The Flying L Trader – July the 30th

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A weaker US home sales number including a downgrade of previous months, but better than forecast, so the US dollar gains in strength. As you can see, the market is driven by the expectations of the figure, not the actual number. Everyone is positioned with a view that it will be out at -1.1% and it comes in at -0.4% so the market gets bullish and has to readjust their portfolios, even though -0.4% is not a great number. The flip side and headlines say that a weaker number (-0.4% compared to previous months +5.8%) sent stocks into the red. A minor amount, but still red.

Europeans were flat and everyone is waiting for Wednesday and Thursday before committing to a direction. So all quiet on the currency front, although today we will be waltzing our Matilda down under to the tune of buildings and Stevens. Did you know that Waltzing Matilda was runner up in the national anthem song search of the early 70’s? In the 1977 referendum it gathered 28% of the votes, behind Advance Australia Fair of 43%. Bit of trivia for you.

I found this article of interest last night. The central bankers are starting to become aware of their effect on the market and using it to their advantage.

DATA HIGHLIGHTS AHEAD (times are in AEST) – 1130am AU Building Approvals. 105pm RBA Stevens speaks. 12am US Consumer Confidence.

AUDUSD – Now a lower high and low so still frothing about, and it is not becoming boring to watch, it is boring. A ring high yes, but massive support at 9138 so I am still on the sidelines.

Resistance: 9390/9435/9590
Support: 9138/8985/8760

EURUSD – A LHLL so will be moving stop up to just under minor support of 13230, nothing else to add to this as we wait ECB, BOE and FOMC.

Resistance: 13400/13700/14260
Support: 13040/13000/12750

GBPUSD – A LHLL as well, so will move one of the stops up and under the bar. Is literally frothing about above the 50ema and I read a respected currency trader who is targeting 1.45 by end of year… A break below 1.5270 and I will have to concede my trade 2nd trade, as I have moved its stop to under the support of that level.

Resistance: 15405/15608/15750
Support: 15270/15080/15000

NZDUSD – Rolling over under pressure from the resistance levels of 81¢ and 0.8050 with a LHLL and if it breaks lower today I will be short the kiwi.

Resistance: 8100/8125/8170
Support: 7815/7710/7658

USDCAD – A LHLL but looks to be flattening out as the lows are smaller each time. It is in my BUY ZONE so will be keeping a keen eye out for buying sentiment.

Resistance: 10315/10420/10597
Support: 10225/10100/10000

USDJPY – Another LHLL with and a doji and is in the middle of nowhere right now.

Resistance: 9830/9980/102.53
Support: 9690/9497/9415

GOLD – A nothing inside bar, a NR4 if you will. Not interested.
Resistance: 1354/1,425/1,489/
Support: 1307/1,226/1,160

David Long/ Proprietary Trading Manager

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