AUD/USD: 0.7500EUR/USD: 1.1055After the opening gap in most currency pairs, it has been a relatively calm session with those gaps being filled, as traders sit on their hands, awaiting the outcome of today's emergency summit between Greece and its creditors. While this is almost the sole focus, there is plenty going on elsewhere, with the Chinese equity markets being keenly watched while being propped up by Chinese Govt. policy. Elsewhere, commodities had a rough session with Copper (-4%) and WTI (-7%) in particular taking a hit. This won't be much help to the Aud, which also awaits today's RBA Meeting and the likelihood of a dovish outlook. Elsewhere the main economic events will be the German Industrial Production, the US Trade Balance & Consumer Credit Change. The UK gets the Industrial/ Manufacturing Production, NIESR GDP Estimate. Coming up in NZ, the NZIER Business Confidence.
The Aud has had a choppy session, using 0.7500 as a pivot after trading a range of 0.7461/0.7532.
Currently sitting right on 0.7500, the initial direction today will come via the RBA meeting, although policy is expected to remain unchanged. Watch out for the chance of a more implied easing bias in the statement, which would keep the Aud under pressure. Elsewhere Chinese equities managed to avoid further panic yesterday, care of the Chinese Govt, but that will again need to be closely watched, as will the Iron Ore price, which again fell sharply as did both Copper (-4%) and WTI (-7%).
Technically, on the downside, below 0.7460 would open up the way to 0.7414 (Oct 2010 low) beneath which there is a bit of a 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).
On the topside, the Aud will see sellers at minor descending trend resistance at 0.7555 and then at 0.7580 (minor) and at 0.7600 (100 HMA). A break of would see a rally towards the 200 HMA at 0.7645 and on to the larger descending trend resistance at 0.7690, but at this stage looks unlikely.
Selling into strength remains the preferred plan.
Economic data highlights will include:
AIG Construction Index, RBA Interest Rate Decision/Statement.
Jim LanglandsFX Charts www.fxchartsdaily.com
