MIDDAY SNAPSHOT & ANALYSIS OF SELECTED RATES
Price action was relatively quiet in the New York morning session, with currencies initially finding some bids on the back of the much better than expected JP Morgan earnings and impressive initial jobless claims numbers. However, any initial rallies were short-lived with the Euro stalling out by 1.4165 on some broad based profit taking and then pulling back more sharply towards 1.4100 on a much softer Philly Fed result and discouraging TICS data showing an outflow of $66.6B. The Yen remained the strongest currency on the day heading into the afternoon, while Kiwi remained the laggard following the overnight downgrade of the country’s credit outlook from Fitch. US equities are relatively unchanged, while commodities are marginally offered.
ANALYSIS OF SELECTED RATES
Eur/Nzd: Has been very well supported over the past several weeks on dips towards the 2.1500 level, with attempts to break below back in early and late June failing and resulting in 10 figure rebounds to 2.2500. The latest reversal has once again opened a move back towards 2.1500, with setbacks also once again stalling out on Wednesday by 2.1650 ahead of Thursday’s bullish reversal to end a sequence of 3 consecutive daily lower lows and 4 consecutive down days. Look for a break back above 2.2040 over the coming hours to confirm bullish resumption and open fresh upside back towards 2.2500. A break back above 2.2040 will also increase potential for the formation of an inverse head & shoulders on the daily chart that would suggest some material basing and a move back towards 2.3500 over the coming weeks.
Written by Joel Kruger, Technical Currency Strategist for DailyFX.com
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“Midday Snapshot” – A Midday Fundamental Update, along with Technical Analysis of Selected Rates.
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