Aussie plummets and Euro climbs on US Tillerson’s ousting.
China data to influence AUD bids at 02:00 GMT.
The EUR/AUD pair climbed in Tuesday’s New York market on political turmoil from the White House, and the pair is trading near 1.5770 in the overnight session.
Donald Trump spooked markets when he suddenly fired his Secretary of State, presumably after too many disagreements regarding foreign policy with North Korea, Iran, and China. Along with Gary Cohn’s recent resignation as Trump’s top economic advisor, Tillerson’s firing is shaking market confidence in the White House.
Wednesday will bring German CPI at 07:00 GMT and the headline year-on-year numbers for February are expected to come in at the previous reading of 1.2%. After that will see a speech from the European Central Bank’s President, Mario Draghi, at 08:00 GMT. Draghi is expected to touch on trade war fears, with recent trade tariffs from the US taking over headlines.
Before that will be Chinese Retail Sales, Industrial Production, and Foreign Direct Investment will be dropping at 02:00 GMT and a beat for figures could have a knock-on effect on the AUD.
The pair’s spike on Tuesday has drawn the pair away from the 34 EMA and back into bullish territory. The EUR/AUD is still off March’s high of 1.5978 but a floor could be priced in from here if Euro buyers maintain the pace of bidding. Support is coming from the 8-day EMA at 1.5760 and the 34-day EMA at 1.5675, while resistance sites at the top of February’s consolidation zone near 1.5815 and March’s high of 1.5978.
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