Although the US Debt Plan has been passed by the House of Representatives, the markets still await the reaction of rating agencies
City Index August 2, 2011 8:56 PM
<p>A lthough the US Debt Plan has been passed by the House of Representatives, the markets still await the reaction of rating agencies, which will […]</p>
lthough the US Debt Plan has been passed by the House of Representatives, the markets still await the reaction of rating agencies, which will continue to cause nervousness within the markets.
Sterling closed in New York at 1.6295, off lows of 1.6238 after the rate had been pressed down from earlier European recovery highs of 1.6467. The rate consolidated the risk aversion pullback, with trade through Asia contained within a tight 1.6291-1.6325 range. Euro-sterling had managed to correct back from Monday’s highs of 0.8805 to 0.8723 in New York, with the rate contained in Asia by 0.8723-0.8751. Cable offers seen placed between 1.6325-1.6330, a break to open a move towards 1.6350-1.6360 ahead of 1.6390-1.6300 and the key level at 1.6420. Support seen at 1.6300, ahead of 1.6285-1.6280 and 1.6260-1.6250.
Euro-dollar closed in New York at 1.4251, off pullback lows of 1.4185 after the rate was pressed back from European highs of 1.4454. The rate extended its recovery to 1.4283 into early Asian dealing. The move up was aided by early demand for euro-yen out of Tokyo. The House of Representatives has passed the US Debt plan, it now goes to the Senate but is expected to be nodded through. However, the news failed to prompt any major excitement in Asia. Euro-dollar eased off highs, taking the rate to a session low of 1.4230. Support remains at the overnight low at 1.4230, with interest stretching to 1.4220 with stops below. A break exposes 1.4200 ahead of 1.4185/80. Resistance at 1.4280-1.4290 and then at 1.4320.
Gold had a rollercoaster day on Monday, trading as low as 1,605.90 in early Asia before rallying to highs of 1,632.00 after the weakest US ISM data for two years. Prices then fell back into the close to 1,619.50. Far East markets have led a small rally back to 1,624.70 as safe haven demand continues to support the metal. Silver traded as high as 40.05 yesterday, before closing at 39.30 but has risen in Asia to 39.70. Gold resistance is now at 1,630 and 1,637, with support at 1,608.00 and then 1,606.00. Silver resistance at 40.00 and 40.41, with support at 39.08 and 38.92.
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