AUD/USD: 0.7690EUR/USD: 1.1280Growth concerns ruled out any renewed dollar strength today, while at the same time, event risk from the EU/Greece ensured that the Euro was able to make any gains and thus the currently markets are reasonable steady, despite some choppy price action. The big mover was oil, with WTI up around 3%, despite the concerns over the outlook for economic growth. Today could be another sideways session in the absence of any data from the EU/US although Cable may see some action on the release of the UK Industrial/Manufacturing Production and NIESR GDP Estimate. Ahead of that, the Aud will focus on a speech from Glen Stevens and also on the Consumer Confidence data.
After heading up to a high of 0.7722 following the release of yesterday’s mixed data, the Aud then drifted to a low of 0.7646, before squeezing higher in early NY and then drifting around below 0.7700 for the balance of the session.
Today sees the RBA’s Glen Stevens speaking to the Economic Society of Australia in QLD, who could well attempt to talk the Aud lower once again, although the market is now pretty used to this and he has increasingly less effect and any effort to do so may do little to cause any directional move. The Consumer Confidence data is also due, which may provide some minor ripples.
Technically, another run to 0.7700 would now run into the descending trend resistance, a break of which could see the Aud head on to the 0.7722 high and beyond, towards 0.7731 (23.6% of 0.8162/0.7595). A break of this could then see a larger squeeze towards 0.7760 and to 0.7775 above which would open the way to 0.7800 and to the 3 June high at 0.7818.
The downside is going to again see strong bids at 0.7645 and at 0.7615 ahead of 0.7600, although this looks unlikely to come under pressure today unless Glen Stevens is particularly strident in wanting the Aud to head lower. If wrong, then as we said before, below 0.7600 would open that way to a run towards the 0.7532 trend low and the RBA’s line in the sand at 0.7500, below which there is not too much to support the Aud ahead of 0.7414 (Oct 2010 low), and beneath that, there is a bit of a black hole until the very strong support at around 0.7200 where two important Fibo levels are lining up (0.7210: 61.8% of 0.4773/1.1082 and 0.7180:76.4% of 0.6006/1.1082).
Economic data highlights will include:
WBC Consumer Confidence, RBA Stevens Speech.
Jim LanglandsFX Charts www.fxchartsdaily.com
