Good morning from wonderful and cold Hamburg. FOREX movements could be less than other trading days because trading volumes are lower than usual due to a Japanese public holiday today. However we hope for a good start in this week and wish you all the best in your trading.
Market review
The JPY shows a strong start at this week as market players sold higher-yielding currencies as the U.S. government agreed to protect $306 billion of loans and securities on Citigroup Inc.’s books against losses, as it seeks to shore up investor confidence in the bank and their shares fell 60% last week. With this decision the government seems to try to avoid a repeat of the chaotic aftermath of Lehman Brothers’ Sept. 15th bankruptcy. Both the AUD and the NZD, the bellwethers of the carry trades fell about 2 % against the JPY. The low-yielding Japanese currency had been widely just used as a cheap source of funds to buy higher-yielding currencies. The USD/JPY is down around 0.8% from US trade on Friday to 95.18 while the AUD/JPY trades near the 60.00 level which was already slashed earlier with a low at 59.17. The all-time low at 55.11 hit in October is not as far away. The NZD/JPY is also down to 50.86 after touching its day-high at 51.73. The EUR/JPY is also little down to 120.26 from 120.71. The EUR/USD climbed to 1.2611 from 1.2587 while the GBP/USD trades currently at 1.4920 back from its day-low at 1.4839.
NZD/USD
Since the end of September the NZD/USD has been trading in Fibonacci retracement lines. After touching the 50% retracement and going through the 0.54 support line, the market returned and trades currently close to the 0.54 resistance. If the market cross this level it could start a bullish trend on the way toward the upper retracement levels.
AUD/USD
During the past two months the AUD has shown a lot of losses against the USD. Since the beginning of November the market has been trading very close to the bearish trend line and trades now below the 0.64 resistance level. If the market breaks through the resistance and the bearish trend line it could start a new bullish trend.
