What is behind recent AUD, CHF volatility?

Eliman Dambell Sayvio AI

EUR/AUD

The Australian Dollar was one of the biggest movers on the FX dashboard, as Westpac stated that a rate cut by the Reserve Bank of Australia could be a few weeks away.

Speculation surrounding a potential rate cut on October 6th, increased volatility levels in AUD trading, with the likes of GBPAUD, AUDJPY and AUDCAD all experiencing big moves. However it was EURAUD which was yesterday’s most notable shifter. This comes as the ECB General Council Meeting commenced yesterday, where the bank continues to discuss some of the Euro area’s most concerning economic battles. COVID-19 cases within the continent are also on the rise once again, with Madrid and Lyon some of the major cities set to impose regional lockdowns.

EURAUD was up close to 84 pips as of writing, rising to its highest level since June 11th. This move was spurred after a breakout from the recent resistance of 1.6362. The pair had previously been consolidating within the support of 1.6183 and the resistance level stated above for the past three and a half weeks. Now that the 10 and 25 EMAs have taken off, do you expect further highs before the week ends today?

4H Chart via Tradeview Markets

USD/CHF

As the Swiss National Bank interest rate decision and monetary policy meeting took place yesterday, traders were looking at CHF for potential intraday trading opportunities.

In particular, USDCHF captured the imagination of speculators as Thursday also saw the release of US Initial Jobless Claims, a release which is now one of the most watched economic indicators for traders. As expected, the SNB kept rates unchanged at -0.75%, however it was the unexpected increase of jobless claims which provided the majority of volatility in this pair.

As of writing, USDCHF was up close to 40 pips, after breaking out of its long term resistance of 0.9184 on Tuesday. The pair has since climbed to its highest level since July 23rd as a result of this weeks’ bullish sentiment. Now trading at 0.9269, many wait to see if the 10 and 25 EMAs will begin to change their current upwards course. If that does happen, what rate do you believe we should expect this pair to trade at?

4H Chart via Tradeview Markets

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Author

Eliman Dambell

Sayvio AI

With over a decade in financial markets, Eliman brings an experienced and diversified point of view to market analysis. He covers current and historical macro trends to give insights on Metals, FX, Stocks, and Crypto.

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