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:

  • EU plan sees risk instruments surge as major markets break into uptrends
  • Plan ends Euro concerns for the near term; likely to be seen as major turning point
  • Dow up 340 points as it closes in on best month since January 1987
  • Aussie, Euro stage massive move higher as investors rebalance longer term portfolios
  • Gold, silver push higher in bullish medium-term signs, copper explodes to the upside
  • With no major data, look to see how markets support pullbacks

AUD/USD
The EU plan has potentially stamped a bottom on risk assets and traders will be focused only the long side for the moment. Any pullbacks are likely to be bought with 1.0620 to 1.6405 seen as the potential support zone.

GOLD
Gold has benefited in line with risk assets overnight and this suggests we might see gold continue higher in the near term. Either a new break higher or a pullback to support near 1730 or 1710 will be seen as buyable.

EUR/USD
The Euro has obviously been one of the main beneficiaries from the overnight action but we can see a little bit of caution creeping into the market as we start the Asian session. Traders will be looking to buy pullbacks in this market.

GBP/USD
The pound‟s break above 1.6040 saw a 110-point move that was dwarfed by most other markets, suggesting that GBP/USD traders aren‟t quite as bullish. Regardless, the bias will remain to the long side with support seen in a wide band between 1.5980 and 1.6040.

USD/JPY
Yawn. The dollar-yen didn‟t even rouse itself for the biggest session of the year. Instead, it continues to trade perfectly within the flag pattern we have identified over the last few days. Traders will continue to play the range.

SILVER
Silver has now broken higher suggesting we might see gains regardless of the „fear trade‟ that has been so beneficial to the precious metals space. After such a strong move higher, it‟s always tricky judging the next level to buy, so traders will be waiting for a pullback before taking new highs.

USD/CHF
The break of 0.8740 we identified yesterday certainly was the trigger for shorts with the pair losing more than 200 pips after falling from this level. Traders are likely to wait for a retracement higher before looking for new shorts.

GBP/JPY
Like cable, we saw the sterling-yen refrain from participating to the full extent of the overnight rally. This is also likely to inject some caution into this market, but some buying will be using 122.00 as support.

AUD/JPY
The Aussie-yen surged higher on the break of 80.00 and this now confirms a trend reversal on the AUD/JPY. Traders will be looking to use a pullback, particularly back toward 80.00, as the next chance for longs.

OIL
Crude‟s bounced from 90.00 quite markedly and traders will be waiting for a break of resistance for their next chance at longs. A pullback to 90 is also likely to be bought.