FX News - May 6 2014: AUD/USD, EUR/USD Rally Today

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The AUD/USD pair rallied today after the release of the Reserve Bank of Australia’s (RBA) monetary policy statement, which announced that it would maintain rates at 2.5 per cent.

In the statement, RBA Governor Glenn Stevens that there have been positive signs of growth in the country’s economy, particularly its employment rate. He added, however, that, “it will probably be some time yet before unemployment declines consistently.”

The most-anticipated part of the statement, however, was about the RBA’s sentiments on the aussie. Mr Stevens said that its value remained high by historical standards, but lacking was the stronger choice of words that led to an immediate decline in the aussie’s value in the past. Because of that, the AUD/USD spiked briefly at 0.9316 just after the release of the statement, before dropping quickly to 0.9271. It has, however, made a steady recovery prior to the opening of the European session. It is currently trading at 0.9302, with initial resistance seen at 0.9282, followed by 0.9306. Meanwhile, initial support is at 0.9243, followed by 0.9219.

In Europe, better than expected data from several European countries helped trigger a bull run that brought the EUR/USD pair past the 1.3900 area before the trading session opened in the region. Unemployment Change in Spain in April came out at -111.6K versus the -49.1K expected, while the Marikit Services PMI in April came out at 56.5 in Spain (versus 54.4 expected), 51.1 in Italy (versus 50.4 expected), 50.4 in France (versus 50.3 expected), 54.7 in Germany (versus 55.0 expected), 58.7 in the United Kingdom (versus 57.6 expected), and 53.1 in the European Union, as expected.

The EUR/USD pair opened the Asian session at 1.3874, before making a sharp rise before the European session opened. It peaked at 1.3931, and is currently trading at 1.3920. Initial resistance for the pair is at 1.3881, followed by 1.3916. meanwhile, initial support is at 1.3858, followed by 1.3823.

By FX Strategy Team, Published on 6th of May 2014
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