Releases from Australia:
                                                 Forecast             Actual
January Home Loans         (MoM)   +1.0%              +2.3%
February ANZ Job Advertisements    +1.8% (prior)   - 2.0%
February NAB Business Survey            +13 (prior)        +11

Asian releases were limited to Australia this morning and were overall mixed. In spite of repeated rate hikes Australians are still borrowing money to buy property. January home loans increased by a robust +2.3% - more than double the forecast of +1.0%.

They appear to be ignoring the global slowdown and also the first decline in Job Ads in 15 months. Further January’s figure revised lower by 1.0% to +0.8%. It is hardly a huge problem right now with the annual figure still having risen by a solid 24.4%. However, with expectations that this turndown is probably the tip of the iceberg the year could see a deterioration albeit quite slowly.

And to top that the NAB’s February business survey also saw conditions continuing to slowly deteriorate also. At +11 it is still relatively high and the economy is nowhere close to being described as soft but it holds the same message of a slowdown that should continue for the rest of the year.

The following economic releases are due today:

January
U.K. DCLG House Prices                      (YoY)       +7.5%
U.K. Leading Indicator Index             (MoM) 
U.K. Coincident Indicator Index          (MoM)
U.S. Trade Balance                             USD      -59.5bn

February
Japan Machine Tool Orders (F)            (YoY)

March
German ZEW Survey: Current Situation                  30.0
German ZEW Survey: Economic Sentiment            -40.0
Euro-zone ZEW Survey: Economic Sentiment         -42.0

Well tentatively it does look as if we may have seen the end of this leg of the Dollar’s decline. It is still perhaps a little early to confirm since we haven’t seen too much of a recovery either so it’ll still be prudent to take care until there are greater signs of the pullback actually developing more strongly.

We should also remember that since there hasn’t really been much upside seen there is still a chance of marginal new lows around 101.20 Dollar-Yen and 1.0110 Swissie. The Euro looks less likely to see fresh Dollar lows at this point but the Pound – well that could see some movement.

Certainly out of all the 4 majors the Pound looks the most likely to rise to new highs. Still we have to be a little careful as it may stay in consolidation first but this does still look as if it could make 2.0357-2.0430. The only issue with this is that it should then produce a fairly significant high and then we’ll need to see how it can fit in with the Euro.

The Aussie’s looking a bit soft now too – a break below yesterday’s 0.9147 low would see it extend losses to 0.9087-0.9110. Anything below suggests 0.9031.

Note important support and resistance areas:

         USDJPY        EURUSD       USDCHF       GBPUSD
Res:  102.36-66    1.5459-72    1.0322-40    2.0248-83
Res:  101.85-07    1.5370-02    1.0250-83    2.0124-46

Spt:   101.20-40    1.5254-79    1.0131-65    2.0027-49
Spt:   100.26-46    1.5144-77    1.0095-10    1.9965-93

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