Jim Devonport
Compass Global Markets
COMPASS DAILY CURRENCY MARKET REPORT 27TH NOVEMBER 2014
The market in brief:
• AUD dips get bought into
• NZD 60 points higher on the day
• Australian Construction Work drops sharply
• UK GDP flat
• US Durable Goods disappoint
• US Weekly Unemployment Claims higher
• US New Home Sales lower
Market moving events for the next 24 hours:
• NZ Trade Balance
• Australian Private capital Expenditure
• German Inflation
• Spanish House Price Index
AUDUSD:
The Australian Dollar took a shallow dip yesterday as the negative sentiment prevailed, however weaker than expected US data soon saw the table reversed and the losses erased. The AUD opens flat this morning and with only the Private CAPEX data due we do not foresee any great shakes. As mentioned yesterday, tomorrows US public holiday will cap any moves and the technical picture supports that view. The current levels are the 50% Fibonacci retracement of the rally from 60c to 1.11 and the daily candlestick has formed a “hanging man” signalling exhaustion. We favour sideways trading until next week’s RBA meeting at least.
AUDEUR:
The Euro has maintained its upward move on this cross, but most of the Asian session sell off has been reversed overnight. German inflation data is due this evening and expected to create some volatility as the market looks to see when and by how much they will add to their monetary stimulus. Resistance is also strong here and the daily candlestick also showing signs of rejecting these lows. Sideways till next week.
AUDGBP:
UK GDP printed at a steady 0.7% for the quarter, as we had expected. This has nonetheless taken the cross lower to levels last seen at the start of the month. There is no further data set to come this week so with the pair looking likely to bottom; we’d favour a recovery of sorts over the next 48 hours.
AUDJPY:
A flat close for this pair as northern hemisphere traders bought into a secondary dip during our time zone. There are a string of secondary tier economic data releases due tomorrow, however focus is on the elections and the technical picture that should see any dips continued to be taken advantage of by exporters.
AUDNZD:
The Tasman Cross had another test of the lows yesterday, levels last seen 4 months ago. NZ Trade Balance data fresh off the press has seen a deficit of -908 million, versus an expected -645 and a prior -1.367 billion. Initial price action therefore has the pair recovering slightly. The long term upward channel sits 120 points below and may be tested, but we favour it holding.
Thought for today: “Knowledge speaks but wisdom listens” Jimi Hendrix. Born this day 1942, (Died Sept 18 1970).
Alternative Currency Hedging: Ask us about a great alternative to traditional forward contracts that give the ability to cover at attractive levels, but with the flexibility to walk away if the rate improves or if not required.
Referrals: Client referrals are very important to our business. If you know of any contacts that can benefit from our comprehensive range of international currency transfer services, please do not hesitate to contact me. I’d be glad to assist.
Jim Devonport
The market in brief:
• AUD dips get bought into
• NZD 60 points higher on the day
• Australian Construction Work drops sharply
• UK GDP flat
• US Durable Goods disappoint
• US Weekly Unemployment Claims higher
• US New Home Sales lower
Market moving events for the next 24 hours:
• NZ Trade Balance
• Australian Private capital Expenditure
• German Inflation
• Spanish House Price Index
AUDUSD:
The Australian Dollar took a shallow dip yesterday as the negative sentiment prevailed, however weaker than expected US data soon saw the table reversed and the losses erased. The AUD opens flat this morning and with only the Private CAPEX data due we do not foresee any great shakes. As mentioned yesterday, tomorrows US public holiday will cap any moves and the technical picture supports that view. The current levels are the 50% Fibonacci retracement of the rally from 60c to 1.11 and the daily candlestick has formed a “hanging man” signalling exhaustion. We favour sideways trading until next week’s RBA meeting at least.
AUDEUR:
The Euro has maintained its upward move on this cross, but most of the Asian session sell off has been reversed overnight. German inflation data is due this evening and expected to create some volatility as the market looks to see when and by how much they will add to their monetary stimulus. Resistance is also strong here and the daily candlestick also showing signs of rejecting these lows. Sideways till next week.
AUDGBP:
UK GDP printed at a steady 0.7% for the quarter, as we had expected. This has nonetheless taken the cross lower to levels last seen at the start of the month. There is no further data set to come this week so with the pair looking likely to bottom; we’d favour a recovery of sorts over the next 48 hours.
AUDJPY:
A flat close for this pair as northern hemisphere traders bought into a secondary dip during our time zone. There are a string of secondary tier economic data releases due tomorrow, however focus is on the elections and the technical picture that should see any dips continued to be taken advantage of by exporters.
AUDNZD:
The Tasman Cross had another test of the lows yesterday, levels last seen 4 months ago. NZ Trade Balance data fresh off the press has seen a deficit of -908 million, versus an expected -645 and a prior -1.367 billion. Initial price action therefore has the pair recovering slightly. The long term upward channel sits 120 points below and may be tested, but we favour it holding.
Thought for today: “Knowledge speaks but wisdom listens” Jimi Hendrix. Born this day 1942, (Died Sept 18 1970).
Alternative Currency Hedging: Ask us about a great alternative to traditional forward contracts that give the ability to cover at attractive levels, but with the flexibility to walk away if the rate improves or if not required.
Referrals: Client referrals are very important to our business. If you know of any contacts that can benefit from our comprehensive range of international currency transfer services, please do not hesitate to contact me. I’d be glad to assist.
Jim Devonport
Corporate & High Net Worth Client Manager
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