Concerns about the European economy increased after a report showed that manufacturing depreciated in the euro zone and also the probability for further rate cut announcements by the ECB rose. In case of a further lowering, the interest rate might be fixed 25 basis points below the current rate of 0.75 percent.
Yesterday, the ADP Research Institute confirmed that U.S. companies added 119,000 employees in April, the lowest since September. Referring to a separate gauge of economists by Bloomberg, the Labor Department might publish an unchanged unemployment rate of 7.6 percent this month; although nonfarm payrolls climbed by 145,000 following a gain of 88,000 in March. Furthermore, also the Federal Reserve announced that they will continue the current easing measures including the 85 billion USD asset purchasing program. In addition, the central bank emphasized that a modification of the amount could be done if this is required by the U.S. business. Tomorrow releasing data might also show that factory orders dropped by 3 percent in March compared to February, which would be the highest fall since August.
In addition, the China PMI by HSBC tumbled to 50.4 in April, undermining the economists' forecast of 50.5, which is a sign for a slowdown in the country's manufacturing industry. As a result, the JPY advanced against most of its currency counterparts. The AUD decreased 0.3 percent to 99.80 JPY, while the NZD lost 0.2 percent to 82.62 versus the JPY. Besides the South Pacific currencies, the USD depreciated 0.1 percent against the JPY and traded at 97.33, after having touched 97.01 on the 30th of April, the lowest since the 16th of April. The EUR fell like the USD 0.1 percent to 128.30 JPY, but the EUR/USD kept its level at 1.3180 unchanged. Also tonight released data of the Bank of Japan confirmed a 23 percent jump of the nation's monetary base by 23 percent in April.
Technical analysis
USD/JPY (Daily)
The USD/JPY bullish movement started at the support line around 77.66 on the 2nd of September 2012 and has been gaining inside a bullish Andrew's pitchfork, but has been stopped twice at the resistance level 99.46. Currently, it is weakening down towards the support level around 96.57. Although Momentum and CCI are still assuming losses for the pair, we still might be confident that the closest well known level might be able to keep the rate up
Support Levels around. Resistance Levels around
96.57. 99.46
93.24. N/A
88.44. N/A
GBP/USD (4 Hours)
On the 22nd of April, the bulls took control of the GBP/USD and boosted it rapidly up above a Fibonacci fan. But the resistance level around 1.5592 proved to be too strong and in succession the rate dropped to the support around 1.5538 as well as the middle Bollinger band. Meanwhile, the MACD remains high-leveled, while the Stochastic assumes losses. Therefore a sideways movement might be follow between these two levels
Support Levels around. Resistance Levels around
1.5538. 1.5592
1.5480. N/A
1.5231. N/A
EUR/AUD (4 Hours)
From the support level around 1.2389, the EUR has been rising against the AUD above a bullish Fibonacci fan since the mid-April. Then the rate traded into a sideways movement for two weeks, before experiencing demand at the levels around 1.2623 and 1.2704. Currently, we see the pair increasing, while the DeMarker is still in its overbought market zone and also the OsMA remaining high-leveled, which might be a first sign of weakening
Support Levels around. Resistance Levels around
1.2704. N/A
1.2623. N/A
1.2389. N/A
IMOH, Clement I.
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