David Long

BOJ sits on the fence while UK pounds faster and Euro weakness abates – March the 9th, 2014

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The BOJ sits on the fence whilst the UK pounds faster and Euro weakness abates. The theme overnight was sell the greenback and not for any individual particular reason I can determine.

In Europe ECB policy makers have been undermining Draghi’s comments from last week of “unanimous look at asset purchase program”, which has seen a reversal in Eurobonds and a bid in the currency. This has been somewhat offset by renewed Ukrainian issues, so the stock market came off or was flat.

Across the channel however, the poms manufacturing is on fire! 3 months now of growth and just as I was looking at the cable run finishing it spiked 100+ pips. The data is opposite to the recent string of economic signals from the UK so Thursday’s BOE meeting will be key for me to see the lay of the land for the pound.

In the commodity world and commodity currencies there was also a bid, but this I think is more due to greenback weakness then any sustainable numbers. Commodity Index was stronger overnight despite a minor fall in oil. Australia is not producing great numbers, but nor are they printing negative and so is being pushed around by yield hunters and the US$. The Kiwi on the other hand has good numbers coming out, whilst the Canadians printed another shocker overnight. Building permits way down so the Loonie may not be out of the woods yet.

DATA HIGHLIGHTS TODAY – AU Home loans. UK & EU Trade Balance. US FOMC Minutes. 

AUDUSD – A decisive break through ninety three cents and perilously close to next resistance all in one day. A very bullish bar and momentum is high, can’t sell, nor buy.

Resistance: 9390/9460/9522

Support: 9085/8900/8654

EURUSD – A nice strong day but we are still being squeezed in by the monthly wedge. I want to be in it but just cannot bring myself to trade this yet. Still getting mixed data and price action signals.

Resistance: 14050/14260/14320

Support: 13646/13565/13488

GBPUSD – Well, what a surprise, go you good thing! Unfortunately I was not on it as I saw the little cycle of last week being a weak signal. Resistance at 1.68 is quiet strong and now momentum is high it will be interesting to see how the cable performs when it gets there.

Resistance: 16785/1.69/1.70

Support: 16300/15950/15830

NZDUSD – On resistance but still showing signs of further upside.

Resistance: 8676/8842

Support: 8090/7925/7714

USDCAD – A battle of the weaklings. 1.09 is a long term support area and this, like many other pairs is in the middle to end of the run so no entry yet.

Resistance: 11170/11233

Support: 10953/10859/10715

USDJPY – HA! Now it has pulled back too far. Central wankers, they never help. Not interested in this now, still want to buy it fundamentally but price action is against me.

Resistance: 105.57/108.35/110.50

Support: 100.62/100/99.80

GOLD – Inching higher again on Ukrainian news and greenback weakness. On the ema still though so either way is possible.

Resistance: 1427/1480

Support: 1,265/1,180/1,040


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