|Day's range||0.678 - 0.686|
|52-week range||0.6426 - 0.7437|
Some weak numbers out of China this morning weighed on the Aussie Dollar and Kiwi Dollar early, with a busy economic calendar putting focus on the EUR & USD
It’s a big day for Europe, with the ECB Press Conference to drive the EUR and Theresa May’s last ditch efforts in Brussels to influence the GBP.
It’s all eyes on the Pound as talks of a vote of no confidence hit the wires ahead of a make or break emergency EU gathering tomorrow.
Considering a month long symmetrical triangle formation on EURUSD chart, the pair is less likely to register much momentum till it trades within the present range of 1.1305 and the 1.1435. Though, comparative strength of the US Dollar favor brighter chances of the pair’s decline than the otherwise, which in-turn highlights the importance of 1.1260 and the 1.1215 supports after 1.1305 break. In case prices continue drowning past-1.1215, the 1.1110 & 1.1080 may become Bears’ favorites. Meanwhile, an upside break of 1.1435 can trigger the pair’s rise to 1. ...
Following Theresa May’s decision to delay the parliamentary vote scheduled for later today, Brexit and U.S – China trade chatter will be in focus.
In my opinion, the single biggest influence on the Aussie and Kiwi at this time is U.S.-China relations. Even a Wall Street Journal article saying the Fed is likely to take a “wait-and-see” approach to future rate hikes failed to bring buyers into the AUD/USD and NZD/USD. Although we’re likely to see periodic rallies tied to oversold conditions or economic data, I don’t think the Australian and New Zealand Dollars will be able to mount a strong rally as long as there is uncertainty over the trade talks.
A shift in sentiment towards FED monetary policy and trade war jitters pin back the Greenback as the markets prepare for the next Brexit saga.
The direction of the AUD/USD and NZD/USD this week will likely be determined by investor demand for risk. And this is likely to be controlled by U.S. China relations. There are no major reports from Australia and New Zealand this week.
According to the WSJ, members of the U.S. Federal Reserve are reportedly debating whether to signal a “wait-and-see” approach after a probable hike to the central bank’s benchmark rate at its December meeting.
Can U.S NFP and wage growth numbers come to the market’s rescue? Some will be hoping for soft numbers to dial back expectations of a December hike.
With Australian and New Zealand Dollar investors focusing primarily on U.S.-China trade relations and a risk-off environment, today’s U.S. economic events may take a backseat. Look for further downside pressure today especially if U.S. equity markets continue to weaken.
It’s a choppy start to the day and unlikely to get better, with a heavy set of stats out of the U.S, Brexit and Trade Chatter to drive the majors.
The AUD/USD is under pressure on Wednesday after investors pushed potential rate hikes by the Reserve Bank of Australia further into the future in the wake of disappointing third-quarter economic growth. Economists expect the central bank to keep the cash rate on hold at 1.5 percent until at least the fourth quarter of 2019.
With the U.S markets closed focus shifts back to the Pound, which is under intense pressure as British PM struggles in the Commons.
In spite of the EURUSD’s recent recovery, the pair is still left to surpass 1.1430-35 resistance-confluence, comprising 50-day SMA & immediate TL barrier, which in-turn may trigger the quote’s dip to 1.1300 but an upward slanting support-line, at 1.1280, can limit its additional downside. In case the pair continue trading southwards past-1.1280, the 1.1260 and the 1.1215 could be cause of concern as break of which might not hesitate fetching the pair to 61.8% FE level of 1.1100. Should extra short-covering fuels the pair beyond 1.1435 on a daily closing basis, the 1. ...
Last week, Powell highlighted the growth of volatility in the global financial markets, the fading effect of tax reform, as well as the decline in demand outside the United States. All these factors, as noted by the head of the Fed, may interrupt rising rates by the middle of next year.
The Aussie and Kiwi strengthened last week because traders perceived the events as a bit dovish, encouraging the need for traders to aggressively adjust short positions. The CPI report, for example, suggested inflation is not overheating and may even be close to slowing down because of the plunge in crude oil and gasoline prices. The Fed comments also suggest a softer tone may be developing at the central bank. These factors could combine to convince the Fed to slow down the pace of rate hikes in 2019.
A quiet day on the data front could see the Pound and the EUR under pressure, with Brexit and the Italian coalition government in action.
The combination of the tame inflation report, comments from Fed Chair Powell on cooling global demand and the dovish comments from Fed Vice Chair Clarida stating the Fed is getting closer to neutral, are all signs the Fed may slow its pace of rate hikes and this should be bearish for the U.S. Dollar.
With economic data on the lighter side, we can expect geo-politics to continue to take center stage, the Pound in desperate need of good news.
The Aussie Dollar rallies early on better than expected employment numbers, with UK and Retail sales, Brexit and Italy to keep an eye on.
Australian Dollar traders are bracing for the release of the Employment Change report at 0030 GMT. It is expected to show the economy added 19.9K jobs in October. The Unemployment Rate is expected to inch higher to 5.1%.
The AUD/USD and NZD/USD should continue to be underpinned as long as investors remain optimistic over the developments over US-China trade relations. Technical factors could slow down the rally because both Forex pairs are nearing potential resistance areas. A risk-off scenario because of heightened stock market volatility, or turmoil in Europe is likely to drive investors into the safe-haven U.S. Dollar, which could put pressure on the AUD/USD and the NZD/USD.
Given the EURUSD’s extended downturn beneath 1.1300-1.1285 support-area, comprising 200-week SMA, the pair is likely to avail the 1.1120 and the 1.1020 rest-points prior to meeting the 1.1000 round-figure. In case the pair continue trading southwards past-1.1000, the 1.0835-25 and the 1.0770 may entertain the Bears. Alternatively, a D1 close beyond 1.1300 can trigger the pair’s recovery targeting the 1.1360 and the 1.1430 immediate barriers ahead of confronting the 1.1500-1.1510 resistance-area. During the pair’s successful rise above 1.1510, the 1.1580 and the 1. ...