ECB Sparks Euro Relief Rally- AUD Weakness in Focus Ahead of NFP
Talking Points:
- EUR/USD Relief Rally to Gather Pace as ECB Buys More Time.
- AUD/USD Risks Further Losses as RSI Dips Back Into Oversold Territory.
- USDOLLAR Remains Overbought Ahead of Non-Farm Payrolls (NFP) Report.
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EUR/USD
Chart - Created Using FXCM Marketscope 2.0
- EUR/USD squeezes higher as European Central Bank (ECB) fails to deliver new round of monetary stimulus; bullish engulfing pattern may highlight larger relief rally for euro.
- Nevertheless, long-term outlook remains bearish as price & the Relative Strength Index (RSI) retain the downward trends; will watch former support around 1.2610-20 (61.8% expansion) for new resistance.
- DailyFX Speculative Sentiment Index (SSI) shows retain crowd remains net-long EUR/USD following the ECB meeting, with the ratio currently standing at +1.09.
AUD/USD
- AUD/USD continues to test channel support as it slips to a fresh monthly low of 0.8354; downside targets remain favored as the RSI appears to be pushing back into oversold territory.
- Despite the Reserve Bank of Australia’s (RBA) pledge for a period of interest rate stability, seeing growing bets for a rate cut in 2015 following the dismal 3Q Gross Domestic Product (GDP) report.
- Will retain the approach to sell-bounces in AUD/USD, with the next downside region of interest coming in around the 0.8300-0.8310 (78.6% expansion).
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Read More:
Key EURUSD Scalp Targets Heading Into ECB / NFPs
Gold Stalls Near Key Resistance After Largest Rally in Over 2 Years
USDOLLAR(Ticker: USDollar):
|
Index |
Last |
High |
Low |
Daily Change (%) |
Daily Range (% of ATR) |
|
DJ-FXCM Dollar Index |
11406.68 |
11452.62 |
11392.25 |
-0.24 |
114.80% |
Chart - Created Using FXCM Marketscope 2.0
- Dow Jones-FXCM U.S. Dollar Index struggling to hold its ground after tagging a fresh monthly high of 11,453, (61.8% expansion); at risk for a larger pullback should the RSI fall back from overbought territory.
- Nevertheless, the highlight anticipated Non-Farm Payrolls (NFP) report may heighten the appeal of the greenback as employment is expected to increase another 230K while wage growth is expected to uptick to an annualized 2.1%.
- Lack of momentum to break above 11,453 (61.8% expansion) may spur a near-term correction, with former resistance around 11,120 (161.8% expansion) to 11,138 (61.8% expansion) in view.
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|
Release |
GMT |
Expected |
Actual |
|
Challenger Job Cuts (YoY) |
12:30 |
-- |
-20.7% |
|
Initial Jobless Claims |
13:30 |
295K |
297K |
|
Continuing Claims |
13:30 |
2318K |
2362K |
|
Fed's Mester Gives Opening Remarks at Conference in Washington |
13:30 | ||
|
Fed's Brainard Speaks on Financial Stability in Washington |
17:30 |
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--- Written by David Song, Currency Analyst
To contact David, e-mail [email protected]. Follow me on Twitter at @DavidJSong.
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