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Global recovery concerns continue to weaken markets
August 12, 2010
Currency Tech
EURUSD
R 2: 1.3250
R 1: 1.3000
CURRENT: 1.2886
S 1: 1.2800
S 2: 1.2680
USDJPY
R 2: 87.20
R 1: 86.80
CURRENT: 85.38
S 1: 85.00
S 2: 84.50
GBPUSD
R 2: 1.5980
R 1: 1.5800
CURRENT: 1.5695
S 1: 1.5575
S 2: 1.5480
AUDUSD
R 2: 0.9200
R 1: 0.9070
CURRENT: 0.8963
S 1: 0.8925
S 2: 0.8810
Market Brief
The JPY gained toward a 15-year high against the USD and strengthened for a third day versus the EUR as concern the global economic recovery is faltering spurred demand for the safest assets. Japan’s currency rose versus 15 of its 16 major counterparts as Industrial output in the EU probably grew 0.6% (prev. 1%) according to data to be released today and the US trade deficit expanded by a record $7.9 billion in June. The Yuan weakened after the PBOC today lowered its daily reference rate by 0.36% to 6.8015, the steepest drop since the USD peg was scrapped in July 2005, industrial output gained 13.4% YoY, the smallest gain in 11 months and bank lending rose by the least since March. The USDJPY dropped to 85.11, EURJPY dropped to 109.65 after earlier reaching 109.24, the lowest level since July 6, GBPUSD fell for a third day, weakening 1.2% to 1.5664 and EURUSD traded at 1.2887. The MSCI Asia Pacific Index lost 1.5%, declining for a fourth day, MSCI’s World Index and the S&P 500 Index both tumbled 2.8% yesterday.
New Zealand’s dollar declined after the manufacturing index fell to 49.9 falling below the 50 level thresholds since August 2009. AUDUSD slid for a fourth day after the jobless rate advanced to 5.3% (prev. 5.1%) and jobless claims rose to 23,500 more than the expected 20,000 indicating risk aversion and a growing bearish sentiment which could drive both the NZD and AUD lower. The AUDUSD dropped 0.3% to 0.8944 while AUDJPY sliding 0.6% to 76.10 and NZDUSD lost 0.4% to 0.7121 and NZDJPY retreated 0.6% to 60.59.
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