Daily FX Report

The USD hit a one month high against the JPY this morning

Thu, Jul 24 2008, 07:24 GMT
by Varengold Bank Research Team

Varengold Wertpapierhandelsbank AG


Good morning from wonderful Hamburg and welcome to Varengold Bank’s Daily FX Report. The weather looks great in Hamburg and hopefully the summer will come back with some warm summer days. Some interesting business data will come out today in the Euro zone that could move the markets, which is a good sign for an exciting trading session with very good market opportunities.

Market review

The USD hit a one month high against the JPY this morning, caused by the drop in oil prices and signs of improved confidence in the US financial sector on Wednesday. The month high in USD/JPY was set at 107.99. Oil extended its losses yesterday to fall more than 20 USD from all time high above 147 USD, while US financial shares rose after President Bush dropped a threat to veto a housing rescue bill. The USD was also supported by the comments from Philly Fed President Plosser we wrote about yesterday. The EUR/USD was little changed at 1.5681 this morning. The CAD fell to its lowest close in two weeks against USD and closed at 1.0103.

The Reserve Bank of New Zealand cut its cash rate by a quarter percentage point to 8 %, in its first interest rate cut in five years and said further reductions were likely to counter a rapidly slowing economy. The NZD/USD stood at 0.7444, having fallen from around 0.7500 following the rate decision.

GBP/CHF

The GBP/CHF broke through its strong resistance around 2.06 a second time. The long term sideways trend has existed since May. After the newest break, the market could go on with its bullish trend. If the market returns to the channel again, it could come back to its support around 2.02.

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USD/JPY

In USD/JPY the market took a second attempt to try to break through its resistance around 108.50. Since then, the market recovered to its very strong support at 105.5. The second try to break 108.50 could be a sign for continuing the long term upward trend. Otherwise, the market could come back to its support again.

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Published on  Thu, Jul 24 2008, 07:36 GMT

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