Daily FX Report
Good morning from wonderful Hamburg and welcome to the Varengold Daily FX Report. The German athletes earned four gold medals yesterday and jumped from 19th place to 6th place in the Olympic medal standings. We hope for more good results in the next few days.
Markets review
The EUR was mostly unchanged against the USD and traded at 1.4925 this morning, off the day's low of 1.4885 and also off a six month low at 1.4815 hit on Tuesday. The USD's sharp rebound benefited from a steep drop in oil and other commodity prices, while the USD regained strength against the EUR on clearer signs that growth is slowing in the euro zone. Last Friday the EUR suffered its biggest one day drop since January 2001.
The USD/JPY fell 0.6% further on the day to a low at 108.55, as the AUD/JPY and NZD/JPY started to drop more than 1 %. Australian Q2 wage growth increased 1.2 % from the previous quarter, above the median forecast of a 1.0 % increase. However, wage growth still remains below levels seen as a threat to inflation. The AUD was down 0.5% to a low of 0.8671 against the USD.
The NZD/JPY hit a 2-year low of 73.87 and was going below the psychologically important level at 74.20. The NZD/USD decreased 0.3 % to 0.6912, after hitting an eleven month low of 0.6896 earlier in the day. Some traders said this was caused as Japanese investors dumped NZD on expectations that the currency will fall further.
Technical analysis
EUR/GBP
For the last five months the EUR/GBP has traded in a horizontal trend channel with a resistance at 0.802 and a support level at 0.7777. After touching the resistance for the third time, the market started a bearish trend to its support line. Should the market break trough the support line, we could expect a longer term bearish trend.
GBP/CHF
Since the middle of April, the GBP/CHF has been trading in a horizontal trend channel. After touching the support level at 2.0063 for the third time, the market started to trade close to the resistance at 2.0816. If the market breaks trough the resistance, the market could establish an increasing trend.
Pivot Points - Daily FX Support and Resistance Levels
Daily Calendar & Key FX Events
Varengold Bank
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