AUD/USD: 0.7505EUR/USD: 1.1100The US$ has recovered some of last week's lost ground on Monday, as we approach the FOMC Meeting on Wednesday. The commodity bloc currencies in particular came under pressure against the US$ after being led lower by the slide in the price of both oil and Gold. Today’s interest will come from the BOJ meeting, although no change to monetary policy is expected, and then later on in the session when the US Retail Sales, Business Inventories and PPI are all due. The RBA Minutes are due and Kiwi traders will look towards the Global Dairy Trade Index, due in European trade, for direction.
AUDUSD is lower on Tuesday, in line with softer commodity prices, having headed into reverse after making a new trend high of 0.7593. It currently sits near 0.7500 ahead of the RBA Minutes, which are due today. These should see the RBA's “wait and see” tactics continue to prevail although the ongoing soft data coming out of China will remain a concern. The minutes may also once again wish for a lower currency, although right now they are not seeing much likelihood of that, with the Aud currently around 6% higher against the dollar than at the time of the last meeting.
Further losses would see the Aud head back, below the 100 HMA (0.7490), towards 0.7477 (23.6% of 0.7108/0.7593) .Beyond this we could see a run back to 0.7435 (200 HMA) and then to 0.7405/10 which is now strong support, being both 38.2% of 0.7108/0.7583 (0.7405) and also 23.6% of 0.0.6826/0.7583 (0.7410). Below 0.7400 could see an acceleration towards 0.7350 (50% of 0.7108/0.7583) and lower towards 0.7300, although unlikely today.
If the Aud does recover, sellers will arrive at 0.7520 and 0.7550 (both minor) beyond which would look to squeeze back to the 0.7593 session high. Further gains would take the Aud beyond the May/June 2015 double bottom lows at 0.7597 and 0.7600, and on towards the next Fibo resistance which is seen at 0.7648 (61.8% of 0.8162/0.6826). In the longer term, the next major Fibo level is at 0.7845 (38.2% of 0.9504/0.6826).
Economic data highlights will include:
Australian New Vehicle Sales, RBA Minutes.
Jim LanglandsFX Charts
