AUD/USD: 0.8760EUR/USD: 1.2645Unwinding of Yen cross positions was the main theme of the day as risk sentiment continued to improve in the higher equity markets following the recent sell-off. Another positive session today, could see a continuation of the same theme. Elsewhere, apart from the weaker Kiwi, it has been a range-bound session and that maybe the theme heading into the weekend given the comparative lack of data due today. UK GDP, German Consumer Confidence and US New Home Sales to be the highlights
Having successfully held above 0.8750 yesterday, the Aud made yet another attempt to squeeze above 0.8800, but again failed at 0.8805 and is now back at the bottom of the range.
With little data dues today, it could be another quiet session but it looks increasing ly that if/when 0.8750 gives way we could see a run to the downside. Below the spike low following the CPI, at 0.8745 would head towards last Friday’s lows around 0.8730 and then to 0.8700. I doubt that we are heading below here today, but if wrong, would hint at a run towards last week’s lows at 0.8685, 0.8675 and below there at 0.8651.
The topside would seem limited for now to 0.8780 although there is a chance that we could see a run back to 0.8800. Above there could head back to the recent highs at 0.8815, 0.8832 and 0.8860 although I can’t see it and would be surprised to see it back at 0.8800.
Economic data highlights will include:
China House Price Index.
Jim LanglandsFX Charts www.fxchartsdaily.com
