European markets calm ahead of French Presidential election
|AUD / USD
Expected Range: 0.7440 – 0.7560
The Australian Dollar is slightly weaker today when valued against its US counterpart falling overnight to a low of 0.7490, down 0.86 per cent for the session. Yesterday we saw the release of New Motor Vehicles Sales for the month of March. The March 2017 trend estimate decreased by 0.3% when compared with February 2017. NAB Quarterly Business Confidence will be released today at 11.30am AEST. The AUD/USD pair is currently trading at 0.7494. We now expect support to hold on moves approaching 0.7491 while any upward push will likely meet resistance around 0.7609. The Australian dollar is also lower this morning against the Yen (81.64) and the Euro (0.6996).
NZD / USD
Expected Range: 0.6950 – 0.7050
The New Zealand dollar edged lower through trade on Wednesday as commodity prices fell and the US dollar recouped some of the week’s earlier losses. Breaking below the 0.70 handle the NZD touched intraday lows at 0.6997 after commodity prices, led by oil and iron ore tumbled and risk appetite continued to wain in the face of increasing tension on the Korean Peninsula. The early week rebound appears vulnerable ahead of Today’s CPI print with near term support resting at 0.6950, while a break below 0.6860 could signal a bearish channel has formed. However a stronger than expected print and read above the RBNZ’s 2% target could prompt a move back toward key technical resistance points at 0.7075/71. All eyes today turn to CPI and risk appetite for direction into the end of the week.
GBP / AUD
Expected Range: 1.6950 – 1.7150
The Great British Pound has pulled back a shade off six-month highs witnessed on Tuesday against the Greenback, the pair moved lower to 1.2790 however still remains in a strong position buoyed by the UK Prime Minister announcing a snap election to solidify her mandate for Brexit negotiations. Meanwhile, the Greenback remains under pressure as geological tensions play a leading role amongst the markets and expectations of a June rate hike by the US Fed has reduced. Looking at overall weekly percentage changes the Pound has moved over 3% against the Australian Dollar buying 1.7050 and over 2% against the New Zealand Dollar at 1.8260 at the time of writing. The GBP/AUD has now arguably established a short-term uptrend with traders suggesting the pair could be approaching January 2017 highs. Analysts are also expecting the GBP/NZD strength to continue with an eventual target of 1.9000 in sight.
USD, EUR, JPY
There was movement back in the US Dollar overnight as commodity currencies weakened on concerns of an oversupply of oil in the market. There was a 4% decline in crude oil prices, causing a slight rally on the DXY to advance to the 100.00 mark, and up 0.3% for the day after hitting a three-week low yesterday. USD/JPY hit an overnight high of 109.20, awaiting further direction from Japanese trade balance figures this morning. The Euro saw little movement overnight as CPI figures came in at 1.5% for the year and minimising any key changes to the ECB rhetoric on policy. EUR/USD cross saw a retest of 1.0700 ahead of the first round of Presidential elections this weekend where it is expected the Euro will be capped on the uncertainty of results in a four-way contest.
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