AUD/USD: 0.7190EUR/USD: 1.0735The US$ is generally soft following the release of the FOMC Minutes although this appears to be more related to position squaring rather than any economic consideration. The move allowed commodities to make a mild recovery, while US stocks are pretty much unchanged. There is not too much data due for Friday (German PPI, EU Consumer Confidence, Kansas Fed Mfg Activity), although Mario Draghi will be speaking at the European Banking Congress in Frankfurt and will be the main risk event ahead of the weekend.
AUDUSD had a strong session in taking out several resistance levels, setting off stop losses and reaching a high of 0.7215, helped along by the general weakness seen in the US$.
Resistance now sits close by, at the major descending trend resistance (0.7215), beginning from Sept 2014, a break of which would trigger further stops and could see a run up towards 0.7223 (4 Nov high) and beyond, towards 0.7241 (61.8% of 0.7381/0.7015) and to 0.7295 (76.4%).
Support will appear at 0.7155/60 ahead of minor Fibo levels at 0.7140 and 0.7090. The 100/200 HMAs lie at 0.7115/0.7100 but these look unlikely to be seen today.
While the near term momentum indicators point a little higher, we could see some near term progress to the topside, although medium term players will be looking to sell into any strength hoping for another look at 0.7100 and eventually a fair bit lower.
Economic data highlights will include:
China Leading Economic Index.
Jim LanglandsFX Charts
