USD Trading Outlook (24-10-2013)
We saw some large flows and excessive volatility over the last 24 hours. Higher-than-expected domestic inflation data saw the AUD/USD take out technical resistance at .9715 before stalling at its 200-DMA near .9750. Breaking news out of the Chinese banking system which elevated some default risk then caused risk trades to crash lower (NZD/JPY during Asia, GBP/CHF during Europe). Add in to the mix a more dovish BoC statement and we end up with some very large moves. NZ trade data and the HSBC version of Chinese manufacturing PMI are the main event risks on the economic calendar.
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