EUR/USD Breaks higher, China PMI

By Easy-Forex | Daily Forex Analysis | Mon, Apr 23, 2012

U.S. Dollar Trading (USD) the market sold the USD into the weekend as the EUR/USD recovery extended higher. With little data out the market reacted to news flow from the Eurozone and in particular the increases to IMF funding pledged from G20 which amounted to 400bn. Looking ahead, No US Data to start the week.

The Euro (EUR) the EUR/USD broke above 1.3150 and we moved to 1.3220 as the IMF news combined with the better than expected German IFO to push higher. April German IFO increased to 109.9 vs. 109.5 forecast. EUR/JPY kicked to Y108 and is enjoying the upside in recent days. The Sterling (GBP) the GBP/USD rally extended on Friday kicking above 1.6100 and opens up 1.6500 this week with many seeing the downside over and all the GBP crosses moving technically higher. GBP/AUD moved above 1.5500. The EUR/GBP remained offered and closed under 0.8200 and is targeting the 0.8000 level going forward. Looking ahead, April German Manufacturing PMI forecast at 49 vs. 48.4 previously. Also ahead, Eurozone Manufacturing PMI forecast at 48 vs. 47.7 previously.

The Japanese Yen (JPY) USD/JPY held in a tight range above Y81.50 but is of risk of once again falling back as USD weakness usually moves across onto the USD/JPY if sustained. Crosses are supported for the time being but need sustained risk appetite to move higher. Australian Dollar (AUD) the AUD/USD was supported by the move higher in the EUR/USD but the market was hesitant at 1.0380 and we saw the Aussie fall behind. The GBP/AUD and EUR/AUD took advantage of the lagging Major to push higher with week highs on both and more gains expected. Looking ahead, April HSBC China PMI forecast at 49 vs. 48.4 previously.
 
Oil & Gold (XAU) Gold spent the whole day in a $5 dollar range above $1640 and is waiting for further inspiration. OIL/USD rallied with stocks and the Euro up above $104 and near $105 before easing into the weekend. The $105 level is a big resistance and could prove the pivot in coming days.

Pairs to watch

EUR/USD more upside once consolidation over?

GBP/USD on to 1.6300 now? 

TECHNICAL COMMENTARY

Currency
Sup 2
Sup 1
Spot
Res 1
Res 2
EUR/USD
1.2995
1.3058
1.3190
1.3213
1.3300
USD/JPY
79.50
80.10
81.35
81.80
82.80
GBP/USD
1.5895
1.6039
1.6115
1.6131
1.6170
AUD/USD
1.0226
1.0299
1.0335
1.0418
1.0453
XAU/USD
1600.00
1630
1642
1664
1683
OIL/USD
101.00

102.00
103.80
105.00
106.00