Antipodean Currencies Advance On Risk Appetite

Antipodean currencies such as the Australian and the New Zealand dollars strengthened against their major counterparts in the Asian session on Thursday amid risk appetite. This was in the wake of the overnight gains on Wall Street after the Federal Reserve kept interest rates unchanged and said it would begin to unwind its bloated balance sheet "relatively soon".

Policy makers did not offer a specific timeline for further rate hikes, but will probably hold off until December barring an unexpected spike in inflation. Investors also digested strong earnings results from Samsung Electronics and Nintendo Corp.

Wednesday, the Australian and the New Zealand dollars strengthened against their major rivals. The Australian dollar rose 0.55 percent against the U.S. dollar, 0.23 percent against the yen and 0.11 percent against the euro. The NZ dollar rose 1.04 percent against the U.S. dollar, 0.80 percent against the yen and 0.72 percent against the euro. In the Asian trading, the Australian dollar rose to more than a 2-year high of 0.8066 against the U.S. dollar and more than a 1-1/2-year high of 89.42 against the yen, from yesterday's closing quotes of 0.8004 and 89.01, respectively. If the aussie extends its uptrend, it is likely to find resistance around 0.81 against the greenback and 90.00 against the yen.

Against the euro and the Canadian dollar, the aussie advanced to a 1-week high of 1.4566 and a 6-day high of 1.0021 from yesterday's closing quotes of 1.4656 and 0.9964, respectively. The aussie may test resistance near 1.43 against the euro and 1.01 against the loonie.

The aussie edged up to 1.0681 against the NZ dollar, from an early 3-day low of 1.0622. On the upside, 1.08 is seen as the next resistance level for the currency.

The NZ dollar rose to more than 2-year highs of 0.7558 against the U.S. dollar and 83.82 against the yen, from yesterday's closing quotes of 0.7521 and 82.59, respectively. If the kiwi extends its uptrend, it is likely to find resistance around 0.76 against the greenback and 85.00 against the yen.

Against the euro, the kiwi advanced to nearly a 2-week high of 1.5556 from yesterday's closing value of 1.5604. The kiwi may test resistance near the 1.53 region.

Meanwhile, the safe-haven currency, the U.S. dollar, fell against its major rivals amid risk appetite.

The U.S. dollar fell to a 2-1/2-year low of 1.1777 against the euro and a 10-month low of 1.3157 against the pound, from yesterday's closing quotes of 1.1733 and 1.3118, respectively. If the greenback extends its downtrend, it is likely to find support around 1.19 against the euro and 1.32 against the pound.

Against the yen and the Swiss franc, the greenback dropped to a 3-day low of 110.78 and a 2-day low of 0.9490 from yesterday's closing quotes of 111.17 and 0.9507, respectively. The greenback may test support near 109.00 against the yen and 0.93 against the franc.

The greenback edged down to 1.2414 against the Canadian dollar, from yesterday's closing value of 1.2446. On the downside, 1.23 is seen as the next support level for the greenback.

Looking ahead, Eurozone M3 money supply data for June is due to be released later in the day.

In the New York session, U.S. preliminary durable goods orders for June, U.S. weekly jobless claims for the week ended July 22, U.S. advance goods trade balance for June and preliminary wholesale inventories for June are slated for release.