Daily FX Report

Good morning from sunny Hamburg, and welcome to Varengold's Daliy FX Report. Yesterday we were all surprised by the big defeat of World Champion team Italy against Netherlands. That was not the case for the FOREX market, as the market remained stable during the whole session and there were not any surprises.

Markets review

The USD jumped on Monday, as top Treasury and Federal Reserve officials voiced concern about its slide. This comments raised the chances that officials could step into the foreign exchange market to support the US currency. The USD rose by more than 1% against the EUR and JPY after Federal Reserve Chairman Ben Bernanke said the central bank would strongly resist erosion in inflation expectations, convincing more investors that rate hikes could come this year. Bernanke also said that the risk of a substantial downturn in the US economy has receded.

The optimism on the USD also came by Lehman Brother's plan of increasing a capital of 6 billion USD. This could help the stabilisation of the US financial market, which has been quite delicate for the past 6 months.

The AUD/USD rebound on the market is due to the increase of profits and sales in May. This gain recovered the last months' losses. Some other data have shown that there was a drop of 3% on owner-occupied housing finance in April and a decrease of 1.7% in job offers. As a consequence, the AUD/USD dropped 1.39% to 0.9490.

Technical analysis

AUD/USD

In the middle of May the AUD/USD changed its side range one level higher. So the former resistance became a support for the new range. At the moment the AUD/USD is trading at the support. A break trough the support might be possible. However, if there is a turn, the AUD could come down again.

GBP/CHF

The GBP/CHF has developed a downward trend since end of May. The 2.0000 level could be a hard support that must be broken for further losses. We see that the currency touched right on the 2 even mark. Referring to its level in March further down potential might be possible.

Pivot Points - Daily FX Support and Resistance Levels

Daily Calendar & Key FX Events

Varengold Bank

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