Article Highlights

  • Japanese banks closed in observance of Marine Day holiday
  • Gold prices hit five-year low on weaker Chinese demand
  • NZ Prime Minister Key: Kiwi has fallen faster than expected
  • German PPI and euro zone current account balance due
  • Greek banks to reopen today
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Since there were no top-tier reports lined up and Japanese banks were closed for the holiday, forex traders were able to pay closer attention to China’s gold reserves data and its impact on commodity prices. As it turns out, China added fewer than expected gold bars to its reserves, signaling a downturn in demand. This led the price of the precious metal to fall to its five-year lows, trading below $1,130/ounce today.

If y’all think that this is pretty bad news for the gold diggers out there, then you should also see how much damage it caused for the positively-correlated Australian dollar. AUD/USD dipped to a low of .7326 (-0.36%), AUD/JPY fell to the 91.00 mark (-0.25%), AUD/NZD is down 62 pips (-0.55%), and AUD/CAD is lower by 15 pips (-0.14%).

Other comdolls also took hits earlier in the day, as forex traders priced in the odds of seeing another global commodity price slump. However, the Kiwi made a decent recovery when New Zealand Prime Minister John Key remarked that the currency has fallen faster than expected and that the economy’s fundamentals are very strong. Forex Gump says “Yeah, right.”

NZD/USD bounced from the .6500 handle and is up 32 pips (+0.50%), NZD/JPY is up 42 pips (+0.52%), and NZD/CAD advanced by 54 pips (+0.65%) to the .8500 handle.

Up ahead, only a couple of low-tier reports are lined up from the euro zone, namely the German PPI (0.0% previous, 0.0% expected) and the region’s current account balance (22.3 billion EUR previous, 23.1 billion EUR expected). Positive surprises could keep the euro supported against its forex counterparts, but traders might be more interested to keep tabs on Greece’s situation. Word through the grapevine is that Greek banks are set to reopen today and that the parliament will resume their discussions on the specifics of the austerity measures. Do keep close tabs on commodity price movements as well!

U.S. Session Recap

Bonnie and Clyde, peanut butter and jelly, Justin Bieber and his hair. Some things just go well together.

In forex trading, you get better odds at securing pips when your fundamental analysis is complemented by technical analysis. Head on to Big Pippin’s Daily Chart Art for some pip-locking technical setups!