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The Reserve Bank of Australia cut their interest rate to a record low 2.75% overnight. The move was unexpected as most analysts had the central bank remaining unchanged with interest rates at this meeting. The accompanying statement stated that the cut was made to encourage “sustainable growth in the economy, consistent with achieving growth in the economy.” The statement also inferred that there was room for further easing should the the economic outlook worsen.

The AUD broke through the 1.0220 support level after the RBA announcement testing support at 1.0175. The Aussie looks as if it will remain under pressure in the near term and a break of the 1.0150 level could see a quick run towards 1.0115. Resistance is now seen at the 1.0220 and 1.0250 level.

The EUR had a relatively quiet overnight trading period moving in less than a 30 point range after falling yesterday when ECB President stated that the central bank was “ready to act again” if it is necessary. Analysts are noting that President Draghi’s “shift” in language concerning the deposit rate is being seen as a strong indication that the ECB is prepared to act on the deposit rate if conditions warrant such a move. Last week, after the ECB lowered rates to 0.50%, Draghi stated that the ECB would keep an open mind regarding negative interest rates. Support for the EUR is seen at 1.3065, then 1.3040. Resistance is at 1.3110, the 1.3150.

USD/CAD tested support at 1.0060 during the overnight as traders looked at the increase in March building permits that was better than forecast as a positive sign for the “loonie”. Adding to the positive feeling on the Canadian Dollar, crude oil futures moved higher. Crude oil is Canada’s biggest export. A break of the support level at 1.0040, could see a move towards 1.0020. Resistance for USD/CAD is seen at 1.0090.

USD/JPY continues to tease traders looking as if it is ready to ascend towards the 100.00 level but then manages to fall back towards the lower 99 levels. Analysts continue to forecast the USD/JPY moving above the 100 level, but to this point the currency pair has remained stubbornly below that level. To this point the USD/JPY has reached a high of 99.95 on April 11, the highest level for USD/JPY since April of 2009. Resistance at 99.50 is pretty strong and is not expected to break over the next few days.

Surprisingly, the currency markets are not being affected by the Israeli-Syrian crisis, but if this conflict escalates it will surely affect the price of oil in the region and that would affect the USD going forward. There is concern here that Iran could join the conflict and increase the tensions already high in the area.

As far as today goes, there are some EU members commenting about Euro growth, but to this point there has been no real effect on the single currency. Add Slovenia to the list of countries in the Euro zone who might be in need of a bailout. While some EU members are saying it is too early to tell if this will be necessary, “where there’s smoke, there’s fire.”

The 1.3060 level is key for today. A break there could see some quick moves lower.