The US dollar is gaining momentum. Since the start of the week, it was clearly gaining value as the counter currencies of AUD and EUR gave way.
Looking at the AUD/USD hour chart above we noted that the currency pair is approaching the strong support region of 0.7. Significant support should be expected.
The Australian GDP came in lower than expected. It was reported to be 0.2% instead of the expected 0.5%. As a fundamental indicator of economic health the GDP carries heavy weight. Sentiments were probably significantly affected.
Looking at the EUR/USD hour chart above we noted that the currency pair is on a slide since the start of the week. It is currently testing the support of 1.13.
With the Asian markets dovish due to worst than expected China figures, it is likely that this contagion is spreading.
More Data To Be Released
The week ahead is still packed with economic events and data releases. We have the Australian retail sales, European Central Bank interest rate event and the US Non-Farm Payroll among many others. Any unexpected result of a positive nature may breathe in fresh demand for the AUD and EUR as risk appetite picks up.
Price Action Bias Signals Validates
Both bearish currency pairs are indicated as such in our proprietary Price Action Bias Signals. Based on various factors, any price action for these two pairs may have a slight bias towards the downside. This is a good example of how we can use various signals to enhance our forex trading. Members can log in to their dashboard for the latest signals.