AUD/USD: 0.7060EUR/USD: 1.0740It has generally been another choppy but rangebound session for the currency markets in thin holiday conditions, with Cable being the main mover after the unemployment rate fell to the lowest level since 2008. Equity markets are mostly steady, as are commodities with the exception of oil, which fell hard on increasing inventories. Today kicks off with the NZ Business PMI and the Australian Unemployment. Later in the day, the focus will be on Mario Draghi who will be speaking ahead of almost every Fed board member. Speeches will be coming from Bullard, Yellen, Lacker, Fischer and Dudley. That should ensure some confusion and hopefully some volatility!!
The Aud was relatively stable on Wednesday in the thin holiday conditions, trading a 0.7023/0.7077 range ahead of what could be a busier session today, with the release of the Consumer Inflation Expectation coming up ahead of the October Unemployment data (exp 6.2%, +15K, PR: 64.9%). Anything dramatically either side of here will give the Aud a directional move, although for the time being 0.7000 seems relatively well underpinned.
If the unemployment figures fail to meet expectations, increasing the chance for a RBA December rate cut, the initial support at 0.7020 will be tested ahead of 0.7012 (76.4% of 0.6900/0.7381) and then 0.7000. A break of this would then open the way for a steeper decline towards 0.6936 (29 Sept low) and to 0.6900 (4 Sept low) although at this stage this seems unlikely to be seen for a while.
The 4 hour charts look mildly constructive. A good jobs figure will open the way to gains back towards the session high, where the base of the daily cloud/100 HMA are providing good resistance ahead of 0.7085 (minor) and 0.7100 (23.6% of 0.7382/0.7018). Beyond this, the 200 HMA is at 0.7110 and comes ahead of the daily Tenkan, at 0.7119, which should be strong. The daily cloud top sits at 0.7170 but would seem too far off to worry about unless we see a stellar jobs number today.
Economic data highlights will include:
Consumer Inflation Expectation, Unemployment.
Jim LanglandsFX Charts
