RBA stands pat. $EUR and $AUD bounce. $CAD stuck with crosses weighing.
Summary
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RBA keeps rates on hold at 1.50% with a dovish statement (as expected). AUDUSD probes below the 78 handle for a third time in as many days, but has since recovered in London trading. There’s talk of a $400mln option expiry at 0.7850 for today. Citibank was out yesterday with a note that was bearish AUD.
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EURUSD makes a new low overnight below 1.17 but is now bouncing hard into $4bln of option expiries for 10amET today (1.1750-1.1800). GBPUSD still struggling to find support with upside demand in EURGBP option strikes noted. USDJPY rallies back above 113 as Abe competitor Koike says she will not run for office (1mth call vols ease). USDCAD tests resistance in the 1.2520s overnight but has since backed off as cross sales from EURCAD and GBPCAD weigh.
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Hearing talk overnight that a large macro fund bought USD across the board.
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Nothing notable on the calendar today. BOC’s Leduc and FOMC’s Powell speaking at 12:30.
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CME open interest changes 10/2: AUD +961, GBP -3598, CAD -539, EUR +647, JPY +3693
Currency Calendar
| Date | Releases / Holiday | Entity |
|---|---|---|
| October 3, 2017 | RBA Rate Statement | AUD |
| October 3, 2017 | RBA Interest Rate Decision | AUD |
Bank holidays and impactful report releases for select countries.
By The Numbers: Daily FX Snapshot
USD/CAD - Canadian Dollar
Expect another range bound session ahead with the daily uptrend still intact but the USD turning lower elsewhere (ie. AUD and EUR), and nothing on the data docket. Light support 1.2450-80. Resistance at 1.2538, the London high. EURCAD struggling with the 1.47 handle not helping right now, nor is GBPCAD which looks set to attack the lower 1.65s.
EUR/USD - European Central Bank Euro
A strong bounce for the Euro overnight has done much to repair the daily candlestick for EURUSD. Market has to deal with expiries again up until 10amET. Support now 1.1720s, then the overnight low just below 1.17. Resistance 1.1760-70s. Both EURGBP and EURJPY lending support as the former now sets its sights the 89 handle and the latter bounces off the key support level we mentioned yesterday (132.30s). A narrowing of the US/German 10yr yield spread is also helping EUR this morning.
AUD/USD - Australian Dollar
The Aussie continues to hold on to the 78 handle as the RBA has come and gone with no surprises. Perhaps a little bit of sell the news, buy the fact today? NZDUSD tested lower earlier and reversed higher too. Today’s option expiries could maintain the bid going into 10amET. Market looks better technically above 0.7840-50.
Market Analysis Charts
USD/CAD Chart
EUR/USD Chart
AUD/USD Chart
Charts: TWS Workstation
About the Author
Erik Bregar - Trader
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