AUD/USD news - page 7

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AUD/USD Forecast Aug. 4-8

AUD/USD lost close to a cent last week, as the pair just above the 0.93 level. This week’s highlights are Retail Sales and Employment Change. Here is an outlook on the major market-movers and an updated technical analysis for AUD/USD.

Australian Building Approvals and PPI both posted declines in June, hurting the Australian dollar. In the US, consumer confidence and manufacturing data was strong, but Nonfarm Payrolls took a tumble in June and was well off expectations.

Updates:

  1. Chinese Non-Manufacturing PMI: Sunday, 00:59. The PMI dipped to 53.4 points last month, but the index remains well above the 50-point line, which marks expansion. The Australian dollar is sensitive to key Chinese data, as China is Australia’s number one trading partner.
  2. MI Inflation Gauge: Monday, 00:30. Inflation Gauge, which is released monthly, helps analysts track CPI, which is released each quarter. The indicator has been on a downward trend, and posted a flat 0.0% reading last month, its worst showing in almost a year.
  3. Retail Sales: Monday, 1:30. This is the first key events of the week. The indicator surprised with a 0.5% decline last month, its first drop since April 2013. The markets are expecting a turnaround in the July release, with the estimate standing at 0.3%.
  4. ANZ Job Advertisements: Monday, 1:30. Job Advertisements is an important gauge of activity on the employment front. The indicator bounce back last month with a strong gain of 4.3%. The markets will be hoping for another solid outing in the upcoming release.
  5. AIG Services Index: Monday, 23:30. The index has been mired below the 50-point level since February, indicative of ongoing contraction in the services sector. No significant change is expected in the July release.
  6. Trade Balance: Tuesday, 1:30. Trade Balance is closely linked to currency demand, as foreigners must purchase Australian dollars in order to purchase Australian exports. Australia has posted two consecutive declines and the markets are expecting another drop in the July release, with an estimate of -$2.00 billion.

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Aussie Halts Two-Day Gain as China Services Stagnate;

Australia’s dollar snapped a two-day gain as an industry gauge of Chinese services showed activity stagnated for the first time on record.

The Aussie weakened versus all except one of its 16 major counterparts as the Reserve Bank of Australia left its benchmark interest rate on hold at a meeting today. The euro was 0.4 percent from the lowest since November versus the dollar before the European Central Bank decides on policy in two days. South Korea’s won strengthened for a second day as the country’s foreign-exchange reserves rose to a record.

“The Chinese PMI figures came in a bit below expectations, showing a stalling of the recent upturn in the Chinese data, so that’s putting some downward pressure on commodity currencies like the Aussie,” said Desmond Chua, a strategist at CMC Markets in Singapore, referring to the purchasing managers index released today.

The Australian dollar weakened 0.1 percent to 93.27 U.S. cents at 1:34 p.m. in Tokyo after appreciating 0.4 percent during the previous two days. The currency has rallied 4.6 percent this year.

The U.S. dollar was little changed at $1.3419 per euro after advancing to $1.3367 on July 30, the strongest level since Nov. 12. The greenback was unchanged at 102.57 yen. The yen traded at 137.64 per euro versus 137.66 yesterday.

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Trading the Australian Employment Change

Australian Employment Change, which is released monthly, provides a snapshot of the health of the Australian employment market. A reading which is higher than the market forecast is bullish for the Australian dollar.

Here are the details and 5 possible outcomes for AUD/USD.

Published on Thursday at 1:30 GMT.

Indicator Background

Job creation is one of the most important leading indicators of overall economic activity. Thus, the release of Employment Change can have a major impact on the movement of AUD/USD.

Employment Change bounced back last month with a strong gain of 15.9 thousand, well above the estimate of 12.3 thousand. Another strong gain is expected, with the estimate standing at 12.3 thousand. Will the indicator repeat and beat the forecast?

Sentiment and Levels

The Australian dollar had enjoyed an uneventful summer, but was swept lower last week by the broadly-stronger US dollar. The Australian economy remains fragile, with the export-driven economy struggling with the ongoing global slowdown. So, we could see the greenback’s rally continue this week. Thus, the overall sentiment remains bearish on AUD/USD towards this release.

Technical levels from top to bottom: 0.97, 0.9526, 0.9441, 0.9369, 0.9279 and 0.9175.

