Chart of the Day EURAUD
EURAUD Potential Reversal Zone - Probable Price Path
The number of confirmed coronavirus cases in the United States increased by about 50,000 to 3.82 million on Monday, an increase of 1.3% on a daily basis, which is lower than the average increase of 1.9% in the past seven days. Multiple coronavirus vaccines published positive test results on Monday.
The White House stepped up to discuss a new round of stimulus package with congressional leaders. Treasury Secretary Mnuchin said that the scale of the plan may reach trillions of dollars, and will focus on children, employment and vaccines; Senate Majority Leader McConnell is expected to announce the Republican plan this week. Mnuchin will meet with House Speaker Pelosi and Senate Minority Leader Schumer on Tuesday
The U.S. Department of Commerce included 11 Chinese companies on the list of entities on the grounds that they were suspected of violating human rights in Xinjiang, and they would be restricted in obtaining American-origin technology and products
EUR: The EU leaders’ meeting started last Friday was extended to the fifth day. Bloomberg confirmed agreement on a plan proposed by European Commission President Michelle on Monday night, suggesting that 390 billion euros be issued on behalf of the European Commission to be allocated to countries hit by the epidemic in the form of subsidies. This debt will be repaid by the EU joint budget by 2058. Clearly, the size of the subsidy is lower than the 500 billion euros originally recommended by Germany and France; in addition, another 360 billion euros of low-interest loans will be granted to member states.
AUD: The market sentiment improved and short-term support for the Australian dollar performance. The market is watching the outbreak in Australia and the progress of Sino-US relations. The minutes of Australia’s July monetary policy meeting shows that the speed of economic recovery is still highly uncertain, and negative interest rates are still extremely unlikely. Australia's ANZ Consumer Confidence Index fell to 90.7 from the previous value of 91.6 last week
From a technical and trading perspective, the EURAUD remains in a sustained downtrend, trading well below it’s monthly Volume Weighted Average price. With risk on sentiment currently prevalent and the AUD breaking its June highs, the EURAUD has come under renewed pressure, breaking down from its recent triangle consolidation pattern, as such bearish exposure should be rewarded targeting a move to test support down towards 1.59. Only a close back through 1.63 would negate the continuation trade.
Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.
High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73% and 76% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.
Past performance is not indicative of future results.
High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 75% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Futures and Options: Trading futures and options on margin carries a high degree of risk and may result in losses exceeding your initial investment. These products are not suitable for all investors. Ensure you fully understand the risks and take appropriate care to manage your risk.
Patrick has been involved in the financial markets for well over a decade as a self-educated professional trader and money manager. Flitting between the roles of market commentator, analyst and mentor, Patrick has improved the technical skills and psychological stance of literally hundreds of traders – coaching them to become savvy market operators!