USD Trading Outlook (01-09-2014)

AUD/USD A tight range held for most of Europe. They did try a run above 0.9360 but failed to gain much ground as solid offering interest was noted above the recent high and into 0.9400. A slide took the pair to the day’s 0.9332 low just ahead of NY’s open. Early NY saw limited action with the pair lingering near the low. A quick blip up near 0.9355 took hold on month-end USD sales but the rally was short lived. The USD staged a nice rally in the afternoon as EUR/USD made a new low for 2014. AUD/USD turned heavy and sat just above the day’s low late in the session. Action for AUD may increase significantly as there is major event and data risk due. The RBA meets and it’s likely Stevens will mention AUD’s strength again. He may have to bolster his rhetoric though as the market is mostly ignoring recent rhetoric. On the data front Q2 GDP and July retail sales and trade data are due. Should the stars align in favor of bears a retest of 0.9230/40 support is likely. If that is cleared bears will try their luck at key 0.9175/0.9200 support where the 200-DMA and May low sit.