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 mostly cautious ahead of Fed; Europe opens up higher, but late selling hits risk appetite
  • AUD/USD pushes up to 1.0300 before easing back
  • Euro slightly higher but gains remain capped by Greek worries
  • Dow up 0.1%, but S&P and Nasdaq both lower as late selling hits markets
  • Gold, crude both creep higher
  • FOMC announcement, due 4.15am, tonight’s big driver, with Operation Twist in focus

AUD/USD
The Aussie pushed a little higher than we expected yesterday, rising to 1.0300 before reversing at this level. The focus will remain to the downside with major support seen at 1.0150. Don’t forget the FOMC statement at 4.15am as anything can happen around this announcement.

GOLD
Gold made another attempt higher overnight but the precious metal was unable to break above 1810. For now, the market is likely to remain focused on the downtrend line as the best level for shorts. Tonight’s FOMC meeting could have a major impact on the gold market.

EUR/USD
The EUR/USD pushed up the weekly highs overnight before losing ground at traders are likely to remain focused on the downside. The break will be looking for trades with stops well above 1.3750.

GBP/USD
As per our last couple of reports, the GBP/USD has been dominated by the downtrend line and overnight we saw the pair push up to resistance at 1.5750 before rolling over. However, we have not seen as much follow-through as might be expected. Traders are likely to maintain shorts but a clear break above 1.5800 might change the view to bullish.

USD/JPY
The dollar-yen is now perilously close to the all-time lows at 76.00, with the interim support seen at 76.30. For now, traders are likely to continue to play the range, but any breakbelow 76.00 could see major selling. Tonight’s FOMC could be such a trigger

SILVER
Just like gold, silver is capped to the upside by the downtrend line and traders will be looking for shorting opportunities around that level. A break below 39.00 could be the next trigger lower.

USD/CHF
The dollar-Swiss has moved up to the top of the range and traders will be focused on playing the range in the near term. We’ve seen a little more activity in this market after rumours last night that the SNB was planning further intervention. A break from the range is now seen as tradable.

GBP/JPY
The sterling-yen continues to head lower with all eyes now on the all-time lows at 119.20. A break below those lows will be extremely bearish, but we might see the market vacillate around these levels.

AUD/JPY
The AUD/JPY remains in a downtrend with traders focused on the opportunities on the short side. A break of 77.75 is the next major level, but any move into resistance at 78.90 is also likely to be seen as sellable.

OIL
We are now trading the new November contract (CLX1) but the levels remain the same with support at 85.00 and resistance at 90.00. The inventories number (12.30am) and the Fed announcement (4.15am) will be the major news drivers tonight.

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