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AUD/USD Under Pressure as U.S. Dollar Strengthens.

With the U.S. presidential election on the horizon, will we see increased volatility in the AUD/USD pair as economic indicators shift?

The AUD/USD pair is experiencing mild losses, hovering around 0.6605 in early Asian trading, driven by a stronger U.S. dollar and robust economic data. The recent rise in the U.S. Michigan Consumer Sentiment Index to 70.5 for October has added pressure, signaling potential Fed caution ahead.

Read below what our desk thinks, and the important levels to watch this week.

This market brief is an overview of the week ahead and some of the events we see as being important to the markets.

Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes. For up-to-the-minute market analysis see our live trading room.

INDICES

AUSTRALASIA

ASX – 8226 (-112 or -1.34%)

The AU200 shows a moderate bearish trend, with a notable drop from 8338 to 8226, indicating downward momentum this week.

VOLATILITY ALERTS:

Wed 11:30 – AUD CPI (Q3)

Wed 11:30 – AUD RBA Trimmed Mean CPI QoQ (Q3)

Thu 11:30 – AUD Retail Sales MoM (Sep)

For a move to the upside, we must now see this market close above 8246. Should this occur, we will look for a move into 8267, and if the upside momentum is strong, we could see a move higher into 8287 and potentially 8329.

If we cannot close above 8205, we could see a move back to test 8184 before a pause to the downside. A break below this level may result in a sharp move lower into 8164, and any further breaks to the downside may see a bigger move into 8123.

EUROPE

DAX (30) – 19494 (-178 or -0.9%)

The DAX30 shows a notable downward trend this week, with a moderate move from 19,672 to 19,494.

VOLATILITY ALERTS:

Mon 19:00 – EUR Retail Sales MoM (Sep)

Wed 17:30 – EUR GDP Growth Rate QoQ (Q3)

Wed 19:55 – EUR Unemployment Rate (Oct)

For a move to the upside, we must now see this market close above 19541. Should this occur, we will look for a move into 19588, and if the upside momentum is strong, we could see a move higher into 19635 and potentially 19737.

If we cannot close above 19446, we could see a move back to test 19398 before a pause to the downside. A break below this level may result in a sharp move lower into 19351, and any further breaks to the downside may see a bigger move into 19256.

US

S&P 500 – 5834 (-45 or -0.77%)

The US500 is trending downwards with a moderate decline, indicating mild bearish momentum over the past week.

VOLATILITY ALERTS:

Tue 23:30 – USD Goods Trade Balance (Sep)

Wed 23:15 – USD ADP Employment Change (Oct)

Fri 23:30 – USD Non-Farm Payrolls (Oct)

For a move to the upside, we must now see this market close above 5848. Should this occur, we will look for a move into 5863, and if the upside momentum is strong, we could see a move higher into 5877 and potentially 5907.

If we cannot close above 5820, we could see a move back to test 5805 before a pause to the downside. A break below this level may result in a sharp move lower into 5791, and any further breaks to the downside may see a bigger move into 5762.

FOREX

AUD/USD – 0.6606 (-106 or -1.58%)

AUD/USD is showing a moderate downward trend, with a notable pullback this week indicating increasing bearish pressure.

VOLATILITY ALERTS:

Wed 11:30 – AUD CPI (Q3)

Wed 11:30 – AUD RBA Trimmed Mean CPI QoQ (Q3)

Thu 11:30 – AUD Retail Sales MoM (Sep)

Tue 23:30 – USD Goods Trade Balance (Sep)

Wed 23:15 – USD ADP Employment Change (Oct)

Fri 23:30 – USD Non-Farm Payrolls (Oct)

For a move to the upside, we must now see this market close above 0.6622. Should this occur, we will look for a move into 0.6639, and if the upside momentum is strong, we could see a move higher into 0.6654 and potentially 0.6688.

