forex market insight 28 july 2011

8/6/2019 Forex Market Insight 28 July 2011

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Market Insights 28 July 2011

USD higher, equities sold, as risk aversion finally kicks in

AUD, NZD both make new record highs before late reversal; BNZ keeps rates on hold

EUR sharply lower as German finance minister warns ‘no blank cheque’

BoJ board member Kamezaki warns Japan will take ‘proactive’ action on yen gains

US share markets hit by heavy selling, Dow falls 1.6%

US employment numbers due at 10.30pm likely to take back seat to debt negotiations

Headlines

AUD/USD

XAU/USD

Resistance

1.1080

Support

1.1010Market Sentiment

Bullish

The Aussie surged to new post-float highs after yesterday’s higher-than-expected CPI numbers. The market has since pulledback to support at 1.1010 and traders will be looking to take new longs while we trade above 1.1010. A break below 1.1010sets up a move to 1.0950.

Gold produced a false break above 1625 overnight and this sets up a move back to the lower end of the trading range at1610. Traders will continue to focus on building new longs above that level, but with the market now apparently becomingmore concerned about the US debt situation, the negative correlation between gold and the USD could be beginning to break

Resistance

1625

Support

1610Market Sentiment

Bullish



EUR/USD

GBP/USD

USD/JPY

The dollar-yen’s move lower continues with the recent move to 78.00 seen as an opportunity to take new shorts. Yesterday’warning from the BoJ that they are considering policy move to intervene in the market might keep the market cautious.

Unsurprisingly, the pound is in a similar position to the Euro, with last night’s selldown seen as a warning that the pair mightbe due to reverse. That said, the market will remain bullish while the pair trades above 1.6260, but a break below that levelwill be bearish.

Despite last night’s heavy selldown on the Euro, traders are likely to give the pair the benefit of the doubt and continue tofavour longs while we trade above 1.4325. A clear break of 1.4325, however, will be seen as bearish.

Resistance

1.4530

Support


Bullish (while above 1.4325)

Resistance

1.6440

Support


Bullish (while above 1.6260)

Resistance

78.00

Support


Bearish



SILVER

USD/CHF

GBP/JPY

No real change with the ascending triangle formation dominating the price action. Traders will continue to take shorts aroun128.20 until we see a clear break above this level while a break below 127.00 will also see further selling.

The USD/CHF continues to be hit by the USD weakness and we didn’t see the same kind of greenback reversal as we saw inother markets. Traders will be waiting for a move back to resistance at 80.80 or a break below 80.00 for new shorts.

As per most other markets, the overnight reversal has seen silver sent back to support at 40.00/20. Traders will be looking fonew longs around this level, but a continuation of the USD strength could see silver break below lower support on thascending triangle.

Resistance

41.00

Support

40.00/20Market Sentiment

Bullish

Resistance

80.80

Support


Bearish

Resistance

128.20

Support


Bearish



AUD/JPY

OIL

Economic Calendar

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F/Cast Last F/Cast Last

» JPY: Retail Sales -0.6% -1.3% » USD: Unemployment Claims 413k 418k

» EUR: German Unemployment -15k -8k » USD: Pending Home Sales m/m -1.5% 8.2%

» GBP: CBI Realized Sales 1 -2 » USD: Natural Gas Storage 38B 60B

» » » » »

Crude has clearly broken lower and this now puts the ball in the bears’ court. Traders will be waiting for a move back to

97.00 in order to take new shorts.

The market looks to be still bullish on the AUD/JPY and waiting for a clear break above 86.00. A pullback to 85.20 will also beseen as a buying opportunity.

Resistance

97.00Support


Bearish

Resistance

86.00Support


Bullish

forex market insight 28 july 2011

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