The Aussie is down more than 30 percent

Good morning from beautiful Hamburg and welcome to our latest FX Report of this week. Apple slid below its 200-day moving average for the first time since 2013 on Monday, and the stock is down more than 10 percent from its February high, meeting the common definition of a correction. The highest volume of shares since January were traded Tuesday. Apple has been falling since reporting disappointing iPhone sales in late July, stoking concern over whether the company can keep making must-have products. It’s been a mixed earnings season for S&P 500 companies. Among index members that have reported results, about 74 percent beat analysts’ profit estimates, while just 50 percent topped sales projections, according to data compiled by Bloomberg.

Anyway, we wish you a successful trading day!

Market Review – Fundamental Perspective

The dollar rose to a four-month high before the Aug. 7 employment report that may provide the Federal Reserve with enough evidence to raise interest rates for the first time in almost a decade. The greenback rallied versus most major peers as Fed Bank of Atlanta President Dennis Lockhart said in an interview with the Wall Street Journal that the central bank is close to a September rate increase. Futures prices showed traders were raising the likelihood of an increase next month. U.S. payrolls probably rose by 225,000 in July, according to the median estimate of 83 analysts surveyed by Bloomberg News. That compares with 223,000 in June. Traders are pricing in a 48 percent probability that the Fed will raise interest rates in September, based on the assumption that the effective fed funds rate will average 0.375 percent after the first increase. That compares with the 38 earlier Tuesday. he dollar dropped as much as 2 percent against its Australian counterpart as that nation’s central bank held interest rates unchanged and omitted any reference to further currency declines being necessary. Reserve Bank of Australia Governor Glenn Stevens and his board kept the cash rate at a record-low 2 percent, as predicted by markets and economists following reductions in May and February. The Aussie is down more than 30 percent since a peak in 2011 versus the dollar. The Bloomberg Dollar Spot Index added 0.3 percent to 1,214.12 at 5 p.m. in New York, reaching its strongest level on a closing basis since March 17. The greenback added 0.6 percent to $1.0881 per euro and 0.3 percent to 124.38 yen.

Daily Technical Analysis

EUR/PLN (Daily)

After building a new support level around 4.094 the EUR continued gaining versus the exotic currency.The Awesome Oscillator is now very close to turn the direction to the long side. It might be possible that this exotic pair continues climbing into a new long trend, if the next resistance will be broken sustainable. Higher spreads should be considered in traders risk reward ratio.

Support & Resistance (Daily)