Currency Tech

EURUSD  R 2: 1.4550  R 1: 1.4500  CURRENT: 1.4430 S 1: 1.4300  S 2: 1.4245 GBPUSD  R 2: 1.6470  R 1: 1.6385 CURRENT: 1.6414 S 1: 1.6210  S 2: 1.6170 USDJPY  R 2: 81.25  R 1: 81.00 CURRENT: 80.28 S 1: 79.95 S 2: 79.55 AUDUSD  R 2: 1.0725 R 1: 1.0665  CURRENT: 1.0637 S 1: 1.0510  S 2: 1.0440

Market Brief

Asian market data released earlier this morning from China and Japan saw risk appetite improving as China posted inflation of 5.5%, industrial production rose 13.3% more than estimates which were mostly in line with analyst expectations which could keep the case for further rate hikes strong. Japan kept its interest rate unchanged at 0.1% and did not add to the asset purchase program although the BOJ limited its extra assistance for the economy to $6 Billion for earthquake assistance. Yesterday’s news of Greece downgrade by S&P to its lowest level of CCC saw the Euro dropping to lows and Dollar strength saw risk aversion trading in the markets. Fed’s Fisher yesterday reiterated his view that the central bank has done enough to support the US economy and indicated he won’t support QE3, adding that it would be the worst outcome of all for the Fed to continue supporting the economy. Also, Fed’s Lacker said that recent US data have prompted him to consider lowering his growth forecast and the economy could remain weak in the short term. Greece saw its ratings plunge to the lowest in the world by S&P to CCC, where the S&P said that the nation is increasingly likely to face a debt restructuring and the first default in the EU area. After the Chinese data release, the Dollar and yen dropped against most currencies as risk appetite picked up with EURUSD moving up to highs of 1.4473, GBPUSD moving to highs of 1.6442 on inflation expectations, AUDUSD moved to 1.0648, NZDUSD moved to 0.8195 after Chinese economic growth shown to be steady. We have UK inflation figures to keep the Pound higher while US releases advanced retail sales could show decline 0.5% which could see Dollar weakness due to a weak US economy followed by producer prices.