Day three: our EUR/USD trade

I continue to focus on EUR/USD downside, although my preference is for a rebound to work offers into.

The AUD has taken over as the currency of choice from traders to short, with RBA member Guy Debelle talking down the currency yesterday. AUD/USD has closed below the 55-day moving average, which has been a good pre-cursor to future price direction since early 2013. The year’s uptrend has also given way yesterday and again this could be telling.

The FOMC minutes from the April meeting will be in play at 04:00 AEST, however given the actual statement was largely unchanged from the March statement and it promises to be a fairly drab affair. We also get speeches from Fed members Janet Yellen, Esther George and Narayana Kocherlakota and their views on policy could have ramifications on oversold bond yields and subsequently the USD. It’s worth bearing in mind that Fed chairman Janet Yellen spoke last week so it’s doubtful that she will express a new view.

IG Charts

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