The USD/JPY was little unchanged at 106.25

Good morning from a sunny Hamburg and welcome to our latest Daily FX Report for this week. Hassan Abboud, the leader of the Syrian Islamist insurgents Ahrar al-Sham as well as other top commanders have been killed in a bomb blast at a meeting. Ahrar al-Sham is part of the Islamic Front which is a coalition of seven Islamist rebel groups and is one of the biggest rebel groups fighting the government of President Bashar al-Assad. It is likely that the Islamic State (IS) can be blamed for this attack according to local authorities.

However, we wish you a successful trading day!

Market Review – Fundamental Perspective

The JPY has lost 26 percent against the USD in the past two years; nevertheless Japan’s policy makers are keeping faith that a weaker exchange rate could help boosting the world’s third largest economy. In fact Japan's central bank and economy chiefs both signaled a green light for a further decline of the currency in order to stimulate exports. The USD/JPY was little unchanged at 106.25 and the EUR/JPY rose 0.1 percent to 137.51.
The Reserve Bank of Australia said this month that an overvalued currency could slower the economy’s transition to domestic growth drivers from mining investments. Also, the country is facing the longest pause in interest-rate adjustments since 2006. The AUD/USD fell 0.3 percent to 0.9178.
The USD/CAD has crossed the level of 1.10 for the first time within four months as speculation rose over the assumption that the U.S. Federal Reserve Bank would raise the interest rates faster than the Bank of Canada. Recent data increase uncertainty over the country’s economic situation and the Bank of Canada said that it was still waiting for rising exports.
Investors are focusing on the post-election turmoil in Sweden that could weaken the SEK as neither of the two major political blocs were able to win a majority. The SEK is expected to face an increase of its volatility against major counterparts and investor are building up post-election scenario for the currency. The vote is held on the 14th of September. The SEK is the worst performing G10 currency this year.
Finally the Bloomberg Dollar Spot Index, which tracks the dollar against a basket of 10 leading currencies, was at 1,045.83 after reaching 1,048.84 yesterday, which marks its highest level since July 2013.

Daily Technical Analysis

AUD/USD (1 Hour)

After a sideway walk this pair seem to have entered a bearish movement along the trendline. The downward movement started after reaching the level of the first resistance line at 0.94024. Even though minor appreciation occurred that pushed the pair back to the level of the first resistance at 0.92878, the downward movement continued. The present trend might continue as the level of the support line at 0.91868 has been crossed. Finally the Bears and the MACD seem to strengthen the hypotheses of a continuation of the present trend.

Support & Resistance (1 Hour)