrow’s close price for directional clues.
The Euro has been range-bound so far this week between 1.3540 support and 1.3585 resistance. The pair could not break down below 1.3550 in early trading today, indicating fairly strong buying at that level. Buy on pullbacks but confirm with a break above 1.3585 to remain long.
Today’s most interesting chart is EURPLN. The pair has been in a down trend for the past month, showing no indications of moving out of the channel. Our target remains at 3.7500 in the near-term. Sell on pullbacks.
Today’s Key Issues (time in GMT):
EUR 8:00 European Central Bank Euro-Zone Current Account (FEB)
EUR 8:00 Euro-Zone Current Account not seasonally adjusted (FEB)
EUR 8:00 Italian Retail Sales, seasonally adjusted (MoM) (FEB)
EUR 8:00 Italian Retail Sales (YoY) (FEB)
CHF 8:00 UBS Consumption Indicator (MAR)
GBP 8:30 Public Finances (PSNCR) (British pounds) (MAR)
GBP 8:30 Public Sector Net Borrowing (British pounds) (MAR)
EUR 9:00 Industrial New Orders seasonally adjusted (MoM) (FEB)
EUR 9:00 Industrial New Orders (YoY) (FEB)
CAD 12:30 Leading Indicators (MoM) (MAR)
USD 12:55 Federal Reserve’s Red Book (APR 21)
USD 13:00 S&P/CS Composite-20 Home Price (FEB)
USD 13:00 S&P/CS Composite-20 (MoM) (FEB)
CAD 13:00 Bank of Canada Rate Decision
GBP 13:15 U.K. CBI April Industrial Trends Survey
GBP 13:15 CBI Industrial Trends Monthly - Total Orders (APR)
GBP 13:15 CBI Industrial Trends Monthly - Export Orders (APR)
USD 14:00 Richmond Fed Manufacturing Index (APR)
USD 14:00 Consumer Confidence (APR)
USD 14:00 Existing Home Sales (MAR)
USD 14:00 Existing Home Sales (MoM) (MAR)
CHF 16:15 Swiss National Bank’s Hildebrand Speaks on Swiss Franc
USD 21:00 ABC Consumer Confidence (APR 22)
The Risk Today:
EurUsd: range-bound so far this week between 1.3540 support and 1.3585 resistance. The pair could not break down below 1.3550 in early trading today, indicating fairly strong buying at that level. Buy on pullbacks but confirm with a break above 1.3585 to remain long.
GbpUsd has traded lower and lower since its high on April 18th. Look for the pair to trade to 1.9933, a 50% retracement from the 2.0133 high.
UsdJpy: pay close attention to the daily close today. 118.63 is a key level right now, a close above could signal a push back into the bullish channel. A close below could signal a break down. Hold back and wait until tomorrow on this one.
UsdChf ever since February, the pair has continued to make lower lows and lower highs. Key resistance for this pattern remains at the trend line at 1.2225. Initial support is 1.2000.
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Resistance and Support:
By James Brandt, ACM Advanced Currency Markets, Geneva, Switzerland