If we cannot close above 0.6590, we could see a move back to test 0.6574 before a pause to the downside. A break below this level may result in a sharp move lower into 0.6558, and any further breaks to the downside may see a bigger move into 0.6524.

EUR/USD – 1.0794 (-73 or -0.67%)

EUR/USD is trending lower with a notable drop, indicating bearish momentum and potential continuation if support levels don’t hold.

VOLATILITY ALERTS:

Mon 19:00 – EUR Retail Sales MoM (Sep)

Wed 17:30 – EUR GDP Growth Rate QoQ (Q3)

Wed 19:55 – EUR Unemployment Rate (Oct)

Tue 23:30 – USD Goods Trade Balance (Sep)

Wed 23:15 – USD ADP Employment Change (Oct)

Fri 23:30 – USD Non-Farm Payrolls (Oct)

For a move to the upside, we must now see this market close above 1.0810. Should this occur, we will look for a move into 1.0847, and if the upside momentum is strong, we could see a move higher into 1.0874 and potentially 1.0919.

If we cannot close above 1.0768, we could see a move back to test 1.0739 before a pause to the downside. A break below this level may result in a sharp move lower into 1.0704, and any further breaks to the downside may see a bigger move into 1.0669.

GBP/USD – 1.2958 (-94 or -0.72%)

The GBP/USD is trending downward with a notable move of 0.0094, indicating bearish momentum in the market.

VOLATILITY ALERTS:

Tue 23:30 – USD Goods Trade Balance (Sep)

Wed 23:15 – USD ADP Employment Change (Oct)

Fri 23:30 – USD Non-Farm Payrolls (Oct)

For a move to the upside, we must now see this market close above 1.2988. Should this occur, we will look for a move into 1.3008, and if the upside momentum is strong, we could see a move higher into 1.3028 and potentially 1.3083.

If we cannot close above 1.2933, we could see a move back to test 1.2908 before a pause to the downside. A break below this level may result in a sharp move lower into 1.2883, and any further breaks to the downside may see a bigger move into 1.2838.

USD/JPY – 153.00 (+345 or +2.31%)

The USD/JPY shows a strong bullish trend with a significant surge of 3.45, indicating impressive upward momentum this week.

VOLATILITY ALERTS:

Thu 14:00 – JPY BoJ Interest Rate Decision

Wed 16:00 – JPY Consumer Confidence (Oct)

Tue 23:30 – USD Goods Trade Balance (Sep)

Wed 23:15 – USD ADP Employment Change (Oct)

Fri 23:30 – USD Non-Farm Payrolls (Oct)

For a move to the upside, we must now see this market close above 153.38. Should this occur, we will look for a move into 153.76, and if the upside momentum is strong, we could see a move higher into 154.15 and potentially 154.91.

If we cannot close above 152.63, we could see a move back to test 152.24 before a pause to the downside. A break below this level may result in a sharp move lower into 151.85, and any further breaks to the downside may see a bigger move into 150.99.

COMMODITIES

GOLD – 2734 (+11 or +0.4%)

Gold is showing strong upward momentum with a significant rise of 11 points this week, indicating bullish market sentiment.

For a move to the upside, we must now see this market close above 2738. Should this occur, we will look for a move into 2747, and if the upside momentum is strong, we could see a move higher into 2756 and potentially 2764.

If we cannot close above 2729, we could see a move back to test 2720 before a pause to the downside. A break below this level may result in a sharp move lower into 2711, and any further breaks to the downside may see a bigger move into 2702.

CRYPTOS

BITCOIN – 68084 (-996 or -1.44%)

Bitcoin is trending down this week, showing a notable drop of 996 points.

For a move to the upside, we must now see this market close above 68181. Should this occur, we will look for a move into 68378, and if the upside momentum is strong, we could see a move higher into 68575 and potentially 68810.

If we cannot close above 68056, we could see a move back to test 67890 before a pause to the downside. A break below this level may result in a sharp move lower into 67793, and any further breaks to the downside may see a bigger move into 67564.

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