Asia Brief: Australia New Motor Vehicle Sales -1.8 % vs -1.3 % previous. UK House Price Index 0.9 % vs -2.9 % previous. Japanese markets closed for a national holiday. Asian stock markets decline after bad Chinese factory orders data.
Global Markets: Shanghai Comp up 0.10 %, Hang Seng dropped 0.50 %, ASX declined 0.85 %. Gold at $1233 (+0.15 %), Silver at $18.64 (+0.20 %), Crude Oil at $90.45 (-1.00 %). US 10 year yield at 2.61.
FX Overview: The focus overnight was on the Aussie Dollar. Bad China econ data released over the weekend added to the already negative AUD sentiment. AUD/USD opened at 0.9018 in New Zealand, down 19 pips from the Friday close. It consolidated in a 0.8997-0.9017 range for most of the session, but another round of selling pushed it to a fresh low of 0.8981 ahead of the European open. Next support now seen at 0.8950, while intraday resistance lies at 0.9030 and then 0.9056. I expect that the Aussie Dollar, along with the other commodity currencies, will remain under pressure ahead of the FOMC on Wednesday and will sell rallies towards 0.91.
USD/CAD is slowly approaching the 1.11 level. Option-related supply has capped the topside for now, but a breakout is imminent. Above there, next resistance seen at 1.1155 (March 12 high) and then the key 1.1278 resistance level, which is the current yearly high. To the downside, expect good bids to appear between 1.1020 and 1.1030. NZD/USD is still posting fresh lows and there is little support until 0.8048 (February '14 low). Below there, the psychological support level of 0.80 will be key.
EUR/USD saw another short squeeze in the late Friday session and it seems that there might be a larger one coming soon should the Fed disappoint USD bulls on Wednesday. No doubt that the Euro will be heading lower eventually, but given extreme short positioning and how it is struggling to move lower, we could a squeeze up to 1.3030/50 first.
GBP/USD fell from 1.6270 to 1.6227 in Asia. Key intraday support at 1.6203 and then 1.6160. Resistance at 1.6280 and then 1.6325. The SW volatility stands currently at 15.30 (mid-price) as Scotland will hold the independence vote on Thursday. Nothing to report about USD/JPY. Flows were light as the Japanese desks were closed for a holiday.
Looking ahead, we have Swiss PPI data at 0715 GMT and the Euro Zone Trade Balance number at 0900 GMT.
Good luck!
Global Markets: Shanghai Comp up 0.10 %, Hang Seng dropped 0.50 %, ASX declined 0.85 %. Gold at $1233 (+0.15 %), Silver at $18.64 (+0.20 %), Crude Oil at $90.45 (-1.00 %). US 10 year yield at 2.61.
FX Overview: The focus overnight was on the Aussie Dollar. Bad China econ data released over the weekend added to the already negative AUD sentiment. AUD/USD opened at 0.9018 in New Zealand, down 19 pips from the Friday close. It consolidated in a 0.8997-0.9017 range for most of the session, but another round of selling pushed it to a fresh low of 0.8981 ahead of the European open. Next support now seen at 0.8950, while intraday resistance lies at 0.9030 and then 0.9056. I expect that the Aussie Dollar, along with the other commodity currencies, will remain under pressure ahead of the FOMC on Wednesday and will sell rallies towards 0.91.
USD/CAD is slowly approaching the 1.11 level. Option-related supply has capped the topside for now, but a breakout is imminent. Above there, next resistance seen at 1.1155 (March 12 high) and then the key 1.1278 resistance level, which is the current yearly high. To the downside, expect good bids to appear between 1.1020 and 1.1030. NZD/USD is still posting fresh lows and there is little support until 0.8048 (February '14 low). Below there, the psychological support level of 0.80 will be key.
EUR/USD saw another short squeeze in the late Friday session and it seems that there might be a larger one coming soon should the Fed disappoint USD bulls on Wednesday. No doubt that the Euro will be heading lower eventually, but given extreme short positioning and how it is struggling to move lower, we could a squeeze up to 1.3030/50 first.
GBP/USD fell from 1.6270 to 1.6227 in Asia. Key intraday support at 1.6203 and then 1.6160. Resistance at 1.6280 and then 1.6325. The SW volatility stands currently at 15.30 (mid-price) as Scotland will hold the independence vote on Thursday. Nothing to report about USD/JPY. Flows were light as the Japanese desks were closed for a holiday.
Looking ahead, we have Swiss PPI data at 0715 GMT and the Euro Zone Trade Balance number at 0900 GMT.
Good luck!
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