AUD/USD – Aussie Rise Continues As Retail Sales Jump

AUD/USD continues to post gains early in the new trading week. The pair is trading slightly above the 0.95 line in Monday's European session. The Australian dollar received a boost from Retail Sales, which hit a seven-month high. As well, Chinese Non-Manufacturing PMI continued its upward trend. It's a quiet day in the US, with Factory Orders for August and September the only economic releases on the schedule.

Australian key releases continue to show improvement. Retail Sales, the most important consumer spending indicator, jumped 0.8% in October, its best showing since March. The estimate stood at 0.5%. This follows Friday's PPI release, which gained 1.3%. This easily beat the estimate of 0.4%. However, ANZ Job Advertisements posted another decline and HPI missed the estimate. Positive Chinese data also helped the Aussie, as the Non-Manufacturing PMI posted its best reading in over a year.

The Federal Reserve met for a policy meeting last week, the first since Congress reached an agreement on the debt ceiling and the shutdown. As expected, the Fed said that it would maintain QE at current levels of $85 billion each month. However, the Fed's policy statement was less dovish than expected, as the Fed noted that the economy was expanding "at a moderate pace" and left the door open for QE tapering in December. However, the prevailing view in the markets is that short of a sharp turnaround in US numbers, QE tapering will be on hold until early 2014.

After a host of weak numbers early in the week, US numbers showed some improvement. Unemployment Claims practically matched the forecast, and ISM Manufacturing PMI beat the estimate. With the Fed unlikely to taper QE before 2014, the QE uncertainty which was has been weighing on the dollar has eased, which could bolster the US dollar.

 

AUD/USD for Monday, November 4, 2013

Forex Rate Graph 21/1/13

AUD/USD November 4 at 12:30 GMT

AUD/USD 0.9504 H: 0.9510 L: 0.9462

 

AUD/USD Technical

S3 S2 S1 R1 R2 R3
0.9229 0.9305 0.9400 0.9508 0.9613 0.9700

 

  • AUD/USD continues to post gains in Monday trading. The pair crossed above the 0.95 line earlier in the European session.
  • The pair is testing resistance at 0.9508. This is a weak line which could fall in the North American session. This is followed by a strong resistance line at 0.9613.
  • On the downside, the pair is receiving support at the round number of 0.9400. This is followed by support at 0.9305, which has remained in place since early October.
  • Current range: 0.9400 to 0.9508

 

Further levels in both directions:

  • Below: 0.9400, 0.9305, 0.9229 and 0.9119
  • Above: 0.9508, 0.9613, 0.9700, 0.9821 and 0.9900

 

OANDA's Open Positions Ratio

AUD/USD ratio continues to be made up of  a majority of open long positions, reflecting a trader bias towards the Aussie continuing to move higher.

After a dismal performance last week, the Australian dollar has rebounded and has posted gains against the US dollar. There are no major releases out of the US on Monday, so it could be a quiet day for AUD/USD.

 

AUD/USD Fundamentals

  • 00:30 Australian Retail Sales. Estimate. 0.5%. Actual 0.8%.
  • 00:30 Australian ANZ Job Advertisements. Estimate -0.1%.
  • 00:30 Australian HPI. Estimate 2.3%. Actual 1.9%.
  • 22:30 Australian AIG Services Index.
  • 15:00 US Factory Orders. Estimate 1.9%.
  • 15:00 US Factory Orders (Aug. Data). Estimate 0.2%.
  • 16:40 US FOMC Member Jerome Powell Speaks.
  • 21:00 US FOMC Member Eric Rosengren Speaks.

 

 

*Key releases are highlighted in bold

*All release times are GMT

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

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Kenny Fisher

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.