Market Brief
The Japanese economy contracted a record 4% (-15.2% Annualized rate) in the first quarter but was largely in-line with expectations, the Yen failed to move substantially – testament to the fact that this sharp decline in GDP was already priced into the markets. Japan’s GDP followed suit to what Europe had reported last week as slowing global demand for its products has hurt exports – a major contributor to the Nippon economy. There has been much talk of intervention on the part of the BoJ as Japanese exporters continue to suffer the consequences of a strong Yen. The global crisis brought on a contraction in interest rates which eroded the Yen carry-trade starting mid-last year and focused the Yen as a haven currency – its dynamic defying that of the Greenbacks. This dynamic was thawing in recent weeks but with increased risk aversion in the markets we seek a general strengthening of the Yen across the board.
The US dollar was initially under pressure after the NY close however after reaching a high of 1.3668 the greenback fought back, trading as low as 1.3585 in mid-Asian session where it hit a support. The USDJPY traded lower throughout the night as the Yen simply shrugged off the bad GDP news as consumer confidence and external demand showed signs of stabilization. The USDJPY traded as low as 95.53 in Asian trading, where it retraced 20pips higher but the strong bearish trend remains.
| Global Indexes | Current Level | % Change |
| Nikkei 225 Index | 9330.46 | 0.43 |
| Hang Seng Index | 17547.61 | 0.02 |
| Shanghai Index | 2673.208 | -0.13 |
| FTSE futures | 4440.5 | 0.64 |
| DAX futures | 4949 | 2.12 |
| DJIA futures | 8432 | -0.2 |
| Nasdaq futures | 1389 | -0.36 |
| World Markets | Current Level | % Change |
| Gold | 925.7 | 0.07 |
| Silver | 14.11 | -0.49 |
| VIX | 28.8 | -4.76 |
| Crude wti | 60.5 | 0.67 |
| USD Index | 82.16 | 0.08 |
| Todays Calender | Estimates | Previous | Country / GMT |
| BoE Minutes | - | - | GBP / 08:30 |
| Swiss Zew | - | - | CHF / 09:00 |
| CAD CPI (MoM) | 0.20% | 0.20% | CAD / 11:00 |
| CAD CPI (YoY) | 1.80% | 2.00% | CAD / 11:00 |
| Tarp Senate Hearing | - | - | USD / 13:30 |
| FOMC Meeting | - | - | USD / 18:00 |
Currency Tech
AUDUSD
R 3: 0.7785
R 2: 0.7757
R 1: 0.7719
CURRENT: 0.7712
S 1: 0.7687
S 2: 0.7559
S 3: 0.7451
EURJPY
R 3: 133.59
R 2: 132.40
R 1: 131.15
CURRENT: 130.03
S 1: 126.63
S 2: 124.39
S 3: 122.13
USDSGD
R 3: 1.4882
R 2: 1.4845
R 1: 1.4803
CURRENT: 1.4643
S 1: 1.4623
S 2: 1.4501
S 3: 1.4446
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S: Strong, M: Minor, T: Trendline, K: Keylevel, P: Pivot
