Aussie under a little pressure as Euro might have topped

October 29, 2013

Really quite a boring night when you look around the grounds at the state of play. The only real excitement was in the Ag pits which has become usual lately but elsewhere its either waiting for Apple or waiting on the FOMC later in the week. There is also much talk about about the rise in margin debt on the NYSE and the risk this poses for the market.

So in the end we got a fairly rangy day with no real movement by the close where the Dow was 0.01% lower, the Nasdaq 0.09% lower and the S&P 500 was 2 points or 0.13% higher at 1762.Data wise in the US home sales were disappointing but then that’s to be expected with the recent political uncertainty and the spike in rates – both of which have been corrected.

In Europe the FTSE was up just 0.07% and the DAX fell a similar amount down 0.08%. The CAC however was down 0.48%. Most focus is of course on the massive storm that has buffetted the UK and the west coast of Europe and which likely disrupted trade and kept traders at home.

During overnight trade on the Sydney Futures Exchange the SPI200 still managed to eke out a 2 point gain to 5431 bid, which is remarkable after such a strong gain yesterday.

SPI200 still heading toward resistance and although I’m not overly bearish, as I noted yesterday, the SPI200 still looks to be forming a top around here for a pullback. The resistance is obvious.

On forex markets the Aussie held up reasonable well in Asian trade above 96 cents but has slipped back to 0.9572 for a small loss on the day. It was a similar story for the Euro (1.3793), GBP (1.6148) and USDJPY (97.65). The Fed will be the big catalyst this week for any moves.

Aussie is still biased lower and the technical outlook continues to point lower support was again yesterday and is again today the fast moving average as you can see on the chart below. Indicators are pointing lower however.

The recent high, which was the level for the breakout recently, is key support but a move toward 94.76 seems on the cards.

This is reinforced by what looks like a top forming  and when I look at the Euro it looks like the above and my belief that stocks are on the turn pulls it all together as the Euro looks like it has topped as well – so a reversal of the recent move higher is on the cards as you can see below.

Support – 1.3670

On Commodity markets just when everyone started talking about lower petrol in Australia crude rallied 0.74% and is back at $98.57, Gold was essentially unchanged at $1353, copper closed at $3.26 while the Ags were up to their usual volatile ways with corn down 2.05%, wheat down 1.41% and soybeans dropped 2.21%. Bitcoin’s rally continued and it sits at $208 this morning.

On the data front today RBA Governor Glenn Stevens is talking at 9.30 this morning at an Australian and New Zealand Investment conference. In Japan we get retail trade, India has an RBI decision due while in the US tonight we get PPI, retail sales, Case Shiller house prices and consumer confidence.

Have a great day and good hunting

Greg

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