Daily FX Report

Daily Forex Technicals | Written by Varengold Bank | May 18 09 09:10 GMT |

Good morning from Hamburg and welcome to our Daily FX Report. We hope you have enjoyed the weekend and start rested into the new trading week. Also this week comes up with important economic data's and decision, for e.g. the BoJ rate decision on Friday. We wish you a successful trading day Markets review In the first Tokyo trading hours the EUR declined to a two-week low versus the JPY and fell against the USD as Asian stocks slumped and reduced the demand for higher-yielding assets. The EUR was additionally bonded by speculation the European Central Bank will cut its key interest rate again. Notwithstanding yesterday, Axel Weber, ECB council member and the head of Germany's Bundesbank, said in a Financial Times interview, 'If the situation doesn't get significantly worse, then in my view the package of measures is sufficient.' He also said that the ECB doesn't see the risk of a broad credit crunch or deflation in the 16-nation euro-zone and predicted that the inflation rate will have a '1 before the comma' by the end of the year. The JPY rose to the strongest level in eight weeks against the USD on concern the recession in the world's biggest economy will be prolonged. On Friday the CHF decreased already versus the EUR amid speculation the Swiss National Bank will intervened again and sell the CHF to curb its advance. New Zealand's service industry contracted for the 13th month as sales slowed, a report showed today. Technical analysis EUR/JPY The currency pair has been trading close to a bearish trend-line since the beginning of the last week. During the May 13th and 15th the EUR/JPY showed a flag-tradingformation, which may suggest an impending trend reversal. Though for now it remains to be seen if the support at 127.31 may sustainable cross. The RSI adumbrate an oversold market and may support the bulls EUR/GBP The EUR/GBP went in the last three weeks up and down, it seems like an absolutely trendless market. At the moment the currency pair is arranged in a downward trend and fell below its support level at 0.8883. This approved terrain is down to its next support at 0.8850 rather 0.8827. Only the RSI Indicator may be strong enough to struggle against the downward trend Pivot Points - Daily FX Support and Resistance Levels Daily Calendar & Key FX Events Varengold Bank IMPORTANT NOTIFICATION TO BE READ IN CONJUNCTION WITH THE CONTENTS OF THIS DOCUMENT This document is issued and approved by Varengold WPH Bank AG. The document is only intended for market counterparties and intermediate customers who are expected to make their own investment decisions without undue reliance on the information set out within the document. It may not be reproduced or further distributed, in whole or in part, for any purpose. Due to international laws/regulations not all financial instruments/services may be available to all clients. You should have informed yourself about and observe any such restrictions when considering a potential investment decision. This electronic communication and its contents are intended for the recipient only and may contain confidential, non public and/or privileged information. If you have received this electronic communication in error, please advise the sender immediately, and delete it from your system (if permitted by law). Varengold does not warrant the accuracy, completeness or correctness of any information herein or the appropriateness of any transaction. Nothing herein shall be construed as a recommendation or solicitation to purchase or sell any financial product. This communication is for informational urposes only. Any market or other views expressed herein are those of the sender only as of the date indicated and not of Varengold. Varengold reserves the right to consider any order sent electronically as not received unless it is confirmed verbally or through other means.