Market Insights 8 June 2011 Bernanke says stimulus still needed for ‘uneven’ US recovery USD generally weakens on Bernanke statement AUD/USD bounces back after yesterday’s decision to keep rates steady Oil, copper and other key commodities push higher In equity markets, the FTSE closed up less than 0.1%, while Dow was down 0.2%, the S&P 500 fell 0.1%, while the Nasdaq was virtually flat Headlines AUD/USD XAU/USD Resistance 1.0780 Support 1.0600 Market Sentiment Bullish (buy the dip) The AUD/USD fell about 60 pips following the RBA’s decision to keep rates on hold but bounced back after Bernanke’s statement caused the USD to weaken. Traders are eyeing the 1.0780 level of resistance, while a break below 1.0660 could set up a move to 1.0600. Gold continues to trade in a tight consolidation pattern with the highs at 1555 providing strong resistance. As we have mentioned over recent times, with the all-time highs at 1577, the market is expecting that a strong move to new highs will need some type of fundamental trigger. Resistance 1555 Support 1535 Market Sentiment Bullish
Bernanke says stimulus still needed for ‘uneven’ US recovery
USD generally weakens on Bernanke statement
AUD/USD bounces back after yesterday’s decision to keep rates steady
Oil, copper and other key commodities push higher
In equity markets, the FTSE closed up less than 0.1%, while Dow was down 0.2%, the S&P 500 fell 0.1%,
while the Nasdaq was virtually flat
Headlines
AUD/USD
XAU/USD
Resistance
1.0780
Support
1.0600Market Sentiment
Bullish (buy the dip)
The AUD/USD fell about 60 pips following the RBA’s decision to keep rates on hold but bounced back after Bernanke’sstatement caused the USD to weaken. Traders are eyeing the 1.0780 level of resistance, while a break below 1.0660 couldset up a move to 1.0600.
Gold continues to trade in a tight consolidation pattern with the highs at 1555 providing strong resistance. As we havementioned over recent times, with the all-time highs at 1577, the market is expecting that a strong move to new highs willneed some type of fundamental trigger.
The “round number effect” at 80.00 has continued to provide support with a small bounce seen in the USDJPY overnight. Abreak of 80.00 remains a distinct possibility and traders will be looking for a move back to 79.60 if a break does occur.
The GBP/USD is back at resistance and traders will be looking for signs of a reversal in order to ride prices back to the lowerend of the bracket. A break of 1.6470 could see the GBP push back to 1.6550.
The Euro has pushed right up to resistance at 1.47000/50 and we might see a reversal from these levels. Of course, the Euro’price action will be driven by any news related to Greece. A break of 1.4700/50 will be bullish.
Oil bounced back on that early overnight optimism but the move higher stalled at US$100. If oil continues to respect therange, then traders will be looking to ride the move back lower toward support at 97.50.
AUD/JPY is now looking increasingly bearish as the most recent price action suggests a descending triangle formation. A breakof 85.00 will be seen as an opportunity to take new shorts and an increase in pessimism could be the trigger for such a fall.
