AUD/USD: 0.7800
EUR/USD: 1.4475
The dollar gave up its early session gains, in choppy conditions, as the focus turns towards today's US employment/NFP data, until when, the markets should be fairly stable. The NFP is predicted to be 230K but following the recent spate of soft US data, the market is eyeing the chance a weaker than expected reading, which would put the dollar further on the back foot and send equities higher as any potential Fed rate hike again gets put on hold. The RBA Quarterly Monetary Policy statement is coming up and may create some waves for the Aud. Have a good w/e.
After a brief fall to 0.7733 yesterday, the Aud has clawed its way back to sit above 0.7800 as the focus turns towards the NFP, although ahead of that, the RBA Monetary Policy Statement will be released which will expand on the reasons for this weeks rate cut and more importantly we will get some guidance on how the RBA views future prospects for the economy and monetary policy. There will also most likely be further comment on the currency and another attempt to talk the Aud lower, so will be worth looking out for.
Technically, the Aud is currently sitting between the 100/200 HMA’s (0.7770/0.7830) and these could well continue to contain it. Further resistance is to be found at t the 26 Jan low at 0.7855 above which we could be in for a run towards 0.7900 and possibly to the 38.2% Fibo level at 0.7913. Beyond there would see the first greater degree of Fibo resistance at 0.7970 (23.6% of 0.8795/0.7720) and potentially to 0.8000.
Keep an eye out for the interesting reverse SHS formation that appears to be building (hourly chart, below ), with a neckline at 0.7895 and a potential target of around 0.8120.
Back below 0.7800 would find bids at 0.7770 (100 HMA) and then at the session low (0.7733). Further support will arrive at minor Fibo support at 0.7715 and then at 0.7700, beyond which, 0.7680 and the trend low at 0.7625 would again attract, but currently appear to be on hold unless the NFP is very strong indeed, which seems unlikely..
Economic data highlights will include:
RBA MP Statement.
Jim Langlands
FX Charts
www.fxchartsdaily.com
