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:

  • Markets finish last week on slightly positive note, despite weaker US economic data
  • EUR, GBP ease lower into weekly close
  • AUD sharply lower on Friday after Westpac first bank to say RBA might cut rates
  • Dow sees late rally to close 0.3% higher, Nasdaq gains 1.0%
  • Risk currencies gap lower on Monday open
  • This week’s big driver likely to be US debt ceiling discussions with 22 July deadline looming

AUD/USD
The Aussie was hit on Friday night after Westpac came out as the first bank to downgrade expectations for further interest rate increases. This news led the AUD/USD below previous support at 1.0695 and support now moves lower to 1.0620. A break of support at 1.0620 sets up a move back to 1.0500.

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XAU/USD
Gold has popped higher on Monday morning’s open but failed just shy of 1600. This level will be of crucial importance and traders will be waiting for a break of that level to participate in the next move higher. Looking lower, support is seen at 1575 (at the previous all-time highs) and traders will also be looking to pick up new longs at these levels.

EUR/USD
The Euro has failed at the underside of the multi-week symmetrical triangle and this set up the EUR/USD for further falls. The Euro gapped lower this morning, so traders will be looking to take new shorts on any signs of strength. The next level for support is seen at 1.3960 and then at 1.3840.

GBP/USD
The pound’s inability to push above 1.6200 now present a more bearish picture and the downbeat tone of early Monday trading also suggests that the pound might face pressure early this week. In the near term, a break of 1.6075 will produce further selling with the potential for a move back to 1.5950.

USD/JPY
The USD/JPY remains trapped in its broad new trading range below 79.60. Any move back into the 79.30/60 zone is likely to attract new sellers. A clear move below 78.50 could cause the Bank of Japan to intervene in currency markets so any move lower will see traders become more cautious of upside risks.

SILVER
Silver saw some slight selling pressure toward the end of last week, but it’s managed to bounce from higher support levels and is now moving back toward the recent highs at 39.40. With gold surging higher in recent weeks this has helped silver also post gains. A break of 39.40 will be seen as bullish.

USD/CHF
The USD/CHF continues to trade at lower levels and the fear surrounding the US’s debt negotiations continues to grow. The market remains focused on the downside on this pair, with any move up to 82.00, or a break below 80.80, seen as an
opportunity for new shorts.

GBP/JPY
No real change on the GBP/JPY, with the pair struggling at resistance at 128.20. While the pair remains under 128.20, the market is likely to focus on the downside. Over the medium term, any move lower is likely to target 125.30.

AUD/JPY
The AUD/JPY has been driven below support at 84.20 on the back of Westpac’s downgrade of local interest rate expectations. The next major level to the downside is 83.20 with and breach of that level likely to be seen as extremely bearish for this pair.

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OIL
Crude oil remains trapped in the middle of the larger trading range and trader will be waiting for a move to either extreme before taking new positions. With global markets starting the week on a downbeat note, a break of 94.00 will be seen a
bearish
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Read more Australian Dollar News from our Forex Education section.