Asian Session Forex Recap – Apr. 21, 2015

  • RBA Gov Stevens: AUD “very likely” to fall
  • RBA minutes: Further policy easing may be appropriate
  • German and euro zone ZEW economic sentiment index up for release

What a wipeout for the Aussie! Following RBA Governor Stevens’ downbeat comments during the U.S. session, the RBA minutes confirmed that further easing may be appropriate in the coming months. This had several forex analysts and economic hotshots speculating that the Australian central bank might cut interest rates in May!

Policymakers highlighted the sharp drop in iron ore prices, which might drag mining investment much lower. In addition, RBA officials expressed concern about seeing below-trend GDP growth for the first quarter, although they also mentioned that they’re inclined to wait for more data before making another easing move.

It’s no surprise that the Aussie is weaker across the board, with AUD/USD tumbling below the .7700 mark (-0.36%) and AUD/JPY breaching support at 92.00 (-0.13%). The Australian currency also chalked up losses to the euro and pound, sending EUR/AUD up by 45 pips (+0.33%) and GBP/AUD higher by 58 pips (+0.3%) so far.

No other top-tier reports were released in the past few hours, but other forex pairs didn’t pass up the chance to recover from their risk-off moves. Yen pairs are in the green, with EUR/JPY enjoying a 30-pip gain (+0.24%) and GBP/JPY advancing by 31 pips (+0.19%) to the 178.00 mark.

Will forex traders continue to stay upbeat in the upcoming London trading session? Germany and the euro zone are set to print their latest ZEW economic sentiment figures and possibly indicate a pickup in optimism. In particular, Germany’s index probably improved from 54.8 to 55.6 this month while the region’s index might’ve ticked up from 62.4 to 63.7.

Don’t rule out a downside surprise though, as the unfolding of the Greek debt drama weighed on economic sentiment recently. Speaking of Greece, make sure you keep close tabs on news updates on this issue since it could also have a significant impact on risk appetite. Any mention of the D-word (default) or the G-word (Grexit) could send the shared currency tumbling once more!

U.S. Session Recap

Bonnie and Clyde, peanut butter and jelly, Justin Bieber and his hair. Some things just go well together.

In forex trading, you get better odds at securing pips when your fundamental analysis is complemented by technical analysis. Head on to Big Pippin’s Daily Chart Art for some pip-locking technical setups!