Goldman Sachs Under Pressure
Last week’s currency trading review
The Dollar was able to gain against most currencies as the Euro tested fresh year lows but ended the week well of highs as a expanded bailout package for Greece supported a relief rally on Friday. Volatility in stock markets was sparked by the Goldman Sachs Fraud inquiry and concerns about the US Financial Regulation bill. US data was largely positive with CB Consumer confidence jumping to 57.9 vs. 52.3 previously and weekly Jobless claims falling to 448k vs. 459k previously. US GDP was slightly weaker than expected in Q1 at 3.2% vs. 3.4% forecast but was still solid. The Euro traded near 1.3100 at fresh year lows on Wednesday as Spain was downgraded by S& P and this was on the back of Greece downgraded to Junk bond status Tuesday. The rest of the week saw a solid rally with speculation of an expanded and quickly agreed upon rescue package for Greece doing the rounds. Also helping was strong European economic data with March German Unemployment Change at -68k vs. -11k forecast.The EUR/USD lost -0.66% closing at 1.3293, after opening the week at 1.3381.
The Japanese Yen was very strong on Tuesday as USD/JPY dipped below Y93 and EUR/JPY dipped below below Y123 but was then on the back foot for the rest of the week as US stock markets showed resilience and EUR/JPY recovered well. The BOJ held at 0.1% as expected and once again noted concern about deflationary pressures in Japan.The USD/JPY fell -0.13% closing at 93.84, after opening at 93.96 previously. The GBP ended the week well off highs as the UK was dragged into the rating downgrades story early in the week and traders speculated on the possibility of the sovereign debt crisis spreading to the UK. Also moving the Pound was changes in election polls with a UK Conservative’s win expected to support. TheGBP/USD fell -0.68% closing at 1.5272 after opening at 1.5376. The AUD shrugged off the European concerns and ended higher on the week as commodities rallied and speculation of a RBA rate hike increased on inflation data. Q1 CPI was at 0.9% vs. 0.8% and at the top end of the RBA inflation band range. The AUD/USD gained +0.37% closing at 0.9271 after opening at 0.9243.
The forex trading week preview
In the States On Monday, April ISM Manufacturing is forecast at 59.8 vs 59.6 previously. On Tuesday, March Pending Home Sales is forecast at 3.7% vs. 8.2% previously. On Wednesday, April ISM Non Manufacturing is forecast at 56 vs 55.4 previously. On Thursday, Weekly Jobless Claims are forecast at 440k vs. 448k previously. On Friday, Unemployment Rate is forecast at 9.7% vs. 9.7% previously. Also released, April Non Farm Payrolls are forecast at 180k vs. 162k previously. We will provide our previews and reviews of these data releases in the daily summary.
In the Eurozone On Monday, March German Retail Sales are forecast at -0.4% vs. -0.9% y/y. On Wednesday, EU Retail Sales are forecast at 0.0% vs. -0.6% m/m. On Thursday, ECB Rate Announcement forecast to remain at 1.0% and ECB President Trichet Speaks. On Friday, March Industrial Production is forecast at 1.5% vs. 0.0% previously. In the UK On Tuesday, April PMI Manufacturing is forecast at 57.3 vs. 57.2 previously. On Wednesday, April PMI Construction is forecast at 53.5 vs. 53.1 previously. On Thursday, UK General Election. Also released, April PMI Services forecast at 56.6 vs. 56.5. On Friday, April PPI is forecast at 4.85 vs. 5.0%. previously. We will provide our previews and reviews of these data releases in the daily summary.
In Japan Bank Holiday Monday-Wednesday. In Australia On Tuesday, RBA Rate Announcement is forecast at 4.5% vs. 4.25% previously. On Wednesday, New Zealand Unemployment Rate is forecast at 7.3% vs. 7.3% previously. On Thursday, March Trade Balance is forecast at -2.1bn vs. 1.9bn previously. Also released, March Retail Sales forecast at 0.7% vs. -1.4% previously m/m. On Friday, RBA Quarterly Monetary Policy Statement. We will provide our previews and reviews of these data releases in the daily summary.
TECHNICAL COMMENTARY
|
Currency |
Sup 2 |
Sup 1 |
Spot |
Res 1 |
Res 2 |
|
EUR/USD |
1.2965 |
1.3115 |
1.3230 |
1.3416 |
1.3523 |
|
USD/JPY |
92.25 |
92.74 |
94.00 |
94.79 |
95.29 |
|
GBP/USD |
1.4805 |
1.5126 |
1.5270 |
1.5524 |
1.5688 |
|
AUD/USD |
0.9003 |
0.9137 |
0.9250 |
0.9364 |
0.9406 |
|
XAU/USD |
1135.00 |
1146 |
1178.00 |
1183 |
1226.00 |
|
OIL/USD |
85.00 |
86 |
86.30 |
88 |
90.00 |
Euro – 1.3230
Initial support at 1.3115 (Apr 28 low) followed by 1.2965 (Apr 29 2009 low). Initial resistance is now located at 1.3416 (Apr 27 high) followed by 1.3523 (Apr 20 high)
Yen – 94.00
Initial support is located at 92.74 (Apr 22 low) followed by 92.25 (38.2% retracement of 88.13 – 94.77). Initial resistance is now at 94.79 (Aug 5 high) followed by 95.29 (Aug 18 High).
Pound – 1.5270
Initial support at 1.5126 (Apr 28 low) followed by 1.4805 (Mar 26 low). Initial resistance is now at 1.5524 (Apr 15 low) followed by 1.5688 (Feb 18 low).
Australian Dollar – 0.9250
Initial support at 0.9137 (Apr 28 low) followed by the 0.9003 (Mar 26 low). Initial resistance is now at 0.9364 (Apr 15 high) followed by 0.9406 (Nov 16 high).
Gold – 1178
Initial support at 1146 (Apr 27 low) followed by 1135 (Apr 23 low). Initial resistance is now at 1183 (0.764 of 1126.56-1044.85) followed by 1226 (Dec 5 high).
Oil – 86.20
Initial support at 86.00 (Intraday Support) followed by 85 (Intraday Support). Initial resistance is now at 88.00 (March high) followed by 90.00 (Intraday Resistance).