5 Scenarios

  1. Within expectations: 10.0K to 14.0K: In this scenario, AUD/USD could show some slight fluctuation, but it is likely to remain within range, without breaking any levels.
  2. Above expectations: 14.1K to 17.0K: A strong reading could push the pair above one resistance level.
  3. Well above expectations: Above 17.0K: A sharp rise in employment numbers could propel AUD/USD upwards, and a second resistance line could be broken.
  4. Below expectations: 7.0K to 9.9K: A lower than expected reading could pull the pair downwards, with one support level at risk.
  5. Well below expectations: Below 7.0K: A very poor reading could result in AUD/USD breaking below a second support level.

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AUD/USD almost unchanged, global concerns ease

The Australian dollar was almost unchanged against its U.S. counterpart on Monday, as concerns over geopolitical tensions around the globe began to subside, easing demand for the safe-haven greenback.

AUD/USD hit 0.9274 during late Asian trade, the session low; the pair subsequently consolidated at 0.9274, dipping 0.03%.

The pair was likely to find support at 0.9239, Friday's low and resistance at 0.9330, the high of July 31.

The greenback lost some ground after the U.S. launched airstrikes in Iraq on Friday, in a bid to halt the advance of extremists in the country’s north.

Also in the Middle-East, Israel and the Palestinians agreed on Sunday to an Egyptian proposal for a new 72-hour ceasefire in Gaza.

Meanwhile, fears over hostilities between Russia and Ukraine eased after Russia’s defense ministry on Friday said it had concluded military exercises it was holding close to the border with Ukraine.

The Aussie had dropped to two-month lows against the greenback on Friday after the Reserve Bank of Australia cut growth and inflation forecasts and reiterated that interest rates will remain on hold.

The Australian dollar was higher against the euro, with EUR/AUD slipping 0.10% to 1.4444.

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The Aussie rises on strong domestic data

We’ve seen some creeping dollar strength overnight, the main exception being the Aussie which has held above the 0.9250 level for the most part, aided by stronger domestic data showing better than expected business confidence and also house price increases in the second quarter. Whilst we have seen some correction in equities more recently, the dollar has been less inclined to give up some of the recent gains. The dollar index itself has risen in only 4 of the past 20 sessions, Sterling especially looks stretched vs. the dollar, daily RSI indicators at levels that were last seen on a more sustained basis in the early part of 2013. For sterling at least, there may be a partial resolution with the release of the Bank of England Inflation Report tomorrow. Over the past two years, the daily cable range on Inflation Report days has been nearly twice the normal daily average and with the market clearly short sterling, the risk is skewed towards short-covering on anything other than a decidedly dovish outcome.

The other stand-out from overnight activity has been the kiwi, which has weakened towards the 0.8400 level with housing data falling to the soft side and further cementing the view that the RBNZ will be on hold for the remainder of the year after the recent tightening cycle. Looking at the data calendar, there is nothing that is going to shift sentiment dramatically today. The German ZEW reading will be of passing interest at 10:00 GMT. Otherwise, there are no key US releases until retail sales data tomorrow.

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AUD/USD holds steady, eyes on U.S. jobless claims

The Australian dollar was steady against its U.S. counterpart on Thursday, after a report showed that inflation expectations in Australia ticked lower last month and as investors eyed the release of U.S. jobless claims data later in the day.

AUD/USD hit 0.9288 during late Asian trade, the session low; the pair subsequently consolidated at 0.9230, inching down 0.04%.

The pair was likely to find support at 0.9265, Wednesday's low and resistance at 0.9320, Wednesday's high.

In a report, the Melbourne Institute said that inflation expectations for the next year in Australia slipped to 3.1% in July, from 3.8% in June.

Meanwhile, sentiment on the greenback remained vulnerable after the Commerce Department reported on Wednesday that U.S. retail sales were flat last month, disappointing expectations for a 0.2% increase.

Core retail sales, which exclude auto sales, rose just 0.1% in July, compared to expectations for a 0.4% gain.

The Aussie was lower against the New Zealand dollar, with AUD/NZD shedding 0.24% to 1.0974.

Also Thursday, official data showed that retail sales in New Zealand rose 1.2% in the last quarter, beating expectations for an increase of 1.0%. Retail sales for the first quarter were revised to a 0.8% gain from a previously estimated 0.7% rise.

Core retail sales, which exclude automobiles and gas stations, advanced 1.2% in the second quarter, compared to expectations for a 1.1% rise. In the three months to April, core retail sales increased 1.0%, up from a previously estimated 0.8% gain.

