Commodity currencies are in retrenchment mode this afternoon, consolidating the big gains made earlier in the session. Commodities are easier this afternoon with oil shedding earlier big gains. We were flirting with $76.00 this morning but have slipped into negative territory, now at $74.35. Stocks too have given up the bulk of their gains, now just to 2 points above trendline support at the 1100 level.
AUD/USD overcame important resistance at 0.9225 overnight and is now retesting that support level in quiet afternoon trade. A close back below 0.9225 would be a major disappointment for the momentum crowd that likes to buy high and sell higher.
USD/CAD has bounced to 1.0345, above old support at 1.0340. A close above 1.0340 will likewise make late-comers to the downtrend quite nervous.
EUR/USD trades close to New York lows after running into heavy central bank sales in the mid-1.2760s earlier today. News that Deutsche will tap the market for EUR 9 bln in capital, suggesting a long line of European banks will do the same, as a result of the upcoming Basel III accords.
