Currency Trading Summary

U.S. Dollar Trading (USD) was strong after the FOMC announcement but failed to break key levels against the Yen or the Euro and gave up ground against some risk currencies. The FOMC statement was largely unchanged although a better outlook on Unemployment helped to underpin the Dollar. DJIA -10 points closing at 10441, S&P +1 points closing at 1109 and NASDAQ +5 points closing at 2206. Looking ahead, Weekly Jobless Claims forecast at 465k vs. 474k previously.

The Euro (EUR) stayed within the 1.45 handle for the whole day as improved risk appetite and a commodity rally was countered by strength after the FOMC. December PMI Manufacturing was strong at 51.6 vs. 51.2 previously. EUR/GBP continued to fall as the Pound rebounded. Overall the EUR/USD traded with a low of 1.4504 and a high of 1.4592 before closing at 1.4525.

The Japanese Yen (JPY) tested 90 Yen after the FOMC but failed to break the key level with heavy Japanese Exporter selling at the figure. The recent uptrend needs to break above the Key level to target higher levels with most of the crosses also remaining range bound whilst the level holds. Overall the USDJPY traded with a low of 88.60 and a high of 89.98 before closing the day around 89.84 in the New York session.

The Sterling (GBP) rallied in Europe with very strong UK jobs data. November Claimant Count was -6k vs. +13.3 forecast the first drop in 2009. GBP/JPY remained buoyant although Cable fell back as the USD strengthened. Overall the GBP/USD traded with a low of 1.6204 and a high of 1.6322 before closing the day at 1.63 in the New York session. Looking ahead, November Retail Sales forecast at 0.4% vs. 0.4% previously.

The Australian Dollar (AUD) was the worst performing major currency as the pair was double punched by bad data and dovish comments from RBA officials. Q3 GDP was 0.2% vs. 0.4% forecast and RBA Deputy Governor Battellino commented that Australian Interest rates were now in the normal range. Overall the AUD/USD traded with a low of 0.8955 and a high of 0.9072 before closing the US session at 0.9000.

Oil & Gold (XAU) rallied with Oil shrugging off USD strength. Overall trading with a low of USD$1121 and high of USD$1140 before ending the New York session at USD$1135 an ounce. Continued to rebound as weekly US inventories numbers helped the market rally. Crude Oil was down +$2.30 ending the New York session at $73.05.