US$ firmer, as Greece concerns weigh on the Euro. RBA Minutes, German ZEW today's focus.

The US dollar took on a bid tone today as Greek concerns weighed on the European majors. The Aud$ also came under pressure after hints of further rate cuts from the RBA Governor, Glen Sevens. Equity markets liked the weekend announcement of the China increased stimulus programme and reversed Friday’s sharp falls. In the absence of any major data today it could be a sideways session as the market begins to focus on the Eurogroup meeting on Friday at which Greece will be the top of the agenda. The RBA Minutes will be the highlight in Australia, while Japan gets the Leading Economic and Coincident Indices.  Later on it will be the ZEW Economic Sentiment Survey that will be in focus, but that’s about it, in what could be a choppy but rather directionless session.

EUR/USD: 1.0737

Having peaked at 1.0820 early in Asia, the Euro was under pressure through the latter half of the session, falling to a low of 1.0710 as the dollar took on a broad based bid tone, with the ongoing Greek concerns never far from the surface. With not too much to drive trade today – aside from the German/EU ZEW Economic Sentiment Survey – it could be a session of choppy trade ahead, but with the Euro remaining under some downside pressure.

The technical points to watch remain pretty much unchanged, where the 100 HMA will provide the first support at around the session low at 1.0715, below which would visit the rising trend support at 1.0700 and the 200 HMA at 1.0683. Below here would see support at minor Fibo levels at 1.0645 and then at 1.0600, below which would then take another look at the congestion ahead of 1.0500 but looks unlikely to be bothered today.

On the topside, minor resistance will arrive at 1.0775 ahead of the recent 1.0800 pivot. Back above here would see good offers at 1.0820 and then at Friday’s high of 1.0848 a break of which would then head towards the 8 April high at 1.0887 and to the Fibo resistance at 1.0911 (76.4% of 1.1034/1.0461). Above here looks unlikely in the coming session, but further gains would see the Euro head on towards 1.0954 (7 Apr high) and then to the 1.1034 pivot, above which would put any thoughts of an immediate return to the downtrend on hold.

Look for a choppy session but with a mild bias towards testing the rising trend support at 1.0685.

Economic data highlights will include:

EU/German ZEW Economic Sentiment Survey.

Meta Trader – AxiTrader   EUR/USD: 4 Hour

USD/JPY: 119.17

Having been under pressure for much of the session, in making a session low of 118.52, the dollar has bounced to regain the 119.00 handle, currently at 119.22.

The choppy trade therefore continues, and with the 100/200 HMAs currently sitting at 119.10/65 it would not really surprise if these were to provide the parameters for much of the session. We are also back in the daily cloud and sitting right on the 100 DMA, and it looks as if this will continue to act as a pivot in coming sessions.

On the topside, sellers will be seen at 119.50 ahead of resistance offered by the daily Tenkan at 119.73 and then at the daily Kijun at 119.85/90. 120.00 may again be a stretch too far today, but further out, I still think the dollar will eventually head higher where additional gains would open up a move towards 120.50, 120.85 (both minor) and 121.00. As before, although unlikely to be seen yet, a topside break of 121.00 would open up the 20 March high at 121.20, the consolidation area at around 121.50 and the 10 March high at 122.02. If/when this level can be overcome, the way would open up for a run towards the 15 July 2007 high at 122.42, and in the longer term, the target of 124.13 (17 June 2007 high) would appear on the horizon but will take time.

On the downside, back below 119.00 would find bids again at the daily cloud base (118.90) and then at the session low at 118.52 which seems unlikely to be tested again today. If wrong, the next  support levels to watch, are at the 26 March low (118.32), the Fibo support at 118.20 (61.8% of 115.85/122.02) and at 118.00, but below which there is not too much to provide support until 117.30 (76.4%).

Economic data highlights will include:

Japan Leading Economic Index, Coincident Index .

Meta Trader – AxiTrader   USD/JPY: 4 Hour

GBP/USD: 1.4906

Cable was capped at 1.4982 at the start of the week and eventually sank to a 1.4887 low, in sympathy with the Euro, but received some mild support while the cross remained under pressure on the back of the concerns in Greece.

It is a pretty thin session today, as far as data is concerned, so a choppy session looks to be the most likely outcome.

Further downside pressure would find bids at the 100 HMA at 1.4880, at 1.4865 (daily Kijun and Fibo support (38.2% of 1.4565/1.5052)) and then at the 200 HMA at 1.4800. Beyond here, further Fibo sits at 1.4750 (61.8% of 1.4565/1.5052) and at 1.4680 (76.4%).

