USD Trading Outlook (18-11-2014)

AUD/USD All of Asia’s gains were erased in Europe as the USD regained its footings. AUD/USD slipped form the o/n high and sat just above 0.8730 as NY got going. The pair had been consolidating into NY’s open and early action saw that theme persists. The bear won out though as the USD firmed a bit further and US bond yields recovered off their lows. The pair slipped through Europe’s low and quickly hit a 0.8695 low. Some intra-day profit taking saw a bounce into Europe’s close. The remainder of NY was relatively subdued and the pair sat just above 0.8710 late in the day. The RBA’s minutes and RBA governor Stevens’ speech are the key risks later on. The minutes are likely to be status quo and harp on AUD strength and neutral rates. Traders will keep a close ear on Stevens though. Last week RBA’s Asst. Gov. Kent noted that intervention hasn’t been ruled out. Should Stevens utter intervention as well traders will take notice. AUD/USD might get hit. A test of the 10-DMA and TL support near 0.8670 as well as the Nov 14 low is then likely. A break below them could indicate the recent squeeze is done & a test of the 2014 low might be due.