AUD/USD: 0.7765EUR/USD: 1.1370While equity markets eased back on Friday after the failure of the EU leaders to reach any middle ground with Greece, the currency pairs were generally choppy, but rather directionless, in waiting for today’s emergency meeting to come up with a solution that would allow Greece to avoid a default. It does not appear to be a story that is going to have a happy ending although the Greek Government have come up with some, as yet unknown, 11th hour proposals over the weekend. Data wise, the weeks highlights will be the global PMIs, the US Durable Goods (Tues) and the US GDP (Wed). Following on from last week’s FOMC, further weak US data will see the dollar come under increasing pressure, although the economic numbers may be rather lost if Greece actually does fall over. It does not look as though we are going to have to wait too long to find out. It could be a big week. We shall see.
The Aud eased back from 0.7800 to finish at 0.7770 after a choppy session which saw an early NY test of the 200 HMA 0.7735 from where the bounce saw some sideways trade going into the weekly close, close to current levels.
There is little data due this week, with the highlight being tomorrows HSBC China Flash Manufacturing PMI and Wednesday’s China Leading Economic Index. Otherwise it will be an event driven week with Greece, as always, the focus.
The choppy action looks set to continue and there is little change in the outlook, although the dailies still look mildly positive and buying dips, with tight stops below 0.7700 may be the plan.
On the downside, back below the 200 HMA, now at 0.7740, would head towards 0.7700, a break of which could see a move back to 0.7670 and then to the previous session low at 0.7645 ahead of further support at 0.7630 and at 0.7600.
The topside would see sellers on a return to 0.7800 and at Friday’s high at 0.7813. Above here, unlikely today I suspect, would then head to resistance at last week’s 0.7848 high (50% pivot of 0.0.7532/0.8162), above which would then head to 0.7880 (50% of 0.8162/0.7602) and on to 0.7900 and to 0.7943 (61.8% of 0.8162/0.7602).
Economic data highlights will include:
M: CB Leading Indicator, House Price Index, HSBC China Flash Manufacturing PMI
T: China Leading Economic Index
Jim LanglandsFX Charts www.fxchartsdaily.com
