AUDUSD: The Australian dollar ended lower Tuesday amid ongoing worries over Greece’s inability to form a government and a slowing growth outlook for China–Australia’s biggest trading partner.
Traders expect the Australian unit to continue its recent steep slide as investors eschew riskier assets in favor of bonds and the U.S. dollar.
The central bank offered few hints as to its next move, saying the reduction in rates had returned the cash-rate target to “appropriate” levels. Economists continue to expect further cuts, especially as the world environment sours again.
We expect a range for today in AUDUSD rate of 0.9910 to 1.0050 (We bought AUDUSD at 0.9930)
We Bought AUDUSD at 0.9930 (continued to hold)
Stop loss at 0.9860
Target at 0.9980 and 1.0030
EURUSD: Preparing for Greece’s exit from the euro has moved from abstract to inevitable for many currency traders.
Funds are increasing cash positions, ramping up trades that take advantage of an expected rise in volatility and shedding counterparty relationships with firms that could have exposure to a Greek exit.
Greece’s latest failure to form a new government on Tuesday has more investors convinced Greece will simply opt out of the currency bloc altogether.
We expect a range for today in EURUSD rate of 1.2680 to 1.2760
STAND ASIDE
USDJPY: U.S. Republican lawmakers Tuesday tabled a set of bills that would curtail new financial regulations, after a more than $2 billion trading loss at J.P. Morgan Chase & Co. (JPM) was widely seen as bolstering the argument in Washington for stricter oversight of Wall Street.
One of the bills proposed changing part of the law that would require banks to separate trading desks that trade in complex derivatives called “swaps” from the rest of the federally backed bank. Another bill would restrict the international reach of U.S. regulators in the derivatives markets.
We expect a range for today in USDJPY rate of 79.80 to 80.50 (We missed out a ride where we set our limit at 79.50)
STAND ASIDE
