German industrial production increased in November monthly at a better-than-expected rate. German exports posted a bigger contraction than anticipated, confirming the global economy was weaker than priced in at the end of 2019. Imports also contracted. The EURJPY moved to the lower band of its horizontal support area. Will bears pressure for a breakdown, or can bulls attempt a reversal? Subscribe to the PaxForex Daily Fundamental Analysis and grow your balance trade-by-trade.
The Australian trade surplus surprised to the upside as exports as well as imports contracted more than economists predicted. Forex traders are also wrestling with the potential of an RBA interest rate cut, which has loomed over the Australian Dollar for several weeks. How will price action react as the trading sessions unfolds? Today’s fundamental analysis will take a look at the upside potential as well as the downside risk in this currency pair.
Here are the key factors to keep in mind today for Euro trades:
- German Industrial Production: German Industrial Production for November increased by 1.1% monthly and decreased by 3.2% annualized. Economists predicted an increase of 0.8% monthly and a decrease of 3.6% annualized. Forex traders can compare this to German Industrial Production for October, which decreased by 1.7% monthly and by 5.3% annualized.
- German Trade Balance & German Current Account Balance: The German Trade Balance for November was reported at €18.3B. Economists predicted a figure of €21.0B. Forex traders can compare this to German Trade Balance for October, which was reported at €21.5B. Exports for November decreased by 2.3% monthly, and Imports decreased by 0.5% monthly. Economists predicted a decrease of 0.9% monthly and an increase of 0.2% monthly. Forex traders can compare this to Exports for October, which increased by 1.2% monthly, and to Imports, which were reported flat at 0.0% monthly. The German Current Account Balance for November was reported at a €24.9B. Economists predicted a figure of €23.8B. Forex traders can compare this to the German Current Account Balance for October, which was reported at €22.7B.
- Italian Unemployment Rate: The Italian Unemployment Rate for November is predicted at 9.8%. Forex traders can compare this to the Italian Unemployment Rate for October, which was reported at 9.7%.
- Eurozone Unemployment Rate: The Eurozone Unemployment Rate for November is predicted at 7.5%. Forex traders can compare this to the Eurozone Unemployment Rate for October, which was reported at 7.5%.
Here are the key factors to keep in mind today for Australian Dollar trades:
- Australian Trade Balance: The Australian Trade Balance for November was reported at A$5,800M. Economists predicted a figure of A$4,100M. Forex traders can compare this to the Australian Trade Balance for October, which was reported at A$4,502M.
- Chinese PPI and Chinese CPI: The Chinese PPI for December decreased by 0.5% annualized, and the Chinese CPI increased by 4.5% annualized. Economists predicted a decrease of 0.4% and an increase of 4.7%. Forex traders can compare this to the Chinese PPI for November, which decreased by 1.4% annualized and to the Chinese CPI, which increased by 4.5% annualized.
Should price action for the EURAUD remain inside the or breakdown below the 1.6145 to 1.6210 zone the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 1.6165
- Take Profit Zone: 1.5800 – 1.5900
- Stop Loss Level: 1.6235
Should price action for the EURAUD breakout above 1.6210 the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 1.6235
- Take Profit Zone: 1.6430 – 1.6500
- Stop Loss Level: 1.6210
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