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:

  • US sharemarket strengthens for third straight day as risk appetite returns
  • EUR sees gains after upbeat commentary from EU on Greece, Italy; Greek confidence vote tonight
  • Aussie stages strong bounce from 1.0500
  • Commodities post gains, with oil and gold both higher
  • US gains came after losses in Europe, with Dow up 0.6% overnight
  • RBA minutes, out at 11.30am, says no urgency to hike rates

AUD/USD
Still no clear change in market sentiment towards the Aussie, with the pair respecting the range with support at 1.0480/500 and resistance at 1.0640. A clear break of 1.0680 will be bullish and, overall, the weight of evidence lies in favour of the bullish case. We’re likely to see some weakness early today after the RBA minutes suggested “no urgency to rate hikes”.


XAU/USD
Gold continues to trade in this upward sloping channel and overnight the buyers pushed the precious metal up to the top of the range. Traders expect the market to remain in this range in the lead-up to the US’s interest rate decision on Thursday morning.
EUR/USD
The Euro saw another bout of buying overnight and this has shifted the pair into a short-term uptrend. The move above 1.4320 is bullish and sets up a move to 1.4450. Overall, however, the market sentiment remains fairly bearish, and traders will be looking for reversal signals and will not be over-committing to longs.

GBP/USD
The GBPUSD produced a mild bounce in overnight trade but any further gains appear to be capped around 1.6230/50. The GBP has been dominated by selling pressure as inflation fears become less acute. Traders will be looking for selling opportunities around 1.6230/50.

USD/JPY
There’s not much happening on the dollar-yen for now, with even yesterday’s poor Japanese export figures having no real impact on prices. The support at 80 remains the line in the sand, with additional support seen between 79.60 and 79.70

SILVER
Silver is at the crossroads at the moment, with the metal hovering just below important resistance at 36.00. The rising support at the lower end of this triangle pattern indicates that a break to the upside is imminent and any move above 36.00 will be seen as a buying opportunity. Until we see this break, however, this picture remains bearish.
USD/CHF
No real change on the dollar-Swiss with the pair still finding resistance at 85.50 and support seen at 84.50. Traders will be waiting for any opportunity to get short on this pair, with a move back to 85.50, or a break of 84.50, seen as the best opportunities
GBP/JPY
The GBP/JPY saw a retracement higher in overnight trade bring the pair back to resistance at 130.40. We might see further carry through higher in Asian trade but, overall, traders are still looking for opportunities to take new short positions. We have a big bight of data on this pair, with Japanese growth data at 2.30pm and UK public sector borrowing data at 6.30pm.


AUD/JPY
The Aussie-yen tried to break lower in yesterday’s Asian session but found buyers at the final layer of support (at the three month lows at 84.30). This means the descending triangle remains in place and there is an expectation in the market that the AUD/JPY will now move to the top of the range at 86.30. A break of 84.30 changes the picture to bearish.
OIL
Oil bounced strongly from the lows under $92 as a return of risk appetite boosted the commodity space. This move has brought oil back to resistance and traders will be looking to sell again around $94. A clear break above $94.00/20 would be
seen as more bullish.
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