30 May 2001, 18:00 US FX Daily Outlook: Dollar flat despite poor euro zone data
By Cornelius Luca
New York, May 30 (BridgeNews) - The dollar opens the U.S. session
virtually unchanged despite a further slide in French business confidence
in May, a euro-zone April M3 money supply rise of 4.7% on year, and the
collapse of the Alcatel-Lucent merger. Traders are looking for new leads,
but they might need to wait for Friday's U.S. jobs data before pulling the
trigger.
* * *
Euro/dollar and dollar/Swiss franc swerved quietly within their
respective Tuesday's ranges, while dollar/yen and euro/yen managed to
bounce from six-day lows of 119.93 and 102.40. Sterling/dollar slipped
from a one-week high of 1.4245 and dollar/Canada reversed losses after
slipping to a nine-day low of 1.5343.
Wednesday U.S. event agenda includes speeches by Chicago Fed Bank
President Michael Moskow and Federal Reserve Bank of Dallas President
Robert McTeer.
The U.S. session will likely be dominated by intraday speculation and
options plays.
Current Previous Change Global Global
NY open NY close low high
USD/JPY 120.13 120.17 -0.04 119.93 120.62
EUR/USD 0.8557 0.8553 0.0004 0.8536 0.8593
EUR/JPY 102.80 102.76 0.04 102.40 103.60
GBP/USD 1.4205 1.4222 -0.0017 1.4195 1.4245
USD/CHF 1.7824 1.7818 0.0006 1.7765 1.7870
USD/CAD 1.5402 1.5376 0.0026 1.5343 1.5419
AUD/USD 0.5132 0.5173 -0.0041 0.5116 0.5206
NZD/USD 0.4175 0.4209 -0.0034 0.4172 0.4219
SP.1 1263.10 -5.40 1262.50 1268.00
ND.1 1824.00 -32.50 1822.00 1862.00
* USD/JPY bounced from a 6-day low of 119.93 in Asia to a session high of
120.62 but fell again in Europe to below 120.00, and its subsequent bounce
in Europe lacked bite.
Japan showed signs of further weakening with business confidence
dropping.
Japans leading economic indicator is likely to stay below 50% for three
consecutive months. The IMF's Koelher said a weak JPY would strengthen
exports but didn't advise the government to weaken the currency to boost
the economy.
The outlook is mixed around the 100-day moving average at 120.34. Key
support is seen at the 119.65 Gann 50-point pivot, which targets 119.15
and 120.15.
Support: 119.93 (overnight low), 119.65 (Gann 50-point pivot; targets:
119.15/120.15), 119.00 (38.2% Fibonacci retracement level of the August
1998-December 1999 downtrend), 118.80 (May 24 trough; 6-month low), 118.25
(Gann 50-point pivot; targets: 117.75/118.75).
Resistance: 120.34 (100-day moving average), 120.62 (overnight high),
121.05 (Gann 50-point pivot; targets: 120.55/121.55), 121.82 (20-day
moving average), 122.58 (60-day moving average), 122.50 (Gann 50-point
pivot; targets: 122.00/123.00).
* EUR/USD managed to reverse light losses made in Europe but remained in
an inside range. A rumored option expiry at 0.8540 comes into play at 1000
ET kept the pair stable near the session low.
EUR/USD had drifted upward overnight to 0.8590 on the back of the
collapse of the Alcatel/Lucent merger.
There was no reaction to the euro-zone M3 figure. Euro area M3 money
supply grew in April, in data for the first time adjusted to exclude
non-resident holdings of negotiable instruments, by 4.7% on the year
compared with 4.6% in March. On the old basis, without excluding the
distortions it recently identified, it said growth was 5.2% on the year as
against an upwardly revised 5.1% in March. March growth was originally
reported at 5.0%.
French business confidence continued to fall in May, coming in at 104
and well below the analysts' expectations of 107.
Dutch central bank president and ECB member Wellink said the euro zone
was not invulnerable to developments elsewhere. He also said he was not
unhappy with the current exchange rate.
The EUR/USD outlook is mixed.
Support: 0.8536 (overnight low), 0.8480 (May 24 trough; 6-month low),
0.8401 (support line declining since Jan. 25), 0.8372 (Nov. 23 low).
Resistance: 0.8593 (overnight high), 0.8790 (38.2% Fibonacci
retracement level of the June-October downtrend), 0.8848 (61.8% Fibonacci
retracement level of the Nov. 27-Jan. 5 uptrend), 0.8744 (20-day moving
average).
* EUR/JPY followed USD/JPY in decent two-way activity and reversed losses
after marking a six-day low of 102.40 in Asia. The cross currency found
good support from the 200-day moving average.
The outlook is mixed.
Support: 102.48 (200-day moving average), 102.40 (overnight low),
101.04 (May 24 trough; 5-month low), 100.00 (psychological level), 97.22
(Dec. 12 trough).
Resistance: 103.60 (overnight high), 105.80 (38.2% Fibonacci
retracement level of May 1999-October 2000 downtrend), 106.52 (20-day
moving average), 108.83 (100-day moving average), 109.03 (60-day moving
average).
* GBP/USD fell from a one-week high of 1.4245 before it had an opportunity
to test the resistance of its declining 20-day moving average at 1.4262.
The outlook is mixed.
Support: 1.4195 (overnight low), 1.4074 (May 24 low; 6-month low),
1.3966 (Nov. 24 trough).
Resistance: 1.4245 (overnight high), 1.4262 (20-day moving average),
1.4329 (60-day moving average), 1.4402 (61.8% Fibonacci retracement level
of Nov.-Jan. uptrend), 1.4534 (50% Fibonacci retracement level of the Nov.-Jan. rally),
1.4436 (100-day moving average).
© 1999-2024 Forex EuroClub
All rights reserved