EUR/USD
Euro lower on Greece, FOMC. Australian Market waiting on Unemployment data
The Euro is lower again today as concerns continue as to whether the Greek bailout will be postponed, or indeed whether it will go ahead at all. There has been talk today that it may need to be delayed until after the election in April, which means another couple of months of the same old story being dragged out and will not be healthy for the Euro or do anything to build confidence. There is no point in speculating, so when in doubt, go straight to the charts!
These don’t look very pretty either as the Euro currently sits at session lows, having collapsed on the news of the possible delay. It was comfortable at around 1.3170 but quickly lost a big figure and currently sits just above Fibo support (38.2% of 1.2623/1.3320) at 1.3045. In the short term this may well hold, as the hourlies are somewhat oversold, but the 4 hourly and daily charts are both pointing lower and an attack on the psychological 1.3000 level appears to be just a matter of time.
Markets are being driven by headline announcements from the various EU officials, and a spike higher, similar to yesterdays can happen at any time, so timing is everything. The Euro is currently operating within a channel (chart), the top of which is currently at 1.3195, so do not be surprised if, given the oversold nature of the short term charts we see a bounce towards that level, where sellers will be queuing up. The overall direction though appears to be lower. The levels to watch on the downside, below the Fibo 1.3055 level – which is also the current channel base – are 1.3000 and then 1.2972 (50% Fibo) ahead of 1.2928 (25 Jan low). Should we see a bounce above the top of the channel (looks unlikely), the next resistance would be at 1.3240 and then at 1.3280 and 1.3320. These look someway off, but if there is any good news, the relief rally could be strong, given the overwhelmingly bearish view.
Data today includes ECB Monthly Report, US PPI, Jobless Claims and more Bernanke speak.
Meta Trader – AxiTrader
EUR/USD: 4 hour
AUD/USD
The Aud remains choppy but within the channel of recent sessions and sticking pretty close to either side of 1.0700. Little action is likely before the unemployment numbers later in the morning where expectations are for the rate to rise to 5.3% current (5.2%) and for rise of 15K.
For the time being, continue to respect the channel parameters. These are currently 1.0650/1.0950. Although the dailies are pointing lower, the 4 hour charts are not giving much of a hint in either direction. The short term charts are suggesting that any pressure is likely to be seen on the downside.
Support levels to watch are at 1.0650/ 1.0625/ 1.0600 and 1.0570, while on the topside the 1.0775 high will prove a tough hurdle to overcome. Beyond there, 1.0800, 1.0825 and 1.0844 will all be resistance levels.
Wait for the data, but suspect we may want to head a little lower.
I normally avoid the $CAD like the plague and don’t ever remember making any money trading it in over 30 years!. It is however, worth looking at the daily AUD/CAD chart and the possible head/shoulder top that is forming. Currently at 1.0690, it needs a clean break of 1.0650 for a target of 1.0540. This would require breaking the 200DMA at 1.0590. Just a thought. I wont be getting involved!
Meta Trader – AxiTrader
AUD/USD: 4 hour
