Rate gets slammed as stops and active selling from cross-spreaders break the rate under the 1.4440 support zone; retraces earlier gains to probe for stops in range. Rate likely to have stops building in-range to the upside now that downside stops cleared in a rush. Rate recovers ahead of the fix and regains the 1.4500 handle for most of the day but remains whippy.

Initial test of the psychological 1.5000 area now complete with the pullback likely about over as well and the rate is ready to try for the 1.5000 handle again. Rate likely to find buyers on any dip to the 1.4500 area as this was the breakout area. Rate tests the 50 day MA before recovering back to hold near the 100 day MA; aggressive traders can look to buy dips.

The USD suffered a violent whipsaw today first rising to highs during early New York trade before reversing to make lows against some pairs and end mixed. Rising to highs against the GBP, low prints were hit early as stops and aggressive selling dropped the rate to a low print 0f 1.4395 before short-covering and aggressive buying lifted the pair back to the 1.4500 handle to hold around 1.4510/20 area most of the day. Traders note middle-eastern names on the buy side around the 1.4420 area and slightly lower as the 50 day MA offered support helping the rate to reverse during the London fix.

The USD/JPY is heading south as our 1st tier uptrend line and 2nd tier downtrend lines reach an inflection point despite a better than expected Trade Balance from Japan earlier today. Japan's Trade Balance showed slight improvements in exports, although nothing to pour champagne over.

We feel the Trade Balance data could be a lagging indicator as it may not reflect the present export environment. What we do see is a currency pair succumbing to its negative tendencies, following U. S. equities lower.

The Cable has been incredibly volatile today as investors digest important employment data and the CBI’s release of Britain’s budget for the new fiscal year.  The GBP/USD shot up earlier after the Claimant Count Change number came in much better than anticipated. 

However, the currency pair has reversed course after Darling outlined the new budget and reduced his forecast for GDP growth.  Today’s data also comes with a negative asterisk attached since the average earnings data was much worse than expected, signaling consumption could take another big hit.

The EUR/USD continues its consolidation between our 2nd tier uptrend and downtrend lines, a sign that we could see a little near-term pop as investors bite on what may be oversold conditions. The EUR/USD is experiencing stability due to a better than expected Claimant Count Change number in Britain.

However, any near-term gains could be mitigated due to the highly psychological 1.30 lying just above present levels. Hence, the EUR/USD should experience more relative consolidation over the next 24 hours as investors await the flood of manufacturing and services data tomorrow.

The rally in gold cooled yesterday as the precious metal failed to test the highly psychological $900/oz mark. Gold is calmly walking along today despite a downturn in the S&P futures after a negative earnings release from Morgan Stanley.

The recent performance of gold has been erratic at best, and it's difficult to gauge what the precious metal has on its mind. While seemingly committing to the downtrend at the beginning of April, gold has since re-approached $900/oz twice.