Good morning,
Quite a surprise overnight with Australia raising rates by 0.25% to 4.75% against market expectations.
As a result AUDUSD spiked by 100 points reaching a high of 0.9995.
EURUSD has been following the move and as I write is currently trading around 1.3940.
Yesterdays US stronger manufacturing data lent some support to the USD, since they might imply stronger GDP growth (and may be a softer QE).
Now we all know this week will be extremely busy and should be quite determinant to what the FED will do next. Firstly, tonight we will know the US mid-term elections outcome then tomorrow's FOMC should be finally explicit in regard to quantitative easing measures.
In the meantime, it is very difficult to have a clear idea of the next trend. We have been trading in a range and in terms of technicals we see a lot of triangle patterns looking to be broken soon.
My first contrarian take would be to think that the market expects too much easing and the surprise would be a higher USD, but since the FED can announce something quite big, I would not bet the ranch against it.
In terms of EURUSD levels, I have quite a big resistance around 1.3985-95, followed by 1.4035-45. On the downside, supports are @ 1.3870-80 followed by 1.3800.
I have no strong idea that could give a nice risk/reward trade as of yet, but will update as the day evolves.
Good trading,
No comments:
Post a Comment