On the topside, back above 1.4900 would then head towards 1.4940 (minor) and to the session high at 1.4982. Above here looks doubtful today, but back above 1.5000 would then head towards Friday’s 1.5052 high and then towards 1.5100 (daily cloud base). Beyond this would target the 9 March high at 1.5136 and the next Fibo level at 1.5170 (61.8% of 1.5551/1.4565). This will be a very strong area of resistance, if seen, also being the top of the long term descending channel and the larger degree of Fibo resistance (23.6% of 1.7191/1.4565).Buying dips seems to be the way to go, but keep stops tight below 1.49, or below the Kijun (1.4865)..

Meta Trader – AxiTrader    GBP/USD: 4 Hour

USD/CHF: 0.9560

Having seen a low today of 0.9500, the dollar had bounced to 0.9598 before settling at 0.9560.

For the time being the 100/200 DMAs (0.9467/0.9593) look to have the range pretty well covered and I would not be overly involved ahead of what looks like a choppy but rather directionless session.

Above 0.9600 would open up 0.9633 (61.8% of 0.9862/0.9493) and the 100 HMA at 0.9660.

The downside will find minor support at 0.9530 ahead of the day’s low at 0.9500.  Below here would head towards the 100 DMA (0.9467) a break of which would see a run towards the 3 Apr low at 0.9454. Below there would signal a deeper decline towards the 20 Feb low at 0.9374 and then to the 17 Feb low at 0.9292.

Meta Trader – AxiTrader    USD/CHF: 4 Hour

AUD/USD: 0.7724

Further gains, following the surprise China RRR stimulus package, were eradicated after the RBA Governor Glen Stevens indicated that more rate cuts are a possibility despite Sydney house prices. The Aud headed quickly lower from earlier levels near 0.7800 to a low of 0.7705, before settling at 0.7725.

Today will be the turn of the RBA Minutes to provide the interest, but it seems likely that in the absence of any other major data today, that the Aud could chop around while waiting for tomorrow’s important CPI reading (exp 0.2%qq, 1.3%yy, Trimmed Mean 0.6%). Later in the week sees the NAB Business Conditions/Confidence and the HSBC Flash China Mfg PMI (prev 49.6).

The short term charts are pointing lower, so a test of 0.7700/05 could be on the cards, below which, the 200 HMA at 0.7690 will provide support. A break of this would then see us back in more familiar territory, within the consolidation area, heading towards 0.7675 and possibly to 0.7600.

Further out, the view remains unchanged, and once back below 0.7600, decent support would lie at 0.7575, 0.7550 and at the trend low of 0.7532 (2 April low). Below this, the RBA’s line in the sand at 0.7500 will provide stronger support but a break of which would open up the way to 0.7414 (Oct 2010 low). Beneath this there is a bit of a black hole until the very strong support at around 0.7200, where two important Fibo levels are lining up (0.7210: 61.8% of 0.4773//1.1082 and 0.7180: 76.4% of 0.6006/1.1082). I suspect that eventually 0.7000 will appear on the horizon (and even 0.6000!), but this is going to be some way off yet.

On the topside, the 100 HMA is at 0.7730, above which 0.7760 will see sellers ahead of 0.7800, which currently looks pretty safe. Above 0.7800, Friday’s high of 0.7842 will be the initial hurdle, but above which would suggest a run towards 0.7884 (26 March high), 0.7904 (25 March high) and to the trend high at 0.7937.

For the coming day, look for a choppy session with a mild downside bias, possibly on the back of some dovish RBA Minutes, looking to test 0.7700 and possibly 0.7675. Offers at 0.7760.

Economic data highlights will include:

RBA Minutes..

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NZD/USD: 0.7658

Despite the China RRR package, the Kiwi is a little lower today following yesterday’s NZ CPI miss  and the broad based US$ bid tone.

We are so far holding on above the day’s low of 0.7642 where the minor support at 0.7645 (Friday’s low) has so far held it up, but a break of which would then test 0.7610 (23.6% of 0.7175/0.7740). Below this would head back into the consolidation zone, where further choppy trade would seem likely ahead of 0.7530 (38.2%).

Further out, below 0.7500, support levels are at 0.7480 (minor) and 0.7440 (rising trend support). Back below the 14 April at 0.7421, the 1 April low at 0.7390 will come into view below which there are minor supports at 0.7372 (19 March low), 0.7326 (18 March low) and at the Fibo support at 0.7307 (76.4% of 0.7175/0.7696), a break of which would head back to the important base at 0.7270. Below here the Kiwi is headed back to 0.7175 (11 Mar low) and then to 0.7000.

On the topside, 0.7700 seems toppish today and would see good sellers ahead of Friday’s 0.7740 peak, but above which would suggest a run towards 0.7800 (23.6% of 0.8842/0.7175) and to the 200 DMA at 0.7872.

Meta Trader – AxiTrader    NZD/USD: 4 Hour