AUD/USD: 0.8705EUR/USD: 1.2650Poor data and a lower growth outlook from Germany and the UK undermined both the Euro & Sterling today, helping the US$ to find its feet again. The Euro & Cable will be in focus again today when the German CPI & UK unemployment will be released, while Mario Draghi will also be speaking, and who is unlikely to be helpful to the Euro in reiterating his dovish outlook. Before then, China will release its CPI/PPI, while Australia gets Consumer Confidence data. US Retail Sales to be released later in the day. WTI got hammered: down almost 5% on the day.
Yesterday's Asian gains, which saw a move to 0.8811, have been completely erased, with the Aud back at 0.8700, just above session lows of 0.8693 and while the short term indicators point lower, the choppy trade of recent days looks set to continue, with the daily charts still in corrective mode. Direction today will come via the WBC Consumer Confidence Survey and the China CPI, PPI.
The points to watch, on the downside, are at yesterday’s session lows at 0.8651, below which, the trend low at 0.8641 would come under pressure ahead of the July 2013 low of 0.8632. A break of this would then hint at a quick move towards 0.8600. Under here, there is little to suggest that the Aud will pull up ahead of the 50% pivot of the long term rally from 0.6006/1.1082 at 0.8538, but which is unlikely to be seen yet. Further out, as/when we do break below 0.8500, the way would then open up for a much deeper decline towards the May 2010 lows at 0.8066.
On the topside, 0.8740 will see minor sellers ahead of 0.8760 (100/200 HMA’s), beyond which would head on to 0.8800 and to yesterday’s high of 0.8811, albeit that this looks unlikely today.
Use 0.8660/0.8730 as a guide today
Economic data highlights will include:
WBC Consumer Confidence Survey, New Car Sales, China CPI, PPI.
Jim LanglandsFX Charts www.fxchartsdaily.com
