Bank of Japan intervention keeps dollar yen around 79 20

The dollar has surged against the yen after a yen selling intervention by the BoJ. USD/JPY bounced up from yet another post WW-II low at 75.55.

Gold

Range: 1,704.00 – 1,744.75

Support: 1,702.50

Resistance: 1,752.75

Gold put in a very strong performance last week as equity markets rallied on the EU debt deal announcement. Gold added over $100 during the course of the week, closing out on Friday at around 1,744, having traded in a 1,635.60-1,752.75 range over the last five days. Asian markets this morning saw a brief rise to 1,745.25, before intervention from the Bank of Japan to weaken the yen sent the dollar soaring. Gold was also dragged lower but found support towards Thursday’s lows of 1,706.25 before settling around 1,713. Asian demand for physical gold has been steady if unexciting, questions still remaining over the fine details of the EU debt deal. Today’s support is seen towards 1,702.50 and 1,695.30, with resistance at 1,752.75 and 1,780.70

EUR/USD

Range: 1.3975 – 1.4170

Support: 1.3980

Resistance: 1.4150

Euro-dollar closed in New York at 1.4155, with the rate initially dropping to 1.4120 as the early market reacted to negative weekend press concerning last week’s EU Summit regarding the Euro zone debt solution. The rate recovered, marking highs at 1.41728 as the market began positioning for expected dollar sales to be seen into month-end fixings. However the move in dollar-yen prompted dollar buying; the euro dropped through 1.4120, with triggered stops below 1.4100 to 1.4050. Minor corrective bounces were overcome by continued sales to take the rate to an eventual low of 1.3974 ahead of the European open, with recovery attempts moving above 1.4120 into early Europe. Next resistance seen at 1.4150. A break here will allow for a move on towards 1.4075-1.4080. Support at 1.3980-1.3970.

GBP/USD

Range: 1.5966 – 1.6135

Support: 1.5965

Resistance 1.6015

Cable closed in New York at 1.6130, with early trade into Asia contained within a range of 1.6105-1.6039. The strong dollar buying, as the BoJ intervened to push dollar-yen higher, dropped cable lower. The rate broke below 1.6100 to eventually mark lows at 1.5965 as it took direction from euro-dollar moves. The rate is attempting to build on its recovery, though with the BoJ continuing to support dollar-yen, these moves could prove laboured. The end of the month is expected to produce dollar sales at the fixings, which could provide some buoyancy. If not, these could add to the recovery attempt. Support remains at 1.5965, with further interest seen close behind at 1.5955-1.5950. A break here to allow for a deeper move towards 1.5900-1.5890. Resistance seen at 1.6015, and more towards 1.6030, ahead of 1.6050.

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