FROM THE MARKET: Calm before the FOMC storm - A typical day to tight consolidation ahead of the FOMC later today, with the AUD trading a touch softer after failing to break through 0.9135/40, while the Yen also gave back some of its gains from Tuesday. The bullish momentum in the AUD/USD was carried along the first few hours of Asia, however, the resistance at 0.9135/40 was too tough to break (200-day MA), resulting on a slide towards a session low of 0.9106; a slightly higher fix in the USD/CNY at 6.1351 vs 6.1341 Tuesday saw an over-reaction on USD/CNH, main trigger used by players to see the correction lower on the AUD. The market is worried of a break above 6.20 in USD/CNY due to WMP structures being potentially stripped out. From a broader perspective, it is important to highlight that the setup developed by the AUD/USD in the last 2 months (reverse H&S) suggests further gains are possible. The Japanese Yen traded softer in Asia, with a late bounce in the Nikkei 225 alogn afternoon trading underpinning Yen crosses. BoJs member Kiuchi crossed the wires, making pessimistic comments about prospects of QE, while during the session we also learnt, according to a Reuters poll that 7 out of 16 economists expect BoJ to ease further in the month of July. Fundamentally, Japan rleeased a worse-than-expected trade deficit. Technically, the pair needs to break above sticky resistance at 101.90/102.00 to ease selling pressure, while on the downside, solid firms have been reported all week, scattered btw 100.80-101.20. During the Asian session, market participants also learnt, according to Canadian Broadcasting Corp, that Canada’s new finance minister will be Joe Oliver, replacing Jim Flaherty, after his resignation on Tuesday. With regards to the rest of G10 currencies, no significant moves need to be reported ahead of the FOMC. Asian markets saw very subdued order flow as one would expect. You do not understand the above analysis but you want to participate in the market, do not worry; Learn forex with today, contact us: learnforexnigeria@yahoo or call: 08064653715.
Posted on: Wed, 19 Mar 2014 06:29:10 +0000
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