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Antipodean FX Relinquish Monday Gains, US Data Awaited

FOREX
  • EURUSD has had a brief bout of strength to session highs following the broadly in line Eurozone CPI data. The pair printed up to 1.0727, however, momentum has been subdued as we break above a narrow overnight range.
  • Solid gains for the USD index overnight have been eroded in early European trade, although the DXY remains 0.15% in the green as we approach the NY crossover.
  • USDJPY has climbed, but has yet to reclaim the 157.00 level. We were last near 156.90, around 0.35% weaker in yen terms. The market is testing the waters post yesterday's strong rebound amid intervention speculation. Earlier comments from Chief FX Diplomat Kanda reiterated the authorities are ready to deal with FX at any time of the day. Mixed Japan data outcomes didn't shift FX sentiment.
  • Weaker-than-expected data overnight has weighed on both the Australian dollar and Kiwi, placing a temporary halt to the bullish developing sentiment for AUDUSD. However, the current bullish phase for the pair remains intact despite today’s pullback. Furthermore, signs of expedited easing and bond issuance in the latest Politburo report should be AUD supportive at the margin.
  • Overall, resistance at 0.6528, the 50-day EMA, has been breached and the clear break highlights a stronger reversal that signals scope for a climb towards 0.6644, the Apr 9 high. Initial support comes in at 0.6441.
  • Later US Q1 ECI, February house prices, April MNI Chicago PMI and consumer confidence all print ahead of Wednesday’s Fed decision and Friday’s employment report. Canadian GDP for February is also scheduled on Tuesday.
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  • EURUSD has had a brief bout of strength to session highs following the broadly in line Eurozone CPI data. The pair printed up to 1.0727, however, momentum has been subdued as we break above a narrow overnight range.
  • Solid gains for the USD index overnight have been eroded in early European trade, although the DXY remains 0.15% in the green as we approach the NY crossover.
  • USDJPY has climbed, but has yet to reclaim the 157.00 level. We were last near 156.90, around 0.35% weaker in yen terms. The market is testing the waters post yesterday's strong rebound amid intervention speculation. Earlier comments from Chief FX Diplomat Kanda reiterated the authorities are ready to deal with FX at any time of the day. Mixed Japan data outcomes didn't shift FX sentiment.
  • Weaker-than-expected data overnight has weighed on both the Australian dollar and Kiwi, placing a temporary halt to the bullish developing sentiment for AUDUSD. However, the current bullish phase for the pair remains intact despite today’s pullback. Furthermore, signs of expedited easing and bond issuance in the latest Politburo report should be AUD supportive at the margin.
  • Overall, resistance at 0.6528, the 50-day EMA, has been breached and the clear break highlights a stronger reversal that signals scope for a climb towards 0.6644, the Apr 9 high. Initial support comes in at 0.6441.
  • Later US Q1 ECI, February house prices, April MNI Chicago PMI and consumer confidence all print ahead of Wednesday’s Fed decision and Friday’s employment report. Canadian GDP for February is also scheduled on Tuesday.