Euro falls on Retail Sales as Oil trades at a fresh record high for the third straight day

CURRENCY TRADING SUMMARY

U.S. Dollar Trading (USD) rallied broadly as productivity out of the world’s largest economy increased whilst Pending Home sales fell by -1% as expected. Earlier in the day Fed official Hoenig did emphasis the risk to upwards inflation stating that rates will need to be raised in a timely manner to counter the threat, further fuelling speculation that the easing cycle may e at its end. In other news, US consumer credit rose by $15.29 billion in March, its biggest rise since November.  In US Share Markets the NASDAQ was down by -44.82 points (-1.8%) whilst the Dow Jones was also lower by -206.48 (-1.59%). Crude oil continued to set record highs for the third straight day on supply fears trading at US$123.89 before ending the session up US$1.69 a barrel to US$123.53.

The Euro (EURO) declined rapidly on the back of poor retail sales figures. European retail sales declined 1.6 percent in March, the most since at least 1995 and twice as much as economists forecast, as soaring fuel and food costs sapped consumer spending. Overall the EURUSD traded with a low of 1.5453 and a high of 1.5595 before ending the session at 1.5528 in New York. Looking ahead the ECB is expected to keep rates on hold today at 4.00% with focus on the subsequent press conference

The Japanese Yen (JPY) tracked other markets with Japanese equities trading at four month highs. Overall the USDJPY traded at a low of 104.02 and a high of 105.12 before closing the day at 104.73 in the New York session.

The Sterling (GBP) fell to a 2 1/2-month low against the dollar after an industry report showed U.K. consumer confidence declined to the weakest in at least four years last month. Furthermore, U.K. manufacturing unexpectedly declined adding to expectation of rate cuts materializing out of the UK. Overall the GBPUSD traded with a low of 1.9637 and a high of 1.9772 before closing the day at 1.9729 in the New York session. The BoE is expected to keep rates on hold at 5.00% today.

The Australian Dollar (AUD) eased against a broadly stronger dollar and further hindered by a drop in gold prices. Overall the AUDUSD trade with a low of 0.9436 and a high of 0.9501 before closing the day at 0.9497 in the New York session. UPDATE: Unemployment Rate jumps to 4.2% (4.1%) for the month April with 25k new jobs. 

Gold (XAU) paired much of its gains on poor data out of the EZ. Overall the XAU traded with a low of 864.60 and a high 881.05

 
TECHNICAL COMMENTARY

Euro – 1.5355
Initial support at 1.5366 (May 7 low) followed by 1.5361 (Mar 2 Low). Initial resistance is now located at 1.5540 (May 7 high) followed by 1.5595 (May 6 high).
 
Yen – 104.80
Initial support is located at 104.03 (May 6 low) followed by 103.23 (Apr 29 low). Initial resistance is now at 105.71 (May 2 high) followed by 106.65 (Feb 28 low).
 
Pound – 1.9530
Initial support at 1.9504 (May 7 low) followed by 1.9410 (Feb 21 low). Initial resistance is now at 1.9736 (May 7 high) followed by 1.9913 (Apr 29 high).
 
Australian Dollar – 0.9420
Initial support a 0.9418 (May 7 low) followed by 0.9342 (May 5 low). Initial resistance is now at 0.9510 (May 6 high) followed by 0.9544 (Apr 23 high).
 
Gold – 868.30
Initial support at 863.80 (May 7 low) followed by 846.00 (May 2 low). Initial resistance is now at 883.00 (May 6 high) followed by 896.50 (Apr 25 high).