Australian FOREX Daily Outlook 13/04/2009

USD gains on Profit taking

13/04/09                                                                                                                                             

last week’s currency trading review

The Dollar struck back at losses seen over the last 2 weeks to gain heavily after better than expected US data led some analysts to see the US coming out of the economic crisis before Japan and Europe. The FOMC minutes talked of more downside risks to the economy with the Fed cutting the GDP 2009-10 outlooks. The Euro was the main currency in the action last week with extreme weakness against some crosses underpinning the concern investors have with the EU. EUR/CAD and EUR/AUD dropped over 2.5% each as risk appetite improvement translated to gains in the commodity currencies. The EUR/USD fell -2.38% closing at 1.3168, after opening the week at 1.3482. The Japanese Yen had a choppy week with Year highs on Monday being given back as the Stock rally floundered and crosses led by the EUR/JPY drove lower. The BOJ met and held at 0.1% although the BOJ did widen the collateral accepted for lending. The USD/JPY gained 0.10% closing at 100.41 after opening at 100.31. The GBP fell back in sympathy with the EURO although remained buoyant and found interested buyers on dips as improvement in Risk sentiment supported the crosses. The GBP/USD fell -1.10% closing at 1.4679 after opening at 1.4841. The AUD was the main recipient of market improvements as commodities remained well supported and most Aussie crosses broke higher. The RBA cut by 0.25% and the Unemployment Rate jumped to 5.7% from 5.2% previously. The AUD/USD closed up 0.54% at 0.7191 after opening at 0.7150.

The forex trading week preview

In the States No Data Easter Monday. On Tuesday we get a further insight to how the US consumer is holding up with March Retail Sales forecast at 0.3% vs. -0.1% previously. Also released PPI (Mar) is forecast at 0.0% vs. 0.1% previously. On Wednesday we have March Industrial Production and Capacity Utilization forecast at -0.9% and 69.7% respectively. On Thursday we have (Mar) Building Permits forecast at 550K vs. 547K previously. Also released, Housing Starts forecast at 550K vs. 583K previously. On Friday we have Preliminary April UoM Consumer Confidence forecast at 58.2 vs. 57.3 previously. We will provide our previews and reviews of these data releases in the daily summary.

In the Eurozone light data week with Thursday’s CPI(Mar) forecast to remain at 0.6% y/y. Also released Industrial Production forecast at -2.5% vs. -3.5% previously. In the UK light data week with RICS House Price Balance forecast at -77.2% vs. -78.3%. We will provide our previews and reviews of these data releases in the daily summary.

In Japan On Friday we have Tertiary Industry Activity forecast at -0.7% m/m. We will provide our previews and reviews of these data releases in the daily summary.

In Australia Nab Business Confidence (Mar) released on Tuesday previously at -22. We will provide our previews and reviews of these data releases in the daily summary.

·                Euro – 1.3145

Initial support at 1.3127 (Apr 9 low) followed by 1.3113 (Mar 30 low). Initial resistance is now located at 1.3420 (April 7 high) at followed by 1.3592 (Mar 27 high)

·                Yen – 100.35

Initial support is located at 99.32 (Apr 8 low) followed by 98.23 (Apr 1 low). Initial resistance is now at 100.87 (Apr 8 high) followed by 101.44 (Apr 6 high).

·                Pound – 1.4635

Initial support at 1.4584 (Apr 7 low) followed by 1.4450 (Apr 2 low). Initial resistance is now at 1.4986 (Feb 9 high) followed by 1.5154 (Jan 12 high).

·                Australian Dollar – 0.7215

Initial support at 0.7203 (Apr 7 high) followed by the 0.7034 (Apr 8 low). Initial resistance is now at 0.7229 (Apr 3 high) followed by 0.7268 (Jan 7 high).

·                Gold – 884

Initial support at 865 (Apr 6 low) followed by 852 (Jan 23 low). Initial resistance is now at 909 (Apr 1 high) followed by 933 (Mar 26 high).

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