US Session: Risk Aversion Masks Recovery as Overnight Trading and Durable Goods Disappoint Investors – Jul 29, 2009
Jul 29, 2009 Make Money Online
Market Brief
The dollar rallied against a basket of currencies today as a risk-averse investor sentiment continued to flourish in financial markets. The EurUsd fell 97pips testing 1.406 as a point of resistance, while the UsdJpy gained nearly .54pips to find support at 95.00. In the U.K. the GbpUsd continues depreciating below 1.64. Equity markets were mixed in the U.S. and Europe with the Dow lower by .63% or 57.51pts and the FTSE up by .73% or 32.9pts. The yield curve continued its downward trend with 10 and 30 year bond yields lower by .63 and .6.
The economic recovery story was veiled today as the dollar rallied on the back of weaker Asian equities and projections from economists that U.S. durable goods orders had fallen. The U.S. Commerce Department reported that orders for durable goods were -2.5% versus -.6% expected; likely due to the recent shutdown of domestic auto plants. In Japan, desire for safe haven investments drove up the yen against most majors as retail sales dropped more-than-expected to 3.0% versus a 2.8% consensus. The dollar index was up to a high of 79.60 and the yen moved .62% higher, surpassing 95. In the eurozone, German CPI in July CPI came out twice as bad at -.6 y/y versus -.3 y/y; marking the first negative reading in 23 years. News of the data’s negative pace supported a flight to safety as investors sold off the high yielding Euro. Housing data in the U.K. was mixed with June mortgage approvals at 47,600, beating analyst’s expectations of 47,000; however net lending to consumers fell £.2bln to £.1bln versus £.3bln expected. After reaching a 10 month high yesterday, the Cad slowed its pace and traded sideways versus the dollar. New Zealand’s NBNZ Business Confidence rose 18.7 in July, the highest since February 2002. On the commodities front, NYMEX crude for September delivery fell 4% to $64.50bbl in light of yesterday’s comments from the CFTC on excessive speculation and a recent report that crude supply exceeded expectations by four million barrels. The Canadian statistics agency will release data on raw materials prices tomorrow.
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Currency Tech
AUDUSD
R 2: 0.8520
R 1: 0.8379
CURRENT: 0.8215
S 1: 0.8090
S 2: 0.7925
USDCAD
R 2: 1.1225
R 1: 1.1010
CURRENT: 1.0848
S 1: 1.0545
S 2: 1.0440
EURJPY
R 2: 136.90
R 1: 136.10
CURRENT: 133.70
S 1: 132.10
S 2: 131.60
USDMXN
R 2: 13.645
R 1: 13.415
CURRENT: 13.243
S 1: 13.135
S 2: 13.060
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Tags: CPI, Dollar index, Dow Jones, Economics, Forex, GBP, Housing data, investor, USD
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