AUD/USD: 0.8630EUR/USD: 1.2545Despite new 7 year lows for the Yen against the dollar, it has been a largely sideways session for the major currencies, commodities and indices today , - and in the absence of any major data it could be much the same in the coming session. The focus will be on Mario Draghi, who will be speaking in early European trade and may create some waves, but that aside, there is little due apart from the UK PSNBR. Don't expect too much action. Have a good w/e.
AUD:Soft commodity prices and lower than expected Chinese manufacturing data kept the pressure on the Aud for the first half of the session as it fell to a low of 0.8665 before a bounce in NY on the back of the correction lower in US$Jpy.
The shorter term indicators now look positive again and we may be in for a bit more of a squeeze, above the session high of 0.8640, and on towards the 100/200 HMA’s at 0.8685. Above here could see a move back towards 0.8700/20, although I don’t really see it up here today.
A turn lower will find bids once more in the 0.8590/00 area, below which would revisit 0.8565 although this looks a little unlikely in the short term.
Look for 0.8600/70 to cover it today.
Further out as we said previously, the next support is seen at the 7 Nov low at 0.8540 and this will provide very strong support, being both the 50% pivot of the move from 0.6006/1.1082 and also the base of the monthly cloud. A break of this level though, and a November close below it, would have very bearish implications, for a test of the major channel base at around 0.8474 and then the May 2010 lows at 0.8066.
Jim LanglandsFX Charts www.fxchartsdaily.com
