Collinson FX Market Commentary: June 5, 2012 - Currency against trend

Pic of the Day 2nd - 2012 European 18 Footer Grand Prix I. (Hungary, Lake Balaton)
Gabor Turcsi

Collinson FX market Commentary: June 5, 2012

The flood of negative economic news continued with weak data from China, Europe and the U.S..The previous week broke technical levels and erased 2012 gains in equity markets. Currencies surprisingly resisted the moves with the EUR bouncing back to 1.2480 and the GBP 1.5375. This may be a dead cat bounce as technicals and fundamentals point the same way.

In China Non Manufacturing PMI fell from 56.1 to 55.2. In Europe Investment Confidence remained critically weak and PPI was flat. The U.S. Followed with Factory Orders falling 0.6% and the New York ISM contracting below 50.

Australian equity markets were hammered from the fallout from the U.S. Employment data over the weekend. Job advertisements fell and Company profits slipped a further 4%.

The AUD improved to 0.9725 following a consolidating USD. The KIWI held resistance levels and built back to 0.7570 but further upheavals in Europe are likely to test the all important 0.7500.

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