November 16, 2021

Daily Asia-London Sessions Watchlist: GBP/AUD

 GBP/AUD bears are back in control but with RBA minutes and U.K. employment data ahead, can they this hold this recent trip to the downside?

Before moving on, ICYMI, today’s Daily U.S. Session Watchlist looked at USD/JPY as it nears short-term resistance, so be sure to check that out to see if there is still a potential play!

Intermarket Update:

Equity Markets Bond Yields Commodities & Crypto

DAX: 16,148.64 +0.34%

FTSE: 7,351.86 +0.05%

S&P 500: 4,682.81 -0.00%

NASDAQ: 15,853.85 -0.04% US 10-YR: 1.623% +0.039

Bund 10-YR: -0.225% +0.02

UK 10-YR: 0.964% +0.001

JPN 10-YR: 0.078% +0.006 Oil: 80.95 +0.20%

Gold: 1,865.60 -0.16%

Bitcoin: $63,807.75 -0.69%

Ether: $4,572.00 +0.41%

Solana: $236.83 +0.00%

Fresh Market Headlines and Economic Data:

NY Empire State Manufacturing survey: 30.9 in Nov. vs. 19.8 in Oct.

Fed’s Kashkari expects higher inflation continuing over next few months

Biden to sign $1T bipartisan infrastructure bill into law, unlocking funds for utilities, broadband, and transportation

Bank of England Governor Bailey uncertain on inflation outlook; furloughed workers situation prompted surprise rate hold at last meeting

Bank of England Haskel says too early to declare success on employment situation; Brexit uncertainty also a contributor to postponing rate hike

Euro area international trade in goods surplus €7.3B; €0.5B surplus for EU

ECB‘s Lagarde sees inflation below 2% target in medium term; a rate hike in 2022 is “very unlikely”

Bitcoin upgrades to Taproot, boosting privacy, security, and transaction speed, as well as allowing for “smart contracts”

Upcoming Potential Catalysts on the Economic Calendar

RBA Meeting Minutes at 12:30 am GMT (Nov. 16)

RBA Governor Lowe speaks at 2:30 am GMT (Nov. 16)

Japan Tertiary Industry Index at 4:30 am GMT (Nov. 16)

U.K. Claimant Count Change, Unemployment Rate at 7:00 am GMT (Nov. 16)

France Inflation Rate at 7:45 am GMT (Nov. 16)

Italy Inflation Rate at 9:00 am GMT (Nov. 16)

Euro area Employment Change, GDP at 10:00 am GMT (Nov. 16)

If you’re not familiar with the forex market’s main trading sessions, check out our Forex Market Hours tool.

What to Watch: GBP/AUD

On the one hour chart above of GBP/AUD, we can see that the bears have been slowly taking ground from the bulls after topping the market out around the 1.8400 handle. After a steady grind lower over the past two sessions, the market is now retesting a minor support, between 1.8200 – 1.8300, with the bulls already rejecting on attempt to take the market lower.

This current bounce may draw in more sellers, especially now that it’s hitting a previous area of interest, around 1.8280, that was both short-term support and resistance in the month of November. This area is also the Fibonacci retracement area of the most recent swing move lower, so there are plenty of price action arguments that could draw in technical traders into the recent downtrend lower.

We do have potential catalysts coming soon from both Australia and the U.K., with the most notable being the minutes from the latest Reserve Bank of Australia meeting. These aren’t likely to give us anything new in terms of when the RBA may hike interest rates, but if it does surprise the markets, it should spark short-term moves in the Aussie.

We’ve also got the latest U.K. employment data in the upcoming London trading session to keep an eye on. This is also not likely to spark a big move, but if the surprise in average earnings or jobless claims is big enough, that could shift traders’ outlook on when the Bank of England may adjust interest rates.

For now, we’ll be keeping an eye on the 1.8300 area for bearish reversal patterns to play the short-term trend IF we get a mix of both weak U.K. employment data and hints of an earlier-than-expected rate hike from the RBA.