Daily Report: Markets in Tight Range

Market Overview | Written by ActionForex.com | Jul 28 08 07:14 GMT |

Markets are staying in tight range today so far and in view of a very light economic calendar, will probably stay so. Dollar edges higher against the yen earlier today but lacks follow through buying. Yen, on the other hand, regains some ground but remains generally pressured. Euro showed little reaction after Germany Gfk consumer confidence dropped to five year low of 2.1 and remains in tight range. Sterling is mildly lower after Hometrack said UK house prices fell the most since 2001 in Jul. The overall technical picture in dollar is still mixed. On the one hand, EUR/USD and GBP/USD are still holding above key near term support level. So is sharply sold off AUD/USD. There is no confirmation of trend reversal in these pair yet and dollar could reverse any time from the current level. On the other hand, outlook in USD/JPY, USD/CHF and USD/CAD are all suggesting that more upside to come. Markets will probably wait for Q2 GDP and NFP from US later this week before committing further. USD/JPY Daily Outlook Daily Pivots: (S1) 106.98; (P) 107.46; (R1) 108.33; More. USD/JPY edges higher to 108.07 earlier today but lacks following through buying so far. Though, intraday bias remains on the upside as long as 107.15 minor support holds. Further rally is still expected to test 108.58/59 resistance first. On the downside,below 107.15 will turn intraday outlook neutral first. But still, downside is expected to be contained by 106.04 support and bring rally resumption. In the bigger picture, USD/JPY has made a medium term bottom after down trend from 124.13 has just met 76.4% retracement of 79.75 to 147.68 at 95.78. Corrective nature of the fall from 108.58 to 103.76 indicates that medium term rebound from 95.77 is still in progress. Firm break of 108.59 key medium term resistance will confirm such rally has resumed for 61.8% projection of 95.77 to 108.58 from 103.76 at 111.68 first. On the downside, while another fall could still be seen if consolidation from 108.58 extends further, rally from 95.77 should still be in force and expected to extend high as long as 102.73 support holds.

Economic Indicators Update

GMT	Ccy	Events	Actual	Consensus	Previous	Revised
22:45	NZD	New Zealand Trade balance (nzd) Jun	-223M	-350.0M	-195.8M
22:45	NZD	New Zealand Imports Jun	3.81B	3.70B	3.92B
22:45	NZD	New Zealand Exports Jun	3.59B	3.35B	3.73B
6:00	EUR	Germany Gfk Consumer Confidence Aug	2.1	3.5	3.9
16:00	USD	FED Mishkin Speaks