AUD/USD: 0.9330
EUR/USD: 1.3460
The Euro has had a choppy session against the dollar, having recovered from earlier lows seen after the release of the softer than expected EU growth data, to remain pretty much unchanged from this time yesterday, with the dollar under pressure following Yellen's testimony to the Senate.
The euro had softened after data showed that Q3 GDP expanded by 0.1%, slowing from the 0.3% growth in Q2, although expectations had been for a rise of 0.2%. Janet Yellen's testimony had been earlier distributed and she confirmed that the Fed's USD 85 billion in monthly bond purchases will continue to support the economy until a more sustained recovery becomes evident. This kept the dollar under pressure as
Treasury yields slipped, while equities rallied, with the Dow and the S+P both making new all time highs. Elsewhere in the U.S., it was reported that the initial jobless benefits last week declined by only 2,000 to a seasonally adjusted 339,000 against expectations of a fall of 11,000, which also put pressure on the dollar.
The U.S. trade deficit widened to USD41.8 billion in September from USD38.7 billion in August worse than the expectations of a USD39.0 billion deficit.
Today is pretty free of data, apart from the EU CPI which will give a hint of forward thinking of the ECB and could put a bit of pressure on the Euro. Later on, US Industrial Production will be the driver. Technically, little has changed. The shorter term indicators are now pretty flat following a session trapped between 1.3418/96. Good resistance remains in place at 1.3500 (1.3497: 38.2% of 1.3832/1.3294) and above here the daily Tenkan/descending trendline resistance is at 1.3516, which lies ahead of the daily Kijun at 1.3565 which may be a stretch too far today.
On the downside, bids will arrive at the day's lows (1.3418), below which would head back towards the previous session low at 1.3390. If we go under there we are likely to find bids at 1.3360 and below that at the 100 DMA at 1.3342, a break of which would see an acceleration onwards the Weekly Kijun at 1.3287.and then 1.3274 ( 76.4% of 1.3105/1.3832). Beneath there would see a run back towards the 2000 DMA at 1.3216 and under that, it would begin to look as though are going to retrace the
whole of the move higher that began at 1.3105.
Expect another choppy but directionless session today, covered mostly within the 1.34/1.35 range. Economic data highlights will include:
EU Meeting, C/Acc, CPI, US NY State Mfg Index, Capacity Utilization, Industrial Production, Wholesale Inventories
