FX News - September 16: EUR, AUD Gets Boost Vs USD

FX Strategy Articles > FX Trading Tips

The EUR/USD pair received a major boost today after Larry Summers withdrew from the running for Fed chairman.

In his statement, Mr Summers said that, "I have reluctantly concluded that any possible confirmation process for me would be acrimonious and would not serve the interest of the Federal Reserve, the Administration or, ultimately, the interests of the nation's ongoing economic recovery."

This left Janet Yellen as the main contender for the position, which would replace outgoing Fed chairman Ben Bernanke. Ms Yellen is currently vice-chairperson of the Fed. Because of this unexpected development, traders put on a bearish stance on the USD, leading to a boost in the EUR/USD pair.

Earlier today, the EUR/USD pair went as high as 1.3381, before leveling off at around the 1.3350 level. The pair is currently trading at 1.3358, with initial resistance seen at 1.3308, followed by 1.3341. Meanwhile, initial support is at 1.3239, followed by 1.3206.

Aside from the EUR/USD, the AUD/USD pair also reacted positively to the news of Mr Summers' withdrawal. This lifted the pair to just below 0.9400. The pair managed to reach a high of 0.9391 in today's trading before leveling off at the 0.9340 region. It is currently trading at 0.9348. The pair is enjoying at the moment the highest levels it has been since June this year.

After this announcement, the main drivers for the pair in the coming days would be the RBA meeting's minutes (September 17, 1:30 AM, GMT), and the series of FED events on Wednesday (September 18, 6:00 PM, GMT), including the interest rate decision and the Federal Open Market Committee (FOMC) Economic Projections.

Initial resistance for the AUD/USD pair is at 0.9260, followed by 0.9283. Meanwhile, initial support is at 0.9207, followed by 0.9184.

By FX Strategy Team, Published on 16th of September 2013
eTorro - Trading Starts Here

Start Trading Forex with up to $10,000

  • 100s Videos and FX Strategy articles
  • Advice from our FX traders
  • Practive free with using real time