CPI growth in Australia came in at 0.6% for Q1. The previous quarter’s reading was 0.8%, and so was economists’ forecast for Q1. CPI in Q1 from a year earlier grew 2.9%, missing the 3.2% forecast. The lower than expected inflation data might present a challenge for the RBA to raise rates and thus hampered AUD-strength. The 2.9% rate on the year is within the 2%-3% target for the RBA, so this data should not seriously prevent a rate hike, but in the short-term…

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The AUD and NZD have been strong in 2014. After consolidating in April, these two pairs look like they are in bullish continuation attempts. The 4h chart shows a pair in a falling wedge since tagging 0.9460, the 2014-high so far. Staying above the 0.93 pivot area, traders are pushing AUD/USD above the falling wedge during the 4/22 session. The breakout signals bullish continuation first to challenge the 0.9390-0.94 resistance area, then the 0.9450-0.9460 highs…

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AUDUSD bullish bias intact; late April threat to .9535/40

  • A cautious digestion tone from last week, still holding above a firm foundation at .9305/00 and notably the trend line, now at .9250, to leave bullish pressures intact into latter April.
  • We see bounce risk into midweek to .9425 and for the week through the .9460 peak.
  • We still see the April threat higher to .9535/40 retrace/ chart targets with overshoot risk to .9625/30.
  • WHAT CHANGES THIS?
  • Below .9300 eases bull risks, to neutral through .9250; we only see a shift  to negative below .9205/00.

Please see full report with levels and latest audio-visual analysis here: http://members.marketchartist.com/Daily/AUDUSD.pdf

 Daily AUDUSD

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EUR/USD broke above Friday’s range, which was set during the release of the US NFP. After a directionless Friday session, the Monday session shows bullish decision. The market is bullish in the short-term towards the 1.38 handle ahead of Wednesday’s FOMC meeting minutes. Note that the high from last week is at 1.3820. If the market pushes above that, it will also likely break a falling channel resistance, and give a bullish signal. GBP/USD came off Friday’s consolidation price action…

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EUR/USD edged lower this week, continuing a bearish mode since it retreated from the 1.3966 high in March. The ECB event risk on Thursday weighed on the euro because the ECB remained dovish. When we look a the daily chart , we see that the bearish run in the past few weeks is within a bullish market. There is still downside risk toward the 1.36 handle, where the 200-day SMA looms. However, with the daily stochastic below 20, I would not be surprised if we get a bullish attempt early next week even before 1.36…

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The key event risk today was ECB’s monetary policy statement and the press conference that followed. While the bank announced so change to its policy, it did mention that it had more discussion of QE, and it did expect a prolonged period of low inflation. This basically keeps the hope alive that the ECB will still reduce rates or apply some other method of loosening policy. The market traded down the euro. We saw the EUR/USD crack this week’s low…

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The RBA announced that it will hold the overnight cash rate at the record low of 2.5%. Economists had mostly expected a rate-hold. Glenn Stevens statement pointed out both improvements, and continuing weakness in the economy: The AUD/USD has been bullish going into the release, though it slowed down ahead of it. The 4H chart below shows a bullish market that was trading at a projected channel resistance ahead of the RBA statement. After the statement…

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