AUD: AUD/USD Testing 0.6560 Resistance
The AUD/USD had a range Friday night of 0.6521-0.6559, Asia is trading around 0.6545. The AUD extended its grind higher on Friday. The AUD is consolidating above 0.6500 and is looking to test the pivot toward 0.6560-80 within its wider 0.6350-0.6700 range. In the Asian session, I suspect dips on the day back toward 0.6490-0.6510 continue to remain supported, a sustained break above 0.6560-80 area is needed to potentially signal a move toward the top-end of its range, first target would be 0.6625 and then the 0.6700 area.
- (Bloomberg) -- Australian home prices extended gains in November as demand continued to outstrip supply, a dynamic that could add to inflation pressures and keep the country’s central bank from cutting interest rates further. The Home Value Index jumped 1.0% following a 1.1% gain in October, property consultancy Cotality said on Monday.
- MNI BRIEF: China November Manufacturing PMI Remains Below 50. China's Manufacturing Purchasing Managers Index rose by 0.2 points to 49.2 in November from October, remaining below the breakeven 50 mark for the eighth month.
- Options : Closest significant option expiries for NY cut, based on DTCC data: 0.6400(AUD445m), 0.6425(AUD444m), 0.6550(AUD521m). Upcoming Close Strikes : 0.6490(AUD710m Dec 4) - BBG
- The AUD/USD Average True Range for the last 10 Trading days: 36 Points
- Data/Event: S&P Global Australia PMI Mfg, Melbourne Institute Inflation, ANZ-Indeed Job Advertisements
Fig 1: AUD/USD spot Daily Chart
Source: MNI - Market News/Bloomberg Finance L.P
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AUDUSD TECHS: Testing Support At The 50-Day EMA
- RES 4: 0.6707 High Sep 17 and a bull trigger
- RES 3: 0.6659 2.0% 10-dma Envelope
- RES 2: 0.6644 76.4% retracement of the Sep-Oct bear leg
- RES 1: 0.6618 High Oct 29
- PRICE: 0.6537 @ 16:24 GMT Oct 31
- SUP 1: 0.6533 Low Oct 30
- SUP 2: 0.6493 Low Oct 24
- SUP 3: 0.6440 Low Oct 14
- SUP 4: 0.6415 Low Aug 21 / 22 and a key support
A bull cycle in AUDUSD remains intact and Wednesday’s fresh high reinforces current conditions. The break higher signals scope for 0.6629, the Sep 30 and Oct 1 high. Clearance of this level would strengthen the bullish condition. Note that support at 0.6545, the 50-day EMA, has been pierced. A clear break of the EMA would undermine the current bullish phase. For now, the latest pullback appears corrective.
EURJPY TECHS: Bull Cycle Extension
- RES 4: 180.37 1.500 proj of the Jul 31 - Sep 29 - Oct 2 price swing
- RES 3: 180.00 Psychological round number
- RES 2: 178.94 1.236 proj of the Jul 31 - Sep 29 - Oct 2 price swing
- RES 1: 178.82 High Oct 30
- PRICE: 177.73 @ 16:23 GMT Oct 31
- SUP 1: 176.42 20-day EMA
- SUP 2: 174.77 50-day EMA
- SUP 3: 173.92 Low Oct 6 and a gap high on the daily chart
- SUP 4: 173.24 High Oct 3 and a gap low on the daily chart
The trend structure in EURJPY is bullish. The cross traded to a fresh cycle high on Thursday, confirming once again, a resumption of the primary uptrend. Sights are on 178.94 next, a 1.236 projection of the Jul 31 - Sep 29 - Oct 2 price swing. Moving average studies remain in a bull-mode position, highlighting a dominant uptrend. Initial support to watch lies at 176.42, the 20-day EMA.
US TSYS: Early Risk-Off on Venezuela Attack Plans Denied by Pre Trump
- Treasuries look to finish mixed Friday, curves modestly steeper after bonds tracked moves in Bunds earlier in the session: German Bunds retreated, 5s30s curve steepened likely tied to Dutch pension fund transition to new contribution system news.
- Currently, the Dec'25 10Y contract trades +.5 at 112-23 (112-17.5 low/-27 high), the contract needs to trade above 113-18+, the Oct 28 high to signal a possible bullish reversal. 10Y yield -.0040 at 4.0930%.
- Earlier risk-off followed Miami Herald headlines announcing Pres Trump's decision to launch attacks on Venezuelan military sites "linked to drugs ... at any moment". Trump later denied imminent attacks when speaking to reporters on Air Force One.
- The flurry of USD selling ahead of and across the WMR month-end fixing window appears to have stalled the upward momentum for the greenback on Friday, with the USD index now settling just above yesterday’s highs around 99.75 as we approach the weekend close.
- Potential month-end portfolio rebalancing another factor for swings in rates & stocks earlier.
- WTI has regained ground in a day where Trump headlines have sparked volatility. The latest rally appears to be driven by news that the Pentagon has greenlit the US providing long-range Tomahawks missiles to Ukraine, which would be a sign of the US taking a harder stance against Russia.
