Trading news

USD and equities strengthen as DB fears ease

- After suffering a small sell-off on Friday amid lacklustre economic data, the US dollar is broadly in demand on the first day of the week

- The pound may extend losses today after Theresa May declared that the government plans to trigger Article 50 of the Lisbon Treaty by the end of Q1 2017

- GBP/USD bias remains on the downside as the market continues to wait for the negative effects of the Brexit to unwind. On the downside, a strong support can be found at 1.2866 

-The yen was little changed in Tokyo in spite of a slightly weaker Tankan report

- USDJPY short-term levels may count on a support lying at 100.10 and a resistance at 102.79

 

After suffering a small sell-off on Friday amid lacklustre economic data, the US dollar was broadly in demand on the first day of the week. The New Zealand dollar was the worst performer among the G10 complex, falling 0.37% against the greenback, down to $0.7254. Overall, the currency pair is still trading within its short-term range between 0.7222 and 0.7369. NZD/USD has been testing its 50dma - currently at 0.7255 - for the past week and has always managed to close above it. However, buying interests continue to melt like snow in the sun. If broken, the road will be open toward the bottom of its uptrend channel - around 0.71.

 

The pound extended losses on Monday after UK Prime Minister, Theresa May declared that the government plans to trigger Article 50 of the Lisbon Treaty by the end of the first quarter of 2017. GBP/USD slid 0.26%, down to 1.2920. Obviously, the bias remains on the downside as the market continues to wait for the negative effects of the Brexit to unwind. On the downside, a strong support can be found at 1.2866 (low from 1.2866), if broken the low from July 6th, 1.2798 will act as the last and final support before uncharted territory.

 

The Japanese yen was little changed in Tokyo in spite of a slightly weaker Tankan report. The current business condition index for large manufacturing firms remained unchanged at 6 in the third quarter, below median forecast of 7. The outlook index was also unchanged at 6 versus 8 (consensus forecast). The yen edged down 0.10% against the greenback to 101.30. The short-term levels are the same as Friday, with a support lying at 100.10 (low from September 22nd) and a resistance at 102.79 (high from September 21st).

 

In the equity market, Asian shares were broadly trading in positive territory as fears over Deutsche Bank eased. The share of the German lender was up 14% in Wall Street and reached $13, up from $11.50 on Thursday. In Japan, the Nikkei was up 0.90%, while the broader Topix index rose 0.60%. In Hong Kong, the Hang Seng was up 1.02% while in Taiwan the Taiex rose 0.73%. In Europe, futures were rather mixed with the Euro Stoxx 50 down 0.23% and the Footsie up 0.09%.

Monday, 03 Oct, 2016 / 8:39

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Source : http://en.swissquote.com/fx/news

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