US data supports Greenback into the weekend

CURRENCY TRADING SUMMARY – 28th July 2008 (00:30GMT)

· U.S. Dollar Trading (USD) slightly stronger stocks, improving US economic data and stable Oil prices all combined to give the USD a solid footing into the weekend. June Durable Goods Orders beat expectations at 0.8% m/m along with Core Orders at 2.0%. University of Michigan Consumer Sentiment showed a surprise jump to 61.2 from 56.2. New Home sales also beat forecasts falling 0.6% to 530K vs. expectations of 505K. In the U.S. share markets, the NASDAQ was up 30 points (1.33%) and the Dow Jones was up 21 points (0.19%). Crude Oil closed down $2.23 ending the New York session at $123.26 per barrel.

· The Euro (EUR) traded higher during the European session touching day’s highs after the market digested higher than expected German Import Prices of 1.5% vs. 1.0% forecast. The strong US data saw the Euro retreat to Asian lows. EUR/JPY rebounded strongly as equities turned positive. Overall the EUR/USD traded with a low of 1.5668 and a high of 1.5754 before closing the day at 1.5690 in the New York session. Looking ahead, German Consumer confidence seen at 3.5 down from 3.9 in July.

· The Japanese Yen (JPY) traded in very large range gaining during the Asian session as Core CPI came in at 1.9% (at expectations) and stocks were weak. Reversal of sentiment in the European session saw a large bounce and subsequent rally in all crosses especially the GBP/JPY. Overall the USDJPY traded with a low of 106.58 and a high of 107.95 before closing the day around 107.90 in the New York session.

· The Sterling (GBP) rebounded as 2ndQuarter GDP came in at expectations 0.2% and strong buying of the GBP/JPY supported. UK Hometrack House Prices showed another dip, falling to -4.4% y/y in July. Overall the GBP/USD traded with a low of 1.9840 and a high of 1.9978 before closing the day at 1.9915 in the New York session.

· The Australian Dollar (AUD) came under pressure as commodities continued to slide and the USD strengthened. Overall the AUD/USD traded with a low of 0.9545 and a high of 0.9609 before closing the day at 0.9560. Looking ahead, RBA Assistant Governor Debelle speaks tonight.

· Gold (XAU) traded in a relatively small range buoyed by an increase in US Durable Goods orders but capped by the strong USD. Overall trading with a low of USD$919.40 and high of USD$934.90 ending the New York session at USD$929 an ounce.

TECHNICAL COMMENTARY

Currency Sup 2 Sup 1 Spot Res 1 Res 2
EUR/USD 1.5612 1.5629 1.5695 1.5799 1.5948
USD/JPY 106.08 106.58 107.95 107.99 108.59
GBP/USD 1.9754 1.9815 1.9885 1.9990 2.0077
AUD/USD 0.9404 0.9477 0.9530 0.9675 0.9794
XAU/USD 908.65 912.90 930.00 949.25 976.00


· Euro – 1.5695

Initial support at 1.5629 (July 24 low) followed by 1.5612 (July 23 low). Initial resistance is now located 1.5799 (July 23 high) at followed by 1.5948 (July 16 High).

· Yen – 107.95

Initial support is located at 106.58 (July 25 low) followed by 106.06 (July 22 low). Initial resistance is now at 107.99 (Jun 24 high) followed by 108.59 (Jun 16 high).

· Pound – 1.9885

Initial support at 1.9815 (July 14 low) followed by 1.9754 (July 11 low). Initial resistance is now at 1.9990 (July 24 high) followed by 2.0077 (July 22 high).

· Australian Dollar – 0.9530

Initial support at 0.9477 (July 9 low) followed by 0.9404 (Jun 18 low). Initial resistance is now at 0.9675 (June 17 low) followed by 0.9794 (July 22 High).

· Gold – 930

Initial support at 912.9 (July 8 low) followed by 908.65 (Jun 19 low). Initial resistance is now at 949.25 (July 23 high) followed by 976 (July 22 high).

Source: Easy-Forex

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