 

AUD/USD Forecast Aug. 18-22

For a second straight week, AUD/USD showed little movement, as the pair closed at 0.9316. This week’s major event is the RBA Monetary Policy Meeting Minutes. Here is an outlook on the major market-movers and an updated technical analysis for AUD/USD.

Australian data was solid last week, led by a strong jump in NAB Business Confidence. In the US, key consumer indicators disappointed, as retail sales and consume sentiment numbers softened in July.

  1. New Motor Vehicles Sales: Monday, 1:30. This indicator is an important gauge of consumer spending, as increased demand for big-ticket items such as cars and trucks points to stronger consumer confidence and spending. The indicator jumped 1.7% in June, its strongest gain this year. Will the indicator post another sharp gain in July?
  2. RBA Monetary Policy Meeting Minutes: Tuesday, 1:30. This is the key release of the week. The minutes provide a detailed record of the RBA’s most recent policy meeting. The value of the Australian dollar is often discussed at the meetings, so the minutes could have an effect on the direction of AUD/USD.
  3. RBA Governor Glenn Stevens Speaks: Tuesday, 23:30. Stevens is scheduled to testify before the House of Representatives Standing Committee on Economics in Brisbane. The markets will be listening closely, looking for clues regarding the RBA’s future monetary policy.
  4. MI Leading Index: Wednesday, 00:30. This index is based on 9 economic indicators, but is considered a minor event since most of the data has already been released. The indicator has been steady, posting gains of 0.1% in the past two readings.
  5. CB Leading Index: Thursday, 00:00. This index is based on 7 economic indicators, and can affect the movement of AUD/USD. The index has not shown strong gains in 2014, and posted a 0.2% gain in June.

* All times are GMT.

 

AUD/USD forecast for the week of August 25, 2014

The AUD/USD pair fell during most of the week, but found enough of a bounce just above the 0.92 level to form a nice-looking hammer. Because of this, we believe that the market probably going to bouncer here, but ultimately we also believe that it will stay within the consolidation area, meaning that it will not get above the 0.95 level, and probably stop at the 0.9450 region. With that, we do not see a long-term set up at this point in time, and therefore are avoiding long-term trades.

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AUD/USD Forecast Aug. 25-29

AUD/USD showed some downward movement, but ended the week unchanged, as the pair closed at 0.9315. This week’s major event is Private Capital Expenditure. Here is an outlook on the major market-movers and an updated technical analysis for AUD/USD.

The Aussie dipped after RBA Governor Glenn Stevens sounded somewhat downbeat, as he stated that in the present economic environment, the economy needed an injection of confidence rather than lower interest rates. Stevens also warned that the risk of the Australian dollar dropping to lower levels was “underestimated”. In the US, there was good news on the employment, manufacturing and housing fronts last week, pointing to balanced growth in the economy. There was a lot of hype leading up to Janet Yellen’s speech at Jackson Hole on Friday, but the Fed chair focused on the US employment picture and didn’t provide any clues about the timing of an interest rate.

  1. Construction Work Done: Monday, 1:30. This indicator, released each quarter, is an important gauge of the strength of the construction industry. The indicator posted a gain of 0.3% in Q1, well above the estimate of -0.3%. The markets are bracing for a downturn in the Q2 release, with the estimate standing at -0.4%.
  2. HIA New Home Sales: Thursday, Tentative. This is a minor event which is unlikely to have much effect on the movement of AUD/USD. The indicator has posted gains throughout 2014, with one exception. In June, the indicator posted a solid gain of 1.2%.
  3. Private Capital Expenditure: Thursday, 1:30. Private Capital Expenditure, released each quarter, is the key event of the week. Increased capital spending is an important component of economic growth and is carefully monitored by analysts. The indicator is coming off two sharp declines, and another drop is expected in Q2, with an estimate of -0.8%.
  4. Private Sector Credit: Friday, 1:30. This event gauges the amount of borrowing in the private sector, and is of interest since there is a strong correlation between borrowing and spending. The indicator has matched or beaten the estimate in recent readings, and posted a strong gain of 0.7% last month. The forecast for the July reading stands at 0.5%.

* All times are GMT.

 

AUD/USD forecast for the week of September 1, 2014

The AUD/USD pair had a slightly positive week, but as you can see stays within the range that we have been in for some time. We broke the top of the hammer from the previous week, so it makes sense that the market when a little bit positive, but at the end of the day we think that there is almost no way that the Australian dollar can get above the 0.95 level anytime soon, so therefore we are simply looking at this is a short-term market at the moment.

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