• Home ::
• Technical ::
• Analysis Reports ::
• Daily Forex Technical Report

• Send
• Print
• Add To
• Rss

Daily Forex Technical Report

a1b87169-cab1-4f76-bd2d-559661bc3f61

24

0

Daily Forex Technical Report − Dollar and Yen Firm on Risk Aversion Despite Speculations of Intervention

Thu, Nov 13 2008, 07:44 GMT
by ActionForex.com Team

ActionForex.com

Action Insight Daily Report

Dollar and Yen Firm on Risk Aversion Despite Speculations of Intervention

Dollar and yen remains firm into European session as global stock markets tumble following US Treasury Paulson's reversal on TARP. In short, Paulson abandoned the original plan to buy troubled assets and instead plans to use the remainder of the $700b funding to ease pressure on consumer credit markets. DOW dropped over 400 pts following Paulson's speech and the weakness in stocks carried on in Asia with Nikkei down over 5%. Crude oil dives further to below $55 before recovering mildly while gold reaches as low as 708.4. Dollar index climbs to as high as 87.62 and is set to test recent high of 87.87 as expected. Yen crosses also surge across the board. Nevertheless, note that the rally in yen somewhat slows in Asian session today on speculations of central bank interventions. Source in RBA confirmed the that bank has intervened by buying Aussie overnight. There are speculations that BoJ will follow in case of another sharp and strong rise in yen.

Technically speaking, the short term dollar bullish outlook remains unchanged and retest of 87.87 in dollar index is expected. Based on the view the triangle consolidation has already completed, 87.87 should be taken out decisively in near term. Sterling and other commodity currencies will likely continue to be the weaker ones. Euro has been supported by cross buying which is seen in EUR/GBP's making of new record high. However, weakness against dollar and yen should continue and based on current outlook, it's inevitable that EUR/USD and EUR/JPY will take out near term lows soon.

Data released overnight saw New Zealand retail sales rose less than expected by 0.1% mom in Sep. Japan CGPI moderated more than expected to 4.8% yoy in Oct. Q3 GDP in Germany contracted more than expected by -0.5% qoq with yoy rate down from 3.1% to 1.3% yoy. Looking ahead, Swiss combined PPI, ZEW, US and Canada trade balance will be released.

More Forex Technical Analysis Reports Here.

AUD/USD Daily Outlook

Daily Pivots: (S1) 0.6279; (P) 0.6471; (R1) 0.6593; More

As discussed before, rebound from 0.6008 should have completed at 0.7014 already. At this point, intraday bias remains on the downside as long as 0.6663 minor resistance holds. AUD/USD should head lower to retest 0.6008 low first. On the upside, above 0.6663 will turn intraday outlook neutral again.

In the bigger picture, whole fall from 0.9849 has likely completed the five wave sequence already, with the fifth wave ended at 0.6008. However, note that the impulsive nature of the fall from 0.9849 to 0.6008 indicate that price actions from 0.6008 is developing into correction/consolidation only. The long term down trend is still expected to resume after completing the consolidation. Sustained break of 0.6008 will indicate that the down trend from 0.9849 has resumed for at least another five wave medium term decline, targeting 0.4773 (01 low). But, note that strong rebound from 0.6008, will argue that consolidation is still in progress and above 0.7014 will target 38.2% retracement of 0.9849 to 0.6008 at 0.7475 before completing the consolidation.

For Crude Oil and Gold analysis, click here

Stay tuned with our Forex Newsletters

ActionForex is set up with the aim to empower individual forex traders by providing insightful contents. Analysis reports, live pivot points on majors and crosses, etc are provided with collection of carefully selected educational articles and free trading ebook downloads.

Published on  Thu, Nov 13 2008, 07:48 GMT