During the course of the session on Tuesday, we did the Australian interest rate announcement, and then the Core PCE numbers coming out of the United States. Because of this, we could get a little bit of action during the day.
AUD/USD
The Australian dollar will certainly move during the day, especially with any type of surprise coming out of the Reserve Bank of Australia. With this being the case, expect quite a bit of volatility but the market could very well find itself going back and forth as we see traders adjusting they are expectations for interest rates. At this point, the 0.74 level below looks to be very supportive, while the 0.77 level above seems to be very resistive.
USD/CAD
This has been a fairly steady uptrend in this market but we have been grinding higher, not shooting straight up in the air. Because of this, the pair should continue to go higher, given enough time. Ultimately, this is a market that looks like the call buyers are ready to get involved again and again. Also, keep in mind that the Canadian dollar is highly sensitive to the oil markets, which have been looking very soft.
The German index initially tried to break out during the day on Monday, but turned around to form a shooting star. With this, it’s very likely that put buyers will be encouraged, and we could see the market drift lower because of that. However, keep in mind that over the longer term there is most certainly quite a bit of bullish pressure underneath.
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