The USD depreciated 0.3 percent to 101.51 JPY

Good morning from sunny Hamburg and welcome to our Daily FX Report. Yesterday in the World Cup semi final Germany demolished Brazil and won with 7-1. Germany will play either against Argentina or Netherlands, who face each other tomorrow. By the way Klose broke the goals record and becomes the tournament’s all time leading scorer with 16 goals. Former Brazil striker Ronaldo is the second best World Cup scorer with 15 goals.

However, we wish you a great trading day!

Market Review – Fundamental Perspective

Yesterday the Dow Jones Index of shares dropped 0.7 percent and the Standard & Poor’s Index also fell 0.7 percent. In addition global equity markets decreased on Tuesday while media prospects that the European Central Bank will probably not launch an asset-purchase program. On Monday ECB Executive Board member Sabine Lautenschlaeger, who is against a program of asset purchases, said this should be a last resort. Furthermore data showed yesterday that imports and exports in Germany, Europes largest economy, tumbled more than estimated. Exports fell 1.1 percent in May and imports weakened by 3.4 percent in May. The EUR/USD was at 1.3610 and the EUR bought 138.18 JPY. The USD depreciated 0.3 percent to 101.51 JPY. The next major focus for the market will be the release of minutes today from the U.S. Federal Reserve’s June meeting, which will be scoured for sings of when central bank members see an interest rate increase as likely. On Tuesday Minneapolis Fed President said that he welcomed the recent decrease in U.S. unemployment but also warned the labor market has still a long way to go until U.S. central bank has reached its goal on unemployment.
Yesterday a report showed that U.K. factory output dropped 1.3 percent in May from the previous month, the biggest drop since January 2013. The market estimated a rose of 0.4 percent. Nevertheless the GBP was nearly unchanged versus the EUR as investors overlooked this bad data. Furthermore the National Institute of Economic and Social Research said yesterday that the U.K. economy strengthened at a faster speed in the three months through June. The EUR/GBP was at 0.7945, after it had touched yesterday 0.7915 which was the strongest level since September 2012. The GBP/USD traded at 1.7133.

Daily Technical Analysis

EUR/AUD (Daily)

As you can see the currency pair had formed a head and shoulders pattern and left it by starting a bearish trend at the end of March along a downward trend line. At the support level around 1.4360 it found support and started to trade inside a bullish trend channel. The bullish MACD supports a trend reversal.

Support & Resistance (Daily)