The Eurozone is printing its GDP numbers today.
Will the reaction be enough for EUR/AUD to break above a key resistance level?
Take a look at today’s late U.S. and early Asian session headlines if you’re planning on putting on trades in the next couple of hours:
- Trump bans U.S. investments in firms linked to Chinese military
- U.S. starts fiscal 2021 with 111% jump in October deficit
- U.S. crude inventories rise unexpectedly, fuel draws down -EIA
- Fed, ECB heads give COVID-19 vaccine cautious welcome
- America needs another stimulus package, can’t rely on vaccine, says Fed Reserve Chief
- Post-pandemic Canada must set sights higher to boost growth: BoC’s Wilkins
- New Zealand manufacturing activity slowed in October
- New Zealand food prices climb 2.7% on year in October
- Asian stocks fall as virus spread accelerates
- Yen bounces as vaccine boost fades
- Australia, New Zealand dollars slip on risk aversion, bonds gain
Upcoming Potential Catalysts on the Economic Calendar:
- Germany’s wholesale prices at 7:00 am GMT
- Switzerland’s PPI at 7:30 am GMT
- German Bundesbank President Weidmann to give a speech at 10:00 am GMT
- Eurozone’s flash employment change at 10:00 am GMT
- Eurozone’s Q3 flash GDP at 10:00 am GMT
- Eurozone’s trade balance at 10:00 am GMT
- U.S. PPI numbers at 1:30 pm GMT
What to Watch: EUR/AUD
If you thought that EUR/AUD would find support at the 1.6150 inflection point, then EUR…ight.
EUR/AUD is now about 200 pips from the support, which is also above the 200 SMA on the 1-hour time frame.Will the Eurozone’s GDP release extend the euro’s upswing against the Aussie? Word around is that any strength would be discounted as traders continue to worry about the impact of rising coronavirus cases and fresh lockdown measures on Q4’s economic activity.
The Aussie doesn’t have a brighter prospect though. Aside from global growth concerns weighing on high-yielding currencies like AUD, China’s latest bans on Australian products should also limit the Aussie’s gains.
If today’s Eurozone data releases highlight the euro’s “safe-haven” -ish status in the European region, then EUR/AUD could break above the current area of interest to retest the 1.6500 previous resistance level.
Meanwhile, euro bears can look out for weak EZ numbers weighing on the common currency, or a round of profit-taking that could keep the 1.6350 resistance intact and drag EUR/AUD back down to the 1.6250 area.