AUD/USD seems to be able to bounce from a short-term space of curiosity!
Will we see a pattern continuation earlier than and/or after the FOMC‘s assembly minutes launch?
Earlier than transferring on, ICYMI, yesterday’s watchlist checked out spot gold’s (XAU/USD) pattern pullback alternative forward of RBA’s assembly minutes launch. Be sure you try if it’s nonetheless a superb play!
And now for the headlines that rocked the markets within the final buying and selling classes:
Contemporary Market Headlines & Financial Information:
On Monday, British Prime Minister Rishi Sunak stated he plans to give attention to tax cuts following a current decline in inflation.
On Monday, Financial institution of England Governor Andrew Bailey warned that the BOE might must hike rates of interest once more
New Zealand’s commerce deficit shrank from 2.43B NZD to 1.71B NZD as imports (-14% y/y) fell sooner than exports (-9.3% y/y) in October
In a panel dialogue, RBA Gov. Bullock sounded hawkish by saying that “Inflation is an important problem over the subsequent one to 2 years.”
RBA’s assembly minutes confirmed that the November price hike helped combat the “danger {that a} bigger financial coverage response could be required in coming months” as an alternative of being the dovish hike that merchants initially priced in
New Zealand’s bank card spending dipped by 2.9% m/m in October (+2.8% m/m earlier)
Switzerland’s commerce surplus narrowed from 6.2B CHF to 4.60B CHF in October as exports (-10.7% m/m) dropped sooner than imports (-4.9% m/m)
U.Okay. public borrowing picked up from 13.7B GBP to 14.0B GBP in October and marked the second-highest October borrowing on document
Value Motion Information
Overlay of JPY vs. Main Currencies Chart by TradingView
There weren’t quite a lot of recent catalysts within the markets in the present day, which meant that merchants had extra time to unwind their lengthy USD positions.
The safe-haven Japanese yen noticed a number of the greater strikes forward of potential market-moving information releases just like the FOMC assembly minutes and Europe’s PMI releases. It might have additionally helped that some USD/JPY merchants took cues from USD/CNH, which additionally mirrored the general USD weak spot.
JPY is within the inexperienced towards ALL of its main counterparts, however it’s particularly sturdy towards USD, EUR, and CHF to date in the present day.
Upcoming Potential Catalysts on the Financial Calendar:
U.Okay.’s financial coverage report hearings at 10:15 am GMT
Canada’s CPI stories at 1:30 pm GMT
U.S. present dwelling gross sales at 3:00 pm GMT
ECB President Lagarde to provide a speech at 4:00 pm GMT
FOMC assembly minutes at 7:00 pm GMT
Australia’s main index at 11:30 pm GMT
Use our new Forex Warmth Map to shortly see a visible overview of the foreign exchange market’s value motion! 🔥 🗺️
AUD/USD 15-min Foreign exchange Chart by TradingView
We haven’t seen quite a lot of top-tier financial information releases but however RBA Governor Bullock’s hawkish feedback saved AUD merchants busy earlier in the present day!
In case you missed it, RBA’s head honcho hinted that top inflation might be a “essential problem” within the subsequent 12 months or two and that an uptick in inflation expectations could also be a “downside.”
In the meantime, the continued unwinding of lengthy USD positions has boosted the Chinese language yuan and likewise not directly helped AUD’s prospects.
Sadly for AUD/USD bulls, the pair nonetheless turned decrease from the R1 (.6580) Pivot Level degree. That tracks with half of AUD/USD’s common every day volatility!
AUD bulls who imagine that RBA’s hawkishness and USD-selling would finally lengthen AUD/USD’s uptrend can try the .6560 earlier resistance zone that conveniently strains up with the 100 SMA within the 15-minute time-frame.
If AUD/USD bounces from the inflection level, then we will take a look at a doable return to the pair’s intraday highs if not new weekly highs.
But when the R1 Pivot Level line finally ends up being in the present day’s intraday highs and AUD/USD sees bearish momentum within the subsequent buying and selling classes, then it’s possible you’ll contemplate a possible short-term reversal for AUD/USD. Simply just be sure you’re seeing a breakout and never a fakeout!
AUD/USD’s subsequent route might rely upon potential catalysts just like the FOMC assembly minutes and Canada’s CPI stories due within the U.S. session.
Experiences that assist “peak price” bets for the foremost central banks might lengthen the risk-friendly buying and selling setting and push AUD/USD greater, whereas danger aversion may encourage deeper pullbacks or short-term reversals within the subsequent buying and selling classes.
