Daily FX Report

Good morning from wonderful Hamburg. Yesterday there was a shock for investors as the U.S. House of Representatives voted against the $700 bln bailout bill. The Dow Jones Industrial Average fell 778 points, or 6.98 percent to 10,365, the biggest point drop ever. The Standard & Poor's 500 Index fell 8.4 percent, the most since Oct. 26 in 1987.

Markets review

The JPY rose to its highest in almost two weeks against the EUR, an concern U.S. lawmakers' rejection of a $700 billion bank rescue plan will cause credit losses to mount, curbing demand for higher-yielding assets. JPY also gained against the AUD and NZD as the worst global stocks rout in 21 years prompted investors to cut carry trades.

The AUD/USD recovered back after the currency pair was showing a bullish face which was breaking trough the downward trend channel and is now trading around 0.800. Australians retail sales rose 0.3% in trend terms while August home building approvals fall 3.7%, released by the Australian Bureau of Statistics.

New Zealand's business confidence turned to positive in September. Inflation prospects for the next year fell to 3.65% from 3.79% in the previous month. The NZD/USD is trading now at 0.6700, back from its day low of 0.6641

Technical analysis

EUR/JPY

Since the end of August the EUR/JPY has been trading in bearish Fibonacci trend lines. After breaking trough the upper trend line the market touched the 1.57 resistance level. Yesterday the pair has shown a strong bearish day-candle towards the bearish phase. If the Market enters the Fibonacci lines we could expect further bearish trend movements.

GBP/CHF

Since March 2008 the GBP/CHF has been trading in a horizontal trend channel with a resistance at 2.08 and a support level at 2.00 and 1.96. Yesterday the currency pair touched the 1.96 support level again. If the Market breaks trough this level we could assume a strong downward pressure

Pivot Points - Daily FX Support and Resistance Levels

Daily Calendar & Key FX Events

Varengold Bank

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