EURUSD hit our T1 zone yesterday and the decline against the dollar continued after the news broke out that the UK and EU are likely to miss their mid-November target for Brexit negotiations. This also triggered a correction in Cable as we suggested in yesterday’s Price Action Analysis video. This weakness in Sterling continues today with several major currencies gaining against it. UK GDP numbers disappointed today as they missed the analyst consensus expectation by 0.4% (1.1% vs. 1.5% expected). Other macroeconomic data today include the US inflation numbers and US unemployment claims. We also have the heads of ECB, BOE and Fed speaking today. By reading further you agree with our disclaimer at the bottom of this page and acknowledge that we do not provide investment advice.

We pointed out yesterday also that NZDUSD was approaching a key resistance level at 0.6938. We said  that it’s safe to assume that the resistance is an important psychological level and likely to cause profit-taking and noted how the pair was already losing some momentum. NZDUSD indeed ran into a resistance and turned lower from 0.6914. Both AUDUSD and NZDUSD have lost momentum yesterday and today. The support levels the pairs are trading at the time of writing this are 0.7252 (AUDUSD) and 0.6861 (NZDUSD). NZDUSD has a support reasonably close but the AUDUSD doesn’t. Therefore a break below the support in AUDUSD  could lead to a deeper correction.

AUDUSD has been making lower highs and forming a triangle formation with the lower end of it being the key for the direction of price moves today. If this level breaks we believe it likely that the pair will move to our T1 zone at 0.7193 – 0.7218. The 38.2% retracement level and a range high coincide at this range. The next target zone can be found at 0.7144 – 0.7168. For more analysis on this and many other markets, you may want to subscribe to TIOmarkets YouTube channel.

Recent macroeconomic data releases

  • Federal Funds Rate <0.25%, <0.25% expected
  • Canadian Employment Change 83.6K, 59.0K expected
  • Canadian Unemployment Rate 8.9%, 9.0% expected
  • US Average Hourly Earnings 0.1%, 0.2% expected
  • US Non-Farm Employment Change 638K, 595K expected
  • US Unemployment Rate 6.9%, 7.7% expected
  • New Zealand Official Cash Rate 0.25%, 0.25 expected
  • RBNZ Monetary Policy Statement
  • RBNZ Press Conference

Macroeconomic data releases today

  • US CPI 0.1% expected
  • US Core CPI 0.2% expected
  • US Unemployment Claims 730K expected
  • ECB President Lagarde Speaks
  • BOE Governor Bailey Speaks
  • Fed Chair Powell Speaks

You may access the times and dates in the economic calendar here.

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Janne Muta
Chief Market Analyst
TIOmarkets.com

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