Good morning from beautiful and cold Hamburg. The week was embossed by speculations about the rate decision of the ECB. Yesterday it was finally announced without any surprises. We wish you a prosperous trading day and a nice weekend.
Market review
The ECB reduced its key interest rate by 50bps to 2.0 % and its President, Jean-Claude Trichet, signaled that the ECB is prepared for further rate cuts. The EUR/USD traded near its lowest level in more than one month at 1.3026 from its opening at 1.3191. The EUR/JPY, unimpressed of the rate cut, rose to 118.65 yesterday and climbed to 119.58 at early Tokyo trading on Friday. Crucial were speculations that stock gains and measures to stabilize the U.S. financial system will encourage investors to buy higher-yielding assets which funded in JPY.
Yesterday the USD/JPY rose 1.10 % to 90.03 at its high after U.S. Senate voted to release the second half of the $700bln financial rescue package. Nevertheless the U.S. first-time claims for jobless insurance climbed broader and signaled no turnaround at the job-market. As well the USD/CAD extended its gains for a fifth consecutive day and rose to a multi-week high at 1.2675.
Yesterday the AUD/USD touched a five-week low at 0.6538 as a government report showed that Australia’s unemployment increased to the highest level in almost two years. The 5.3 % weekly decline was the biggest since October 2008.
GBP/CHF
Since the middle of October, the GBP/CHF has been trading in a bearish trend-line between the middle and lowest Bollinger Bands. After the currency pair had been recovered since the 31st of December, it seems that the bear is back. If the support at 1.6190 will breach it could boost the downward trend. Otherwise if the pair will cross the middle Bands, there is a chance to test the resistance at 1.7410.
AUD/NZD
Since November 2008, the AUD/NZD has been trading in a bullish trend-channel and tested its resistance at 1.2363 yesterday. Now it seems that the currency pair stabilized curtly below the resistance. If the trend-channel remains intact it will retest its resistance. Should the AUD/NZD sustainable cross its resistance it could boost the bullish trend. The MACD shows good odds to continue the upward trend.
