GBP/USD: key support at 1.5200

Good morning from Hamburg and welcome to our Daily FX Report. Once again, in a few days the market will fix its eyes toward Cupertino, to the expected launch of Apple's smartwatch on March 9, and the apps that will take it useful. For those who still believe this new Apple’s product will not be successful just remember one example: When Apple launched the first iPad, many said it was just a big iPod Touch and would not take off. Now the IPad is an excellent tool used by so many customers around the world, not only for fun but for business and education. Considering the huge amount of Apple fans, it will only take a small percentage of them to buy a smartwatch to create massive sales numbers which increase notably the firm’s revenues.

Anyway, we wish you a successful trading day!

Market Review – Fundamental Perspective

The euro dropped to the weakest level since 2003 as reports showed Europe’s economic growth diverging from the U.S., as the European Central Bank prepares to add monetarist stimulus through bond purchases. The shared currency fell for a fifth day, sliding almost 1% to $1.1078, and reached $1.1062, the lowest level since September 2003. Regarding the data released yesterday, services growth in the euro area fell short of analysts’ estimates last month, while U.S. services business expanded, and American companies added more than 200.000 jobs for a 13th straight month. Most of the U.S. economy continue to expand during 2015, with the consumer spending rising and manufacturing gaining. The New Zealand dollar had a very good trading day and headed higher against the U.S. dollar, to reach 0.7608. The Australian Dollar also dropped against the Kiwi, breaking down 1.0300 and reaching a low of 1.0296, with parity at some stage looking more or less inevitable, especially if, how it seems, the RBA finally decides a rate cut in its next meeting. On the other hand, the Canadian dollar rose against most of its major pairs after the Bank of Canada held its policy rate unchanged in one of the most closely watched meetings since the financial crisis, citing indications the economy weathering the plunge on crude oil prices. The Canadian currency strengthened 0.6% to 1.2427 per U.S. dollar. Regarding the yen, the Japanese currency was little changed at 119.69 per dollar. It closed at a three week high on February 4th, a day after the 10 year auction tail extended to levels unseen since July 2003. The tail is the different between the lowest and the average price. The longer it is, the more bids are disperse around the average price.

Daily Technical Analysis

NZDUSD (Daily)

Technically the NZDUSD has been bouncing in the last weeks and now it is in an important point, as the pair is trying to break the long term downtrend, initiated in July 2014. However, if this resistance is crossed, the pair will have to fight soon with another resistance placed around 0.7650, which also looks pretty strong. If this levels are not finally crossed, at least at first, we identify two close supports at 0.7475 and 0.7325, even though, in this occasion none of them look especially significant.

Support & Resistance (Daily)