- After Macrons win on Sunday evening, the EUR/USD has retreated from highs of 1.1023 to lows of 1.0916 overnight. A 50% retracement of the past months 450 pip rally would see the pair touch the 1.08 level. With a strong Non-Farms job number, some positive momentum behind Trumps Healthcare reforms, and an expected bounce back in US Inflation numbers due out this Friday, a move to 1.08 in the Euro is possible as the USD strengthens and Eurozone growth is temporarily overshadowed. Buying EUR/USD, EUR/JPY, EUR/AUD on dips is still, however, a sensible medium term trade.
- After two tests, USD/JPY has broken through the 113.00 resistance level, with the next major resistance level at 115.50. Given the pairs’ orderly grind higher since mid-April, dip buying at 60-70pip pull backs has provided opportunities for great entries.
- US Equities flat on the day, DOW (+0.03%) and the S&P500 (0.00%) has held the previous resistance level, now support at 2,393.
- Gold is sitting at the 1,226 level having tested it 6 times on the 4-hour chart. A test of the 1,220-level looking likely. A break of this level and traders will view 1,200/05 as buying opportunities, expecting gold to continue its uptrend of 2017.
- Australian Budget Release tonight, traders advised to keep an eye on commentary surrounding any risks to the countries AAA rating, inability of the government to reach budget surplus by 2021, and details on expected $50bln+ infrastructure spending package. While moves generally muted in the AUD/USD, any surprises could create good opportunities for short term traders in the ASX200. For those wishing to trade, please be in touch to ensure you’re receiving our 1-point, fixed spreads in and out of hours.
Today’s Economic calendar (AEST)
- 11:30am Australian Retail Sales
- 4:00pm German Industrial Prod. & Trade Balance
- 7:30pm Australian Annual Budget Release
