Australia – New Motor Vehicle Sales
Tomorrow, at GMT 1:30 a.m., the Australian Bureau of Statistics will release the new motor vehicle sales figure, which measures the changes in the number of cars that are sold in the local market over the past month.
Since people tend to make car purchases when they feel confident about their financial conditions, binary options traders consider the new motor vehicle sales figure is be a leading indicator of the consumer confidence in Australia.
In August, the new motor vehicle sales (m/m) figure declined by1.3% after growing at 3.8% in July. However, since May, it has been declining and indicating that the consumer confidence in Australia is gradually going down.
Eurozone – German ZEW Economic Sentiment
Later in the morning, at GMT 9:00 a.m., the Zentrum fur Europaische Wirtschaftsforschung (ZEW) will release its German economic sentiment index, which measures the level of a diffusion index based on surveying 275 German institutional investors and market analysts.
Since the professional investment community, investors and analysts have the latest data; their reflection about the economy tends to be the most accurate. Therefore, binary options investors consider the ZEW’s German economic sentiment index to be a leading indicator of the entire Eurozone economy. This is because the German economy is one the most important driving forces behind the Euro currency.
Last month, the ZEW German economic sentiment came out at 25.0, and this month the forecast is set at a very pessimistic level, at 18.3.
Trade Recommendation for the EUR/AUD
The EUR/AUD has been trending upwards for the last several months, but since the start of September, the EUR/AUD price has remained within a tight range between 1.5775 and 1.6150.
As the German economic sentiment is expected to go down significantly the fundamental outlook for the Euro would be bearish. Although the Australian motor vehicle sales is also decreasing, the ZEW economic sentiment is more important and would likely to have a higher impact on the EUR/AUD price. Hence, the overall outlook for the EUR/AUD would be bearish this week.
Under the circumstances, it is recommended that traders consider placing a PUT order for the EUR/AUD with their binary options brokers, once the price penetrates and closes below the support level around 1.5775.
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