The EUR/USD pair initially tried to rally during the beginning of the session on Monday, but turned back around and fell back into the consolidation area. The 1.3350 level offered support though, and as a result it looks like the market is going to continue to go back and forth during the course of the next couple of sessions. With that, we are not necessarily willing to put any money into this marketplace, as it simply looks like it’s going to be far too tight in the meantime. If we get below the 1.33 level, we could fall apart.
The GBP/USD pair gapped higher at the open on Monday, and then simply sat there. We clear the 1.67 handle, and as a result we believe that this market will go higher. The 1.68 level is resistance though, so we do not expect that to be an easy barrier to break above. Ultimately, we feel that this market breaking above there probably leads to the 1.70 level, and then possibly 1.72. On the other hand, if we break down below the recent low, we could very well fall apart and head to the 1.65 level.
The AUD/USD pair as you can see went back and forth during the course of the day on Monday, continuing to show the 0.93 level is an area where the buyers could step back into the marketplace. We feel that this market will more than likely continue to be consolidated of on the longer-term charts, as we should go to the 0.9450 level. On the other hand, if we break down below the 0.92 level that would be enough for us to start selling this market as it would be a significant breakdown.
The USD/JPY pair initially fell during the course of the session on Monday, but found enough or below in order to bounce and go higher. The resulting hammer does suggests that the markets get ready to go higher, but the 103 level above should continue to be resistive. With that, a break above the 103 level is in fact a strong sign, as the market should go higher at that point. On the other hand, if we break down from here we believe that the 102 level will be supportive, and certainly believe that the 101 level will be as it is the bottom of the large timeframe consolidation area.
Data Update for 19th Aug 2014
|4:15am||NZD||PPI Input q/q||0.70%||1.00%|
|NZD||PPI Output q/q||0.80%||0.90%|
|7:00am||AUD||High||Monetary Policy Meeting Minutes|
|8:30am||NZD||Inflation Expectations q/q||2.40%|
|GBP||PPI Input m/m||-0.80%||-0.80%|
|GBP||Core CPI y/y||1.90%||2.00%|
|GBP||PPI Output m/m||0.10%||-0.20%|
|USD||High||Core CPI m/m||0.20%||0.10%|