Good morning,
Another quiet Asian session overnight with the only real movement of note being in the AUD and NZD, much to do with the RBA minutes which indicated that they are prepared to take a measured approach in this rate hike cycle (which was evidenced in their Feb pause and move in Mar). The AUD came off accordingly on the news but still managed to hang onto recent gains bottoming out at the intermediate 0.9120 support level. I’m hearing this morning small stops sitting below that level with better bids coming in around the 0.9080 and 0.9050 levels. The NZD on the other hand managed to hold recent gains and performed best against the JPY. The AUDNZD is finally (albeit slowly) starting to move in the right direction and showing small signs of confirmation. Stops in this cross below the 1.2980 level were taken out last night and more so the market feels like it’s moving form net long the cross to at the very least neutral.
Everything else in the realm of the majors was lackluster to say the least as the ranges that prevailed in the European session held steadfast through the Asian session. The market is indecisive at the moment and looking to follow a first mover. Problem being though that no one wants to be that first mover. So today we wait for yet more headlines out of the Euro meeting and more importantly later tonight the FOMC decision. Clearly no one is expecting a move on rates in the US but with the DXY in a precarious spot any change to the rhetoric mumbled by our man Ben will see greater greenback buying and likely send the EURUSD to the lower end of the recent 4 figure range.
The Cable continues to be the whipping boy of favor presently and this morning was sold in strength by a good German name and then everyone else came to the party. As I wrote yesterday I thought I would have a cleaner view of the cross after yesterday’s close but alas no such joy and I remain a little cloudy on where and how. In moments of doubt though I still rely on the 1.5200 level as a good place to start scaling into strategic shorts.
I remain bullish the USDCAD and look to buy dips and scale into fresh longs both here and a little lower all the way into 1.0110/20 looking for corrective retracements into 1.0280 and 1.0350. Keep an eye on the oil price and more importantly what I feel is likely to be a “gold falling out of bed” event.
The countdown continues…. 1 more comment, 1 more day….
Best regards,
Ken Veksler.
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