forex market insight 06 july 2011

8/6/2019 Forex Market Insight 06 July 2011

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Market Insights 6 July 2011

Risk sees reversal as Portugal downgraded to ‘junk’ by Moody’s

US equities weaker after lower-than-expected result from factory orders

AUD trades back below 1.0700 after RBA keeps rates on hold

Gold and oil surge higher as both break above key resistance levels

Dow drifts lower to close 0.1% downEurope in focus tonight with Eurozone GDP and German factory orders due this evening

Headlines

AUD/USD

XAU/USD

Resistance

1.0780

Support

1.0600Market Sentiment

Bearish

Some of the heat has come out of the Aussie over the last 24 hours after the RBA doused expectations of two further ratehikes this year. This could see the Aussie come back to test support at 1.0600. After seeing a move back to 1.0600, traderscould then be looking to a bounce from support.

Gold popped higher overnight after US factory orders came in below expectations. For gold, the driver remains the outlookfor further stimulus from the US government, so any disappointing news on US economic growth is likely to see gold pushedhigher. That said, the technical outlook is still bearish, so trader will be looking at the overnight move as a potential entry for

Resistance

1515

Support

1480Market Sentiment

Bearish



EUR/USD

GBP/USD

USD/JPY

The USD/JPY is still trapped in its trading range, with last night’s move higher unable to breach 81.25 resistance. From heretrader will be looking for a move back to support at 80.40/60 before rebuilding long positions.

The pound remains trapped by downward pressure, but the most recent price action is signaling the potential for an upsidebreak. Overnight, we saw the pound break above resistance at 1.6100, but yet again the sellers pushed the pair lower. Theupward trending lower support line suggests bullish pressure is rising, and a break of 1.6140 could see a sharp move higher.

The Euro has failed to sustain the move above 1.4530 and the sellers have driven the pair back into the symmetrical trianglpattern. This changes the picture to bearish and setups up a potential move back to 1.4200. In the near term, initial support iseen at 1.4340.

Resistance

1.4530

Support


Bearish

Resistance

1.6140

Support


Rangebound

Resistance

81.25

Support

80.40/60Market Sentiment

Bullish



SILVER

USD/CHF

GBP/JPY

A recent bout of yen weakness has seen the GBP/JPY push higher and break above resistance at 130.00. As long as thGBP/JPY holds above 130.00, traders will be looking for further gains, however, this pair remains in a strong downtrend aany move back below 130.00 is likely to see the downtrend continue.

The USD/CHF has moved lower from the top of the trading range and the market now expects a move back to support around83.30. The USD/CHF remains dominated by the bears and traders will be looking to follow the path of least resistance lower.

Silver surged higher along with gold and oil overnight, bringing the precious metal back to resistance at 35.50. We’re at crucial juncture now, with any break above 35.50/36.00 bullish, but if silver can’t break higher, the market will be looking for amove back to support at 33.30.

Resistance

35.50

Support


Bearish

Resistance

85.50

Support


Bearish

Resistance

130.80

Support


Bullish



AUD/JPY

OIL

Economic Calendar

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F/Cast Last F/Cast Last

» GBP: Halifax HPI m/m 0.1% 0.1% » CAD: Building Permits m/m 5.1% -21.1%

» EUR: Final GDP q/q 0.8% 0.8% » USD: ISM Non Manuf PMI 53.9 54.6

» EUR: German Factory Orders -0.5% 2.8% » » » » » »

The crude market has pushed higher overnight in line with the move higher in gold and silver. This changes the market’s

view on crude to more bullish and traders will be looking for any move back to 95.80 as an opportunity to take new longpositions.

The Aussie-yen has held relatively steady after yesterday’s decision to hold interest rates steady and this can be seen asbullish for this pair. Support is seen at 86.00/40 and any move back into this zone is likely to be seen as a buyingopportunity.

Resistance

97.50Support


Bullish

Resistance

87.60/88.00Support

86.00/40Market Sentiment

Bullish

forex market insight 06 july 2011

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