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| Daily Market Review July 9th, 2009 Posted: 09 Jul 2009 02:54 AM PDT
Dollar and the JPY rallied strongly as risk aversion refloated. The weak Japanese Machine The commodities sector continued to signal weakness with oil falling towards 60$ a barrel as outlook for energy consumption continues to be vague. Gold was also under strong selling pressure and traded under 920$ an ounce with 900$ as the next support on the horizon .Evidently as “V” shaped recovery scenario seems to be replaced with a sluggish like recovery story investors expectations for inflation adjust strongly downward and with it oil and Gold which pose one of the most obvious hedge against inflation are pushed to cheaper levels. Overall it seems investors have come closer to realizing recovery can’t be taken for granted and risk aversion might be here to stay for a while, at least until some more evidence of real economic recovery will emerge. Support/Resistance
USD/JPY
The pair which has been trimmed around the 93.5-101 rage for a while has broken the 93.5 support which have maintained the pair in range so far .The pair has now found support around the 91.5 area where it rebounded back above the 93 zone. The break of the 93.5 support could signal a start of a bearish trend for the pair with the 88-90 as the first target. However the strong support the pair received around the 91.5 area which led to a 200 pips correction upwards could mean some more profit taking is on the way with the pair regaining bearish momentum either on the 93.5 resistance or even higher toward around the 97 resistance. Gold
After failing to trade above the 950$ level for several days Gold has retreated downwards breaking the bullish trend line at 925$ level and trading close to the 900 level where the metal gained support. Although the failure to break the 900$ could spark an attempt to regain bullish momentum only a daily close of above the 950$ area would indicate Gold is regaining strength to retest the 1000$ resistance. A break of the 900$ downwards would move the metal to retest the 860$ critical support. A break 860 support might lead to a strong selling pressure where investors lose the wiliness to hold the metal for a while. Daily Events
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