AUD/USD: 0.7875EUR/USD: 1.0925It was a choppy session today, with swings either way for the US$ but with most of the majors finishing up not too far removed from where they started. The major exceptions to this were Cable, which headed lower after weak UK CPI data, suggesting the chance of deflation, and the Chf which headed higher against both the dollar and the Euro. Today’s action will come via the German IFO, and then later the US Durable Goods will be the key focus. Until then there is not much to go on, although the NZ Trade balance is due shortly.
The Aud had a generally bullish feel to it for much of the session, which eventually saw a run to above 0.7900/10, taking out stops in NY in heading on to a spike high of 0.7937 before reversing quickly back to where it had earlier spent much of the session, sitting at 0.7875.
There is no local data due today. The RBA releases its FSR, albeit that little impact on AUD is expected.
Nearby support lies at 0.7860, a break of which would see the Aud head towards yesterday’s spike low seen after the Chinese Mfg PMI, at 0.7835. Beyond this, with the 4 hour indicators looking as though they want to roll over and head lower, we could be in for a run towards 0.7800 and then to 0.7775 although this may be a stretch too far today.
The topside will again find sellers at 0.7900 and above, at the session high at 0.7935. I don’t think we revisit this today, but if wrong, would open up the chance for a bigger squeeze, with the potential to revisit the Fibo resistance at 0.8010 (61.8% of 0.8294/0.7559) and the pivot level at 0.8025.
Look for 0.7830/0.7900 to cover it for the bulk of the session.
Economic data highlights will include:
Financial Stability Review
Jim LanglandsFX Charts www.fxchartsdaily.com
