AUD/USD: 0.7375EUR/USD: 1.0820Everything was put in the shade by the Asian move in Gold yesterday, which collapsed from 1130 to a low of 1069 before recovering to currently sit at 1100. The US$ retains a generally bid tone, although the commodity bloc have been given a minor reprieve and trade a little higher. Elsewhere it was quiet, in the absence of any major headlines or economic data, and it could be the same again today, given that the highlight of the session will be the RBA Minutes, with little to come from either the EU/US.
Having recovered from an Asian sell-off to 0.7327, reaching a peak of 0.7397 when heading higher in sympathy with the Kiwi following some rather benign comments from NZ PM John Key, the Aud has had a sideways session, currently sitting unchanged from the Monday opening at 0.7370.
Today’s focus will be on the RBA Minutes, which are unlikely to offer too much support and may again wish for a lower currency.
Beyond today’s Minutes, attention will quickly turn to tomorrow's CPI (exp0.8% qq, 1.7%yy. Trimmed mean: exp 0.5%qq, 2.2%yy) and then to a speech from RBA Governor Stevens at 1.00 AET Sydney time, at which he will give his views on the economy and policy, with a Q&A to follow.
Given the lack of any other data today though, it may well be another range bound day for the AudUsd and a 0.7330/0.7400 session would not really surprise.
If seen, a downside break of yesterday’s low would then target 0.7300 and the Fibo extension support at 0.7288, (100% of 0.8162/0.7598 from 0.7848 – Blue Fibo structure on chart). Below this, there is then little to hold the Aud up until we reach 0.7200, which could appear on the horizon very quickly once the momentum, begins to build, albeit unlikely today.
The topside will again see good sellers on the approach to 0.7400 (100 HMA), above which would then head towards 0.7415 (200 HMA) and 0.7435, which would again act as strong resistance. A break of this although unlikely, would trigger stops, taking the Aud onto 0.7450 and possibly back to last week’s high at 0.7488 and even to 0.7500, although I don’t see it happening.
It would appear to be a sideways day, but us usual I prefer to play it from the short side.
Economic data highlights will include:
RBA Minutes, China CB Leading Economic Index..
Jim LanglandsFX Charts www.fxchartsdaily.com
