Since Q1 of 2017, the Euro has surged against the Aussie. Many analysts and institutional investors attribute this recent surge to general USD weakness. When taken practically and logically, this has been the case and despite yesterday’s DPKK threat, it looked like investors still prefer commodity currencies like the Aussie and the Kiwi. Actually, that is what happened yesterday, the Yen attracted investors while the USD was briefly dumped before rebounding latter in the European and NY session. There were limited losses for commodity currencies as they remained steady despite them being off from their highs. I will expect Euro to continue with its rally against most major currencies and that is why, aside from the localized effect of Hurricane Harvey, I’m net long the Euro and that begins with dumping the Aussie ahead of Australia’s Private Expenditure which is released quarterly. The general consensus is private expenditure will decline to 0.2% which is lower than Q2 0.3% expansion.
With this, I will look at the charts. As we can see, bullish momentum continues in the monthly chart. There is also a buy signal printed in the 4HR chart. I will trade as follows:
Stop Loss: 1. 5000
Take profit: 1.5300
Have a good trading day.