There are a couple of key expiry levels to take note of on the day, as highlighted in bold below.
The first is for EUR/USD at the 1.1175 level, with the strike holding roughly within 10 pips of the spot price. That could help keep price action more contained around current levels, particularly with markets awaiting major central bank decisions later this week. Having said that, the technical downside momentum looks to be taking over again for EUR/USD and that could open up a push towards testing the month’s lows around 1.1111 in the bigger picture.
Then, there is a sizable cluster of expiries for USD/JPY layered between 157.75 to 158.00. All three are sitting just above the current spot price, so they could exert some magnetic pull on price action and potentially keep the pair more anchored around the region ahead of the cut later. However, just be wary that any fresh intervention warnings from Japanese officials could easily override that influence.
And lastly, there is one for AUD/USD at the 0.7030 level – just a little over 10 pips away from the spot price. That could also act as a potential magnet for price action, with the expiry level tying closely with the 100-day moving average at 0.7031 currently. Put together, that could act as a bit of a resistance point for AUD/USD in the session ahead should trading conditions remain relatively subdued.
In the bigger picture, the pair will still be largely influenced by broader risk sentiment and dollar flows before we get to the key central bank decisions and big tech earnings later this week. Besides that, the Australia CPI data tomorrow will also be one to note for the aussie as that could have the potential to induce more volatility to the pair.
But for now though, it’s all a waiting game as traders will likely be content to stick with a more patient and cautious tone before we get into the bigger events on the week.
For more information on how to use this data, you may refer to this post here and/or refer to the Q&A below.
