• Home ::
• Technical ::
• Market View ::
• Intraday Forex Technical Report

• Send
• Print
• Add To
• Rss

Intraday Forex Technical Report

U.S. Update: GDP surprise switch markets back to risk appetite

Thu, Oct 29 2009, 16:08 GMT
by Valeria Bednarik

FXstreet.com Independent Analyst Team

What happened

Despite being the most important and expect report of the day, many things happened since Asian opening: Japanese yen continued rising after Nikkei 225 lost more than a 2% in the first hour, breaking under 10000 points level, and sending Euro briefly under the 1.4700 level. Pessimism ruled the Asian session, with dollar consolidating or extending gains across the board, and yen gaining ground at a strong pace.

Pound was a clear exception, remained well supported against greenback above the 1.6330 area, extending above yesterday’s high during early European session around the 1.6460 level, only to quickly fell back.

The 3.5% expansion in U.S. gross domestic product –better than the expected 3.2%, and positive for first time in more than a year - interrupted recent broad slide in riskier asset classes and currencies as investors bid stocks and commodities back higher. Both dollar and yen begin to lose ground, against major rivals, with commodity currencies leading the way: AUD recovered above the 0.9100 level, while GBP/USD reached an intraday high of 1.6600. EUR/USD followed the crowed, thus raise has been more limited in the pair. Intraday high post report, reached the 1.4835 level.

What to expect

With European session ending, stocks and gold remain to the upside, suggesting more dollar (and Yen) losses for the rest of the day. After bouncing at the 61.8% retracement of the last daily up leg, EUR/USD is slowly approach to next key level, 1.4840, 38.2% of the same rally. Fighting right now with the 20 SMA still with a bearish slope, today’s close could be key for the pair: A confirmation above 1.4840 will suggest correction is over and pair will try to resume previous uptrend. Under 1.4770, pair will likely attempt to break the key 1.4700 support again.
 

Published on  Thu, Oct 29 2009, 16:10 GMT