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Overview: What was expected to be a quite Monday session, with the US bank holiday, actually saw some wide price
action as atrocities in the Middle East sparked a risk off gap at the start of the day before a solid recovery as the day
went on. At the close oil is still 5% higher, gold up 1.5% and the S&P 500 US equity index is back at 2-week highs. Bond
markets were closed, so it will be interesting to see their reaction when they reopen later today.
AUDUSD: The AUDUSD trading just above 64c. However, the recovery could well be short-lived as sentiment is still
weak and with US inflation data due later in the week, the market will not want to get too far away from itself. Market
sentiment suggests importers start to look at these levels as healthy for the medium term.
EURAUD: With the Euro remaining flat over the course of the day, the Aussie Dollars recovery sparked a pull back from
technical resistance and we now sit in the middle of the range. The technical indicators point to a retracement back
towards 1.6600 / 0.6025 levels once again.
GBPAUD: Sterling didn’t give quite as much ground back versus the A$, as compared to the Euro, but we are similarly
back in the middle of the range awaiting future direction. This may not come until UK data on Thursday, so believe the
market continues trading either side of 1.9150 / 0.5220 for the short term.
AUDNZD: The Kiwi Dollar caught the same wind that pulled the A$ higher yesterday, and therefore keeping the pair
hugging trend line support on the charts. Expectations are for the technical support should hold firm for A$ buyers,
especially as we head towards this weekend’s NZ general election and an expected changing of the guard.
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