forex market insight 18 july 2011

8/6/2019 Forex Market Insight 18 July 2011

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Market Insights 18 July 2011

Markets finish last week on slightly positive note, despite weaker US economic data

EUR, GBP ease lower into weekly close

AUD sharply lower on Friday after Westpac first bank to say RBA might cut rates

Dow sees late rally to close 0.3% higher, Nasdaq gains 1.0%

Risk currencies gap lower on Monday openThis week’s big driver likely to be US debt ceiling discussions with 22 July deadline looming

Headlines

AUD/USD

XAU/USD

Resistance

1.0800

Support

1.0620Market Sentiment

Bearish

The Aussie was hit on Friday night after Westpac came out as the first bank to downgrade expectations for further interestrate increases. This news led the AUD/USD below previous support at 1.0695 and support now moves lower to 1.0620. Abreak of support at 1.0620 sets up a move back to 1.0500.

Gold has popped higher on Monday morning’s open but failed just shy of 1600. This level will be of crucial importance andtraders will be waiting for a break of that level to participate in the next move higher. Looking lower, support is seen at 1575(at the previous all-time highs) and traders will also be looking to pick up new longs at these levels.

Resistance

1600

Support

1575Market Sentiment

Bullish



EUR/USD

GBP/USD

USD/JPY

The USD/JPY remains trapped in its broad new trading range below 79.60. Any move back into the 79.30/60 zone is likely tattract new sellers. A clear move below 78.50 could cause the Bank of Japan to intervene in currency markets so any movlower will see traders become more cautious of upside risks.

The pound’s inability to push above 1.6200 now present a more bearish picture and the downbeat tone of early Mondaytrading also suggests that the pound might face pressure early this week. In the near term, a break of 1.6075 will producefurther selling with the potential for a move back to 1.5950.

The Euro has failed at the underside of the multi-week symmetrical triangle and this set up the EUR/USD for further falls. TheEuro gapped lower this morning, so traders will be looking to take new shorts on any signs of strength. The next level fosupport is seen at 1.3960 and then at 1.3840.

Resistance

1.4200

Support


Bearish

Resistance

1.6200

Support


Bearish

Resistance

79.60

Support


Bearish



SILVER

USD/CHF

GBP/JPY

No real change on the GBP/JPY, with the pair struggling at resistance at 128.20. While the pair remains under 128.20, thmarket is likely to focus on the downside. Over the medium term, any move lower is likely to target 125.30.

The USD/CHF continues to trade at lower levels and the fear surrounding the US’s debt negotiations continues to grow. Thmarket remains focused on the downside on this pair, with any move up to 82.00, or a break below 80.80, seen as anopportunity for new shorts.

Silver saw some slight selling pressure toward the end of last week, but it’s managed to bounce from higher support levels andis now moving back toward the recent highs at 39.40. With gold surging higher in recent weeks this has helped silver also posgains. A break of 39.40 will be seen as bullish.

Resistance

39.50

Support


Bullish

Resistance

82.00

Support


Bearish

Resistance

128.20

Support


Bearish



AUD/JPY

OIL

Economic Calendar

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F/Cast Last F/Cast Last

» AUD: New Motor Sales -7.6% » USD: NAHB Housing 15 13

» USD: TIC Long Term Purch 48.4B 30.6B » » » » » » » »

Crude oil remains trapped in the middle of the larger trading range and trader will be waiting for a move to either extreme

before taking new positions. With global markets starting the week on a downbeat note, a break of 94.00 will be seen abearish.

The AUD/JPY has been driven below support at 84.20 on the back of Westpac’s downgrade of local interest rate expectationsThe next major level to the downside is 83.20 with and breach of that level likely to be seen as extremely bearish for thispair.

Resistance

99.00Support


Rangebound

Resistance

84.20Support


Bearish

forex market insight 18 july 2011

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