Swiss Franc weakens broadly today, influenced predominantly by rally in benchmark European yields. Specifically, Germany 10-year yield breached 2.8% mark, reaching an 11-year peak. Euro managed to bounce back against the Australian and New Zealand dollars, which were burdened by concerns surrounding China's property sector. However, Euro's ability to gain against other currencies seems limited at present. While the recent Germany Ifo business climate suggests potential stabilization in the Eurozone's leading economy, a genuine recovery might be some way off. On another front, Dollar is seeking to extend its recent bullish run against Yen, helped by remarks from BoJ Governor Kazuo Ueda emphasizing a cautious approach. However, a pivotal challenge for the US currency will be breaking past 1.06 key resistance level when pitted against Euro. Also, Dollar remains stagnant against commodity-linked currencies, suggesting that further evidence is required to validate its buying momentum. Technically, NZD/USD's choppy recovery from 0.5858 is still extending. Near term outlook remains bearish for now, with 0.6014 resistance, as well as 55 EMA (now at 0.6004) intact. Break of 0.5858 will extend the whole fall from 0.6537 to 138.2% projection of 0.6537 to 0.5984 from 0.6410 at 0.5646. However, sustained break of 0.6014 will raise the chance that the pattern from 0.6537 has completed with three waves down to 0.5858, and bring near term reversal. In Europe, at the time of writing, FTSE is down -0.89%. DAX is down -0.93%. CAC is down -0.85%. Germany 10-year yield is up 0.0592 at 2.801. Earlier in Asia, Nikkei rose 0.85%. Hong Kong HSI dropped -1.82%. China Shanghai SSE dropped -0.54%. Singapore Strait Times rose 0.33%. Japan 10-year JGB yield fell -0.0182 to 0.731. |
