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There have been four attempts to breach the 1.1260 mark (50% retracement) since Sep 24. However, all of them turned to be unsuccessful so far. Despite this fact, a decline of the Euro is also unlikely due to a dense cluster of nearby supports at 1.1160/22.
EUR/USD The intraday bias is bearish again after the recent slide through 1.1210, for a break through 1.1150, en route to 1.1012 area. Crucial on the upside is 1.1290.
Friday saw a big reversal in the price of gold following the publication of the US jobs report for the month of September.
In what was otherwise a very quiet overnight session, the Australian dollar edged higher as the Reserve Bank of Australia (RBA) maintained a neutral bias in its monetary policy meeting.
Both crude oil contracts are up for the third consecutive day, with Brent currently trading above the psychologically-important and key resistance level of $50 and WTI above $47 a barrel.
As we noted earlier today, the Australian dollar is edging higher on the slightly less-dovish-than-expected RBA statement, driving AUD/USD into resistance in the mid-.7100s.
EURUSD With EUR taking back all of its intra day gains to close lower on Monday, further weakness is now envisaged. Despite its current price hesitation, its broader outlook remains lower as long as it holds below the 1.1288/1.1318 zone.
The EURUSD had a bullish momentum yesterday topped at 1.1278. The bias is bullish in nearest term testing 1.1300 area. A clear break above that area and the triangle formation could trigger further bullish pressure testing 1.1400 – 1.1450 region.
Euro (1.1267) is trading higher today and may continue to remain choppy in the near term within 1.11-1.13. No clarity on further direction can be estimated unless a break on either side of the zone is seen.
AUDUSD The pair rallied strongly on Tuesday leaving risk of more strength on the cards. This is coming on the back of its recent corrective recovery offensive triggered from the 0.6936 level, its Sept 29 2015 low.
The euro soared against the U.S. dollar on Tuesday despite the release of downbeat German factory orders data, as receding expectations the Fed would raise interest rate this year dragged the dollar lower.
Precious-Gold traded near its highest level in two weeks on Tuesday as Fed's liftoff odds for this month faded after the release of disappointing nonfarm payrolls data. The yellow metal hit a low of $1139.69 an ounce, while it currently trading at $1136.32, after opening at $1135.32.
The majority of global equity markets are continuing their recent upturn in form, with the change in momentum and gains seen late last week continuing into the new trading week.
The major FX markets against the dollar are showing some strength in the morning session, with cable and the euro showing a bit more resilience against the dollar trading towards the highs of the session; USD/JPY relatively quiet.
There is a general feeling that the global slowdown is gaining momentum. Weak data (including manufacturing and trade) from the US, UK and EU and uncertainty from Asia indicates a period of subdued economic growth.
The August 2015 nominal merchandise trade deficit deteriorated more than expected to $2.5 billion from a revised $0.8 billion ($0.6 billion previously) in July. Market expectations had been for modest deterioration in the overall deficit to $1.2 billion.
The US trade deficit widened to $48.3 billion in August 2015 from a revised $41.8 billion shortfall in July (previously reported as $41.9 billion). The August deficit was only slightly larger than market expectations ($48 billion) and marked the largest shortfall since March.
October continues its positive trend: Friday's disappointing non-farm payroll (NFP) report has the market repricing the Fed's first-rate liftoff in a decade (October +5%, December +28% and dropping fast, March 2016 +50%).
The Bank of Japan (BoJ) shocked markets a year ago when it announced additional stimulus on Halloween day. A year has gone by and Prime Minister Shinzo Abe's lofty goal of 2 percent inflation remains elusive.
Yesterday's Reserve Bank meeting, while largely uneventful in terms of systematic changes in policy or direction, did have quite the effect on price with the Aussie Dollar putting in a solid 100 pip gain for the day.
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