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High CPI reading boosted the AUDUSD

Yesterday was a bit whippy day for US stocks after manufacturing data came in almost line with expectations. Today the AUDUSD rally showed the bulls are still in keen to buy the riskier markets. Australian dollar got a boost from higher than expected y/y CPI reading (8.4% vs. 7.6% expected). DJ ended the day higher after the S&P manufacturing PMI was confirmed a tad higher than forecasted (46.8 vs. 46.00 expected). The bullishness in DJ didn’t help Nasdaq though as the market had already rallied to the 11 900 resistance and needed a break. All in all the US stock markets are still bullish based on their 4h and 8h charts. The same goes with Gold and AUDUSD (and EURUSD). Gold and Euro continue to benefit from the weakening dollar.

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CPI release boosted AUDUSD

AUDUSD rallies following the CPI data release and remains bullish above 0.7063. Below the level, we might see the pair trading down to 0.6995. The next major resistance level is a weekly high from August last year (0.7136). Note that the bull channel high and the resistance level coincide in the same area.


Manufacturing data lifts DJ

DJ trends higher in the 4h chart and remains bullish above 33 380. Below the level, the market probably trades down to 33 227. The nearest resistance area is at 33 800 – 33 880. After an initial dip the market found buyers. The positive manufacturing data helped to keep the market bid for the rest of the NY session.


NAS lost momentum at resistance

NAS lost momentum yesterday after the market hit the 11 900 resistance level. Now the next key support is at 11 690. Below the level, the market might trade down to 11 550.

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FTSE trades at support

FTSE trades right at the 7720 – 7732 support area. The market is bullish above this level and below it FTSE probably trades down to 7690. The next resistance to pay attention to is the 7810 level while the next major resistance is at 7875.

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Gold remained bullish

Gold still trades in a wedge but the higher daily lows suggest that the wedge formation could be resolved to the upside. The market remains bullish above 1896. Below the level, it could trade down to 1866 or so.


EURUSD bounced from the channel low

EURUSD bounced from 1.0835 yesterday (I hope you made some money from this bounce!) and remains bullish above 1.0826. If the low of a minor bull channel breaks the market probably trades down to 1.0766. The resistance area, 1.0927 – 1.0940 is created by the long-term channel high and the latest high in the current trend.

The Next Main Risk Events

  • EUR German IFO Business Climate
  • CAD BOC Monetary Policy Report
  • CAD BOC Rate Statement
  • CAD Overnight Rate
  • CAD BOC Press Conference
  • USD Advance GDP 
  • USD Core Durable Goods Orders
  • USD Durable Goods Orders 
  • USD Unemployment Claims
  • USD New Home Sales
  • USD Core PCE Price Index
  • USD Pending Home Sales
  • USD Revised UoM Consumer Sentiment

For more information and details see the TIOmarkets economic calendar.  

Trade Safe!

Janne Muta
Chief Market Analyst

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