- There has been plenty going on in the FX space – EUR/USD subsequently plummetted to a low in the 1.0930s.
- EUR/AUD sidelined, but looking ahead, we will have the Reserve Bank of Australia.
EUR/AUD has stalled on the advance from the recent bottoms of 1.5905 having run into supply at the 1.63 handle meting the 200 4-HR SMA. EUR/AUD is currently trading at 1.6211 and sidelined ina quiet start to the Asian session.
There has been plenty going on in the FX space, but volatility is not allowing for trends and the Dollar was the major beneficiary of the sporadic price-action, rallying some 0.70% overnight in the DXY as the shortfall in the repo market and higher yields supported the bid. EUR/USD subsequently plummetted to a low in the 1.0930s. AUD/USD also suffered and extended losses to 0.6739 and a fresh low since Sep 3rd prices.
The outlook is somewhat murky from here considering its all about the Dollar until we will hear from the Europan Central Bank’s governor, Draghi, who speaks at a conference in Frankfurt while the ECB will also publish its Monthly Economic Bulletin.
RBA to cut and AUD to fall
Looking ahead, we will have the Reserve Bank of Australia meeting this is where EUR/AUD bulls could get a leg up – For the RBa is widely expected to cut at next week’s meeting. Analysts at ANZ Bank explained that governor Lowe noted the international backdrop saying, “interest rates around the world”¦ are moving lower”, and “we live in an interconnected world, which means that we cannot completely insulate ourselves from long-lasting shifts in global interest rates”.
“He said that the economy was “at a gentle turning point” but “the strength and durability of the pick-up remains to be seen”. We think the Bank has had an accumulation of evidence over the past two months – rising unemployment, falling consumer confidence, further global monetary easing – that suggests that further rates cuts are required.”
EUR/AUD levels
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