Good morning from beautiful Hamburg, if we look out of the window we have a fantastic overview over the Elbe. This calm river affords a great antipole from the currently stock market mayhem.
Market review
On Monday the USD and JPY extended its gains versus the EUR for the third day on concern that the eastern European nations will jerk the Euro-Zone deeper into the recession as already suspected. On Monday the EUR/USD decreased from 1.2640 at its opening to 1.2546 at its low, but it recovered up to 1.2639 in the early Tokyo trading. The JPY also increased on continuing speculations that investors will bring back its earnings from overseas before Japan’s fiscal year ends on March 31st.
After Australia’s central bank decided to leave its key interest rate unchanged for the first time in seven months, the AUD/USD recovered its previous day loss and rose from 0.6300 at its opening to 0.6411 at its high. Incriminatory for the AUD appeared an Australian government report which expected that the commodity exports will fall in fiscal year 2010 for the first time since six years. On Monday also the NZD/JPY fell as equities dropped worldwide and the Dow Jones Industrial Average closed below 7000 points for the first time since 1997.
The EUR/CAD increased about 1.8 % to a three-month low initiate through a government economy report which showed that Canada’s economy shrank in the fourth quarter and the nation’s finance chief said that the negative economic news hasn’t ended.
EUR/CHF
Since the currency quit its bearish trend in Dezember 2008, the EUR/CHF has been trading in a small horizontal trend-channel between 1.5169 on the upper side and 1.4712 on the downside. Now it seems to test its support again, which is on the same level as the lowest Bollinger Bands. If it breaches this support it could initiate a new bearish trend.
GBP/CAD
We can see a typical Bearish Harami construction with a long packing at its top whereby a downward trend was introduced after the GBP/CAD rose 1.79 % on February 27th. This trend is still intact und it seems to test the next support-line at 1.7983. Besides the Momentum Indicator declined, crossed the Moving Average and is now under its zero level which could be a further bearish sign.
