Market Snapshot:
AUD: The Dollar rallied on the back of positive Chinese Trade Balance Data today to see it near 5-week highs. We await Australian employment tomorrow at 11:30 AEDT to see if we can break above the 0.908 highs.
EUR: Draghi talks in Brussels today on "Progess Through Crisis"
GBP: BoE Governor Mark Carney speaks today with the inflation report.
CHARTS OF THE DAY:
EUR/USD: Shooting Star Reversal suggests near-term weakness
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The decline from 1.39 high has been choppy at best, but yesterday's reversal candle beneath a resistance confluence does favour at least a run back down to 1.358. Usually I would not put too much emphasis upon one candle however the fact we can see clear cycles evolving and that we failed to close above the Monthly R1 it does put a downside move as more probable.
How price reacts at 1.358 will provide further clues - if this level holds then an attack at the 1.368 highs is on the cards (and potential upside break out of the current correction). Howevr last time we visited this level we did not hang around too long. Under this scenario then 1.350 is the next likely target. Within a bullish channel and teasing 1300
GOLD: Within a bullish channel and teasing 1300
1278 was an important level for the bulls to overcome which was achieved yesterday following Yellen's first testimony. Due to the momentum it broke above this level I favour an eventual target of 1300 and 1307, however we may need to allow for a retracement towards 1278 buy zone before this eventual run.
Something we can do ti aid the analysis is also follow AUDUSD alongside Gold. These 2 markets are correlating very closely at present so to have greater confidence in any upside movement we would want to see both markets trading in tandem. However as the USD is showing signs of near-term strength we may well see a pullback prior to the next up leg on Gold and AUDUSD.