The Forex Market Insight Report shows charts on different major currencies and commodities, with brief commentaries on how new data releases and news cause movements in the market.

Headline:

  • Risk appetite wanes further as Bernanke winds back stimulus expectations
  • USD declines after S&P becomes second rating agency to put US debt on credit watch
  • EUR reverses after two-day mega move
  • Dow losses ground throughout the day to close down 0.4%
  • Overnight data from US beats expectations, with jobs, retail sales PPI all stronger than expected
  • US CPI tonight the big item on the today’s agenda

AUD/USD
The market will still be looking for shorts on the AAD/USD, until at least we see a clear break above 1.0800. Targets for shorts will be back to 1.0700. A break of 1.0800 sets up a move to 1.1000.

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XAU/USD
Gold remains trapped between 1575 and 1590, but the market is obviously bullish toward this instrument. Traders will be looking for a pullback to 1575 and look to play the range, while more cautious traders will be waiting for confirmation of a break above 1590.

EUR/USD
The Euro is still defined by this extremely large trading band, between 1.3960 and 1.4300, which illustrates the high volatility currently on this pair. Traders will still be looking for shorts up around 1.4250 to 1.4300. Don’t forget tonight’s Eurozone bank stress tests will be extremely high impact.

GBP/USD
As per yesterday, the recent break of 1.6100 has been bullish with traders using any moves back to 1.6100 as an opportunity to take new longs. That said, a break below 1.6100 could be seen as bearish.

USD/JPY
The USD/JPY remains in a strong downtrend and traders will be looking for new opportunities on the short side. Any move back to key resistance at 79.60 could see the sellers remerge with targets back to 78.50.

SILVER
Silver has found some resistance up at 39.50 and we could see a pause in this market in the near term. A move back towards 37.00 brings silver back to value and traders could be looking for new longs around this level.

USD/CHF
The USD/CHF remains trapped in the trading range, with traders waiting for a move back to the top of the range in order to take new shorts. A break of 80.80 is also bearish.

GBP/JPY
The GBP/JPY has rejected higher levels and the market will see this as confirmation that the downtrend will continue. The market could now well resume its move lower with initial targets toward 125.30.
AUD/JPY
No real change on the AUD/JPY with the pair still broadly capped by the trading range with support at 84.00 and resistance at 85.00. Traders will either continue to play the range or wait for a break in either direction.

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OIL
Like many other instruments, the trading range on crude has blown out as a result of higher volatility. While the picture is mixed, the odds favour the bulls after crude rejected lower levels. A move back to 99 would see the sellers re-emerge,
however.
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