The reversal for the major pairs may come soon in terms of bearish correction but they rose yet again today against the U.S. dollar slightly, where the euro has surpassed its 1.3500 resistance area and is standing at 1.3516, which is yet another hurdle for it in the way to test 13531 and 1.3546.
The trade balance for the Eurozone for the past month came out to be exactly the same as expected with 14.3 billion, while the current account showed some downward movement hence indicating a slight drop in the exports as compared to imports. However, from an investors’ perspective this data doesn’t really count because the actual effect of an interest rate cut would now be seen in upcoming months where exporters are expected to benefit from rate cut, as their exports would increase.
Provided the pair sustains above 1.3410 it is bullish for the medium term, but once it moves below 1.3463, then the euro may move down to test 1.3449 and 1.3429.
Aussie ditched again?
The Australian dollar, despite its inclination towards downward to 0.9300 area and beneath, rose by around 35 points today where it has now completed its 61.8% bullish correction on a Fibonacci scale of its sharp plunge last week. There is a resistance level at 0.9426, above which buying would become safe, but sellers may try entering the market yet again and bring it back down for a medium term target to test 0.9300 and if breaks below this then go for a long-term target of 0.9000.
As a trader and analyst, I see this as more of a sentimental and psychological move that has overwhelmed the pair, despite good economic indicators for the currency. Even its technical levels show that the pair has more of a bearish inclination but trade what you see at this moment because remarks from the Federal Reserve are the only reason behind this bullish move and has been keeping the major pairs to make their due downward movement.
Aussie investors are eying on the Monetary Policy meeting minutes due early in the Asian session, where interest rate settling may be done again, but this time the chances are that the Reserve bank of Australia may move towards increasing the rate.
To contact the reporter of this story: Jonathan Millet at email@example.com