European Open: RBA hint at a pause, EUR/GBP continues higher

Close-up of market chart
Matt Simpson financial analyst
By :  ,  Market Analyst

Asian Indices:

  • Australia's ASX 200 index fell by -36.7 points (-0.52%) and currently trades at 6,962.60
  • Japan's Nikkei 225 index has fallen by -280.04 points (-1.02%) and currently trades at 27,433.77
  • Hong Kong's Hang Seng index has fallen by -304.81 points (-1.86%) and currently trades at 16,053.71
  • China's A50 Index has fallen by -108.48 points (-0.91%) and currently trades at 11,804.37

 

UK and Europe:

  • UK's FTSE 100 futures are currently down -27.5 points (-0.38%), the cash market is currently estimated to open at 7,268.75
  • Euro STOXX 50 futures are currently down -27 points (-0.72%), the cash market is currently estimated to open at 3,701.03
  • Germany's DAX futures are currently down -88 points (-0.64%), the cash market is currently estimated to open at 13,578.32

 

US Futures:

  • DJI futures are currently up 54 points (0.17%)
  • S&P 500 futures are currently up 42.25 points (0.39%)
  • Nasdaq 100 futures are currently up 7.75 points (0.21%)

 

20221110futuresFX

 

RBA hint at a pause

Answering questions to parliament, RBA’s Deputy Governor Michelle Bullock gave a strong hint that the central bank is approaching pause in regards to their tightening cycle. Noting that rates have already been raised “substantially”, she said that they could be nearing a level where there “might be an opportunity to sit and wait”. Rates are currently at 2.85% after seven consecutive hikes, and we’re now left wondering if the RBA will deliver a Christmas present to the people by not hiking interest rates until February.

 

EUR/GBP hits a 4-week high

20221110eurgbpFX

We noted EUR/GBP’s breakout last week and, after pulling back to the monthly pivot, has turned higher once more. A bullish wedge is in play which projects a target near the patterns base around 0.9060. For today, we’d like to see prices hold above 0.8780 high and break back above the monthly R2- but if we see a low volatility pullback beneath this level then we’d still consider bullish setups on lower timeframes for a potential bullish swing trade. The 0.8866 high is now likely in focus for bulls.

The EUR/AUD analysis from Monday is playing out nicely, with the daily chart making a clear breakout to confirm the bullish channel and now within 1-2 day’s ATR away from the 1.5706 high. The daily chart may not offer the adequate reward to risk ratio around current levels, but if it can pullback then perhaps it could become of interest for bullish intraday traders.

 

 

FTSE 350 – Market Internals:

20221110moversFTSEfx

FTSE 350: 4033.95 (0.66%) 09 November 2022

  • 229 (65.43%) stocks advanced and 112 (32.00%) declined
  • 3 stocks rose to a new 52-week high, 1 fell to new lows
  • 12.57% of stocks closed above their 200-day average
  • 50.57% of stocks closed above their 50-day average
  • 5.43% of stocks closed above their 20-day average

 

Outperformers:

  • + 4.35% - Ferrexpo PLC (FXPO.L)
  • + 4.10% - BBGI Global Infrastructure SA (BBGIB.L)
  • + 3.55% - Smiths Group PLC (SMIN.L)

 

Underperformers:

  • -9.92% - FirstGroup PLC (FGP.L)
  • -6.31% - J D Wetherspoon PLC (JDW.L)
  • -5.76% - Petrofac Ltd (PFC.L)

 

 

Economic events up next (Times in GMT)

20221110calendarGMT

 

 

 

How to trade with FOREX.com

Follow these easy steps to start trading with FOREX.com today:

  1. Open a Forex.com account, or log in if you’re already a customer.
  2. Search for the pair you want to trade in our award-winning platform.
  3. Choose your position and size, and your stop and limit levels.
  4. Place the trade.

  

Related tags: Trade Ideas EUR GBP Forex RBA

Open an account in minutes

Experience award-winning platforms with fast and secure execution.

Web Trader platform

Our sophisticated web-based platform is packed with features.

Economic Calendar