By GCI Forex Research
Fundamental Outlook at 0800 GMT (EDT + 0400)
USD
Trading was subdued during the Asia session with Japan, Australia, and New Zealand all on holiday. The dollar managed to claw back some of Friday’s heavy losses in thin trade. EURUSD traded 1.3276-1.3363, and USDJPY 80.93-81.39. The Australian dollar retreated after setting new 28 year highs on Friday, when it rose to 1.0257 on fix-related buying. No US economic data were released. Today, the manufacturing ISM for December is due and our US economics team is inline with consensus, expecting a modest increase to 57.0 from 56.6 previously. FOMC minutes and the payrolls report are scheduled to follow later in the week. IMM positioning data which is normally released by the CFTC each Friday, will not be published until Monday evening due to the holiday season.
EUR
Estonia became the 17th member of the Eurozone on New Year’s Day.
Germany’s Chancellor Merkel and French President Sarkozy spoke in favour of maintaining the euro. Sarkozy said he will fight with all his strength to keep the euro as “the end of the euro would be the end of Europe”. Merkel said “Germany needs Europe and our common currency”, adding that the euro is “the foundation of our prosperity”.
AUD
Over the weekend, China’s manufacturing PMI for December disappointed expectations and fell back to 53.9 (cons. 55.0) from 55.2 previously.
TECHNICAL OUTLOOK
USDCAD eyes 0.9820 pivotal low.
EURUSD NEUTRAL Immediate focus is on support at 1.3216. Resistance lies at 1.3425.
USDJPY BEARISH Downside focus is on support at 80.54 low. Resistance is at 81.86.
GBPUSD BEARISH Abrupt rise with an immediate pullback puts focus back on support at 1.5425 low. The pair remains heavy below 1.5911.
USDCHF BEARISH Bearish outlook intact; focus is on0.9301 ahead of 0.9171 Fibonacci level. Resistance is at 0.9462.
AUDUSD BULLISH Bull trend intact; break of 1.0183 and 1.0211 Fibonacci resistance exposes 1.0333 high; support lies at 1.0152.
USDCAD BEARISH Breaks below 0.9931 key low, now targets 0.9872 ahead of 0.9820 pivotal low. Immediate resistance is at 1.0023.
EURCHF BEARISH Remains heavy below 1.2699 high. Focus is on 1.2400 ahead of 1.2283.
EURGBP BULLISH Sharp rise to 0.8643 followed by immediate pullback puts focus on 0.8503 near-term support; but the cross remains constructive above 0.8446.
EURJPY BEARISH Push through 107.61 would expose 105.80 key low. Resistance is at 108.93.
Forex Daily Market Commentary provided by GCI Financial Ltd.
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