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:

  • AUD breaks through to record highs as investors flock to the high yielding AUD and commodities consolidate.
  • US Treasury secretary confirms the US “strong dollar policy” however the market ignores this and continues to sell USD across the board while the QE program continues. Bernanke speaks later this evening and this could be a signal as to the intentions of the US going forward and possible cut-back of the QE program.
  • US treasury yields stay at record lows as traders consider no change in sight to the low interest rate environment in the US causing further USD losses.
  • EUR continued higher against all the major currencies as inflation concerns continue in the Eurozone
  • US equity markets close higher on strong earnings at with the Dow +0.93, S&P +0.90 and Nasdaq +0.77

AUD/USD
AUD now trading at record highs as the high yield and negativity surrounding the USD continues to attract invest,ent funds into AUD. The breaking higher through to levels above 1.0800 is a quite bullish signal and traders continue to call it higher towards 1.1000 sooner rather than later. CPI released at 11.30AEST is sure to provide plenty of fireworks.

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XAU/USD
Gold drifted lower over the holiday break but found solid support at the up-trend line around 1490/95. The bounce from this level has confirmed the uptrend and traders are content trading gold from the long (buy) side for the time being unless we break back through 1490.00 targeting a fresh push towards 1520/30 in the coming days.

EUR/USD
Support and resistance is so important in forex markets and yet again the EUR found solid support at previous resistance around 1.4500 before bouncing more than 200 to the topside as traders continue to price in further rate rises in Europe. From here traders are still content playing it from the long side so long as we stay above 1.4640/50.

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GBP/USD
GBP again is grinding higher but fairly subdued as traders prefer the higher yielding EUR. For the technical traders GBP looks like a bull flag at the moment and traders are happy trading it from the long side either buying the dip or buying the break of 1.6520 looking it to eventually break through above 1.6600 in the coming sessions.

USD/JPY
The downward trend continues in the USD/JPY as traders continued to show negativity towards the USD. The sell-off has been gradual and traders are still content to sell rallies back towards 81.80/90 region looking for 81.00 in the coming sessions. Only a break back above 82.00 could generate bullish signals in the short term, however keep an eye on Bernanke’s speech.

AUD/JPY
AUD/JPY continues to consolidate as the gains the AUD/JPY are offset by the losses in the USD/JPY and traders seem content to continue to trade the range for the time being however most are cautious of a break topside through the resistance around 88.50 should there be a strong CPI number this morning.

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OIL
Oil reached the previous highs of 113.00 as traders continued to buy Oil as Libyan forces bombed a major shipping port. For the moment traders continue to be bullish but respecting the resistance of 113.00 and looking to buy the dip or the break. Oil inventories out of the US later this evening should give an indication of the next move

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