A stronger than expected US Retail Sales reading saw the dollar rebound today against all the major pairs. The Aud hit a new trend low on the back of an RBA call for the Aud to trade at 0.7500, while oil took another hit and is now trading below $60pb. It looks like being a choppy end to the week with the main focus being on China where the Industrial Production and Retail Sales will be closely watched. Later on, the highlight will be the US PPI.
EUR/USD: 1.2380
The dollar rebounded today after the strong US retail sales figure rose by the fastest pace in eight months, up 0.7% in November versus expectation of 0.4%, once again putting the chances of an early rate hike from the Fed back on the radar.
Having made it up to a high of 1.2494 in Asia, yesterday we are now back in the middle of the recent range, and with little data due until the US PPI and the R/M Consumer Confidence survey it looks like being a fairly directionless session, although the shorter term indicators do point marginally to the downside once more. Keep an eye out for the Chinese Retail Sales, which may cause some ripples, as could the EU Employment Change and Industrial Production.
The near term support lies close-by, at the session low, where the 200 HMA currently sits and backed up by the 100 HMA at 1.2360, below which would head back towards 1.2300. Below 1.2300 will find buyers ahead of the trend low at 1.2246 which lies just ahead of the next major level at 1.2225 (200 Month MA), a break of which would head towards the major rising trend support (joining the 2005, 2010, 2012 lows) at around 1.2140, and then to 1.2100 which is the 50% pivot of the rally from the Euro Oct 2000 low to the July 2008 high and should also provide decent support. Under that we have the July 2012 low at 1.2041 and the June 2010 low 1.1876, which both come ahead of 1.1743, where the Euro was initially pegged to the dollar in January 1999.
The topside will once more see sellers at 1.2400, with further minor resistance levels seen at 1.2450 and 1.2490 ahead of 1.2500. Beyond there, which looks unlikely today, would head towards the 26 Nov high at 1.2531, with the first major Fibo resistance not seen until we reach 1.2590 (23.6% of 1.3699/1.2246)
Look for a choppy but rather directionless session, with a mild downside bias although the 100 Month MA will probably hold it again today.
Economic data highlights will include:
EU Employment Change, Industrial Production, US PPI, Rts/Michigan Consumer Sentiment Index.
Meta Trader – AxiTrader EUR/USD: 4 Hour
USD/JPY: 119.25
The dollar reversed again after hitting a low of 117.43, in heading up to a high of 119.55 after the stronger US retail sales, before closing the US session at 119.20.
It looks like being a choppy session today, possibly capped by the 100/200 HMAs which are about to cross at around 119.60. A break to the topside though would then target 120.10 (61.8% of 121.84/117.43) and possibly 120.80 (76.4%).
The downside will again see bids, below 119.00, at 118.50 and at 118.00. It does not look like going back down here today but if wrong we could be in for a retest of today’s 117.43 low.
Look for a range of 118.80/119.80 to cover it today.
Economic data highlights will include:
Industrial Production, Capacity Utilisation.
Meta Trader – AxiTrader USD/JPY: 4 Hour
AUD/USD: 0.8257
After reaching a high of 0.8375 following yesterday’s unemployment data the Aud slid steadily lower through the rest of the Asian and Europeans sessions, and later on accelerated to a new trend low on the back of the stronger US retail sales and on a press headline that the RBA would like to see the Aud at 0.7500.
Currently at 0.8250, the focus is back on the downside, where the immediate support is seen at the new trend low and then at 0.8200. Below there, there is little support to be seen until the May 2010 lows at 0.8066 although 0.8200 could well hold it again today, but will be largely dependent on the outcome of the Chinese data due later on.
The topside looks likely to see good sellers once more at 0.8280 and then at 0.8300 (100 HMA). Above there could see an acceleration higher, although I don’t really see it getting back to the 0.8375 high again for a while.
Look for a choppy session contained within 0.8200/0.8300.
Economic data highlights will include:
China Industrial Production, Retail Sales, Urban Investment.
Meta Trader – AxiTrader AUD/USD: 4 Hour
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