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:

  • Chinese drive late rally on hopes of Italian investment
  • Dow rallies 300 points from lows; risk instruments also higher
  • Gold, silver see losses, but crude pushed higher
  • EUR/USD, GBP/USD both rally on Chinese plans to buy Italian debt
  • Aussie also sees late rally, but resistance remains at 1.0400
  • Economic data remains slow with NAB Business Confidence at 11.30am and UK CPI at 6.30pm

AUD/USD
The AUD/USD looks to be under bearish pressure and the overnight bounce is likely to be seen as another selling opportunity. Major resistance looks to be between 1.0400 and 1.0440 and traders will be using these levels to initiate new shorts.

XAU/USD
Gold now looks trapped by the downtrend line near 1860 and on the downside we can see support at 1800. Gold is looking increasingly bearish with any break below 1800 likely to trigger more selling
EUR/USD
The EUR/USD has seen a small bounce on hopes that the Chinese government is considering buying Italian bonds, but traders will remain focused on the downside. Resistance is seen above 1.3700 and traders will be waiting for the next opportunity to get short

GBP/USD
The GBP/USD remains trapped in a trading range and traders will be focused on this zone in the near term. A move back to 1.5920 will be seen as a selling opportunity while a break below 1.5770 will also be used for shorts.

USD/JPY
The USD/JPY continues to struggle higher with yesterday’s pullback to rising support seen as another sign that this pair could be reversing out of its downtrend. The market will continue to watch for a clean break above 77.85 to trigger long positions.

SILVER
Silver broke below the triangle we identified in yesterday’s report and, like gold, this presents a more bearish picture. A break below 40.00 is likely to be seen as the trigger for new shorts.

USD/CHF
The USD/CHF continues to grind higher but we are yet to get a clear sign of continuation on this pair. For the moment, traders are likely to be more cautious towards this pair and look for currencies not in the midst of manipulation.

GBP/JPY
Traders using the 123.0/20 as the sellzone should have picked up some profits over the last 24 hours and the market will continue to use this trading band as the major focus in the near term. Traders are likely to remain focused on the downside in the near term.

AUD/JPY
The AUD/JPY’s break below 80.50 trigged selling yesterday and saw the down move terminated down at 79.00. Since then, we’ve seen a bounce higher, but traders will be now looking for new short positions.

OIL
Oil’s pushed back to resistance at 89.00 and traders will be looking for new shorts until we see a clear break above 90.00. Further bearishness towards the global economy should translate into a weaker oil price.

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