Good morning. Today we are going to report about a strong USD and AUD while economists expect that the Federal Reserve will increase interest rates soon. The RBA increased already the borrow costs yesterday. Anyway, have a nice Wednesday and good luck in trading.
Market review
The USD climbed for a fifth day versus the GBP as a Federal Reserve official said the central bank may start increasing interest rates “sooner rather than later,” which boosted demand for U.S. assets. The USD climbed against 14 of its 16 major counterparts after Kansas City Fed President Thomas Hoenig said yesterday that raising interest rates wouldn’t derail the U.S. economic recovery. Yesterday Hoenig’s comments came after the RBA increased its main interest rates since the start of the global financial crises as the first country of the Group of 20. Anyways, the European central banks are expected to let their interest rates unchanged. The GBP/USD fell for a fifth day to 1.5905 and touched its lowest price during the October at 1.5805.
The JPY fell as Japan’s Nikkei 225 Stock Average climbed 1.3 percent and the MSCI Asia Pacific Index of regional shares advanced 1.5 percent. The EUR/USD fell a little back to 1.4709 after reaching its high at 1.4762 yesterday. The USD/JPY fell for a third day to 88.76 after touching a low at 88.65.
EUR/AUD
After pulling back from the middle pivot point at 1.6788, the EURAUD crossed the first support at 1.6571 and reached the support level from October 1st around 1.6510. If the pair breaks the 1.6510 support, it could make further losses towards the second pivot support. If not, it may recover back towards the middle pivot level at 1.6788.
AUD/USD
Since the beginning of August, the AUD/USD has been gaining along a bullish trend line. After touching the 0.8600 support for the third time, the pair gained back and touched the bullish trend line for the fifth time. If it doesn’t break this resistance, it may fall back and rebound the gains towards the support around 0.8600.
