AUDUSD: In the 12 months to September, the inflation gauge rose 2.8%–at the upper end of an inflation target band of 2%-3% for Australia’s central bank.
The reading comes just a day before the Reserve Bank of Australia’s monthly policy board meeting. Financial markets are currently pricing in 150 basis points of interest rate cuts over the next year from the RBA, with concerns growing that a slowdown in the non-mining parts of Australia’s economy, coupled with global economic worries and the still unsettled Greece debt situation, will force the bank out of restrictive territory.
So far, the central bank is dismissing those calls, with the RBA expected once again expected to hold rates steady Tuesday and stop well short of preparing markets for the prospect of interest rate cuts.
We expect a range for today in AUDUSD rate of 0.9650 to 0.9750 (We find an opportunity to entry AUDUSD at the current market price 0.9660 ranges. Last week we set entry order at 0.9650.
ENTRY at market price price AUDUSD at 0.9660
Stop loss at 0.9600
Target at 0.9690, 0.9730, 0.9780
EURUSD: Investors still skeptical European officials can rescue Greece before it defaults on its debt and cause bigger problems throughout the euro zone, investors increased their anti-euro bets to $13.95 billion as of Sept. 27. That is the largest net “short” position against the euro since June 8, 2010.
The dollar continued to show its returning status as a global safe haven amid worries in Europe and about the pace of global economic growth as well. The net dollar long position increased 59% from the previous week as more investors bet on major currencies to fall against the dollar or pared back anti-dollar bets.
We expect a range for today in EURUSD rate of 1.3320 to 1.3420 (We prefer to stay out of the market. Those who short the pair earlier shall continue to hold your short. The possible to fall further toward 1.3000 areas.
Limit BUY order for EURUSD at 1.30000
Stop loss at 1.2930
Target at 1.3100, 1.3200, 1.3300
USDJPY: Officials in Beijing have allowed the yuan to appreciate since committing in June 2010 to let the currency climb against the dollar. The yuan has appreciated roughly 6.7% against the dollar on a nominal basis, and around 10% when taking into account higher levels of Chinese inflation.
Previous efforts have been made to move similar measures through the House and Senate, though they have fallen short of being enacted into law. That is in part because of concern among some business groups that China could retaliate against U.S. exports, which currently are one of the few bright spots in an otherwise dour economic landscape.
On the other hand, speculative investors even pared back their views that Japan’s yen is the world’s safest currency, shedding some bets the yen would rise against the dollar. Net “long” positions fell 6% to $6.93 billion.
We expect a range for today in USDJPY rate of 77.00 to 77.60 (As mentioned a last week that the pair likely to reach 80.00 within weeks, therefore we prefer to go long against the Yen.)
Limit BUY order for USDJPY at 76.60
Stop loss at 76.10
Target at 77.20, 77.60 AND possible heading to 80.00
