AUD/USD – Aussie Tests 90 Line as US Data Sparkles

The Australian dollar continues to lose ground against the US currency in Thursday trading. AUD/USD is struggling to stay above the key 0.90 level early in North American trading. In economic news, US numbers looked sharp, as Unemployment Claims and GDP posted strong readings. The Aussie didn’t get any help from Australian Trade Balance, which posted a larger deficit and missed the estimate. Australian AIG Construction Index will be released later on Thursday.

US data looked very sharp on Thursday. Unemployment Claims posted its lowest number in two months, dropping to 298 thousand. This easily beat the estimate of 328 thousand. Meanwhile, GDP, released each quarter, shot up to 3.6% in Q3, its sharpest gain in close to four years. The estimate stood at 3.0%. The excellent releases are likely to fuel speculation about when the Fed might step in with QE tapering.

Australian key releases continue to disappoint. The trade deficit widened to -0.53 billion dollars, up from -0.28 billion a month earlier. This figure fell short of the estimate of -0.38 billion. Earlier this week, GDP also missed expectations. The indicator edged lower in November, posting a gain of 0.6%, compared to 0.7% a month previously. The estimate stood at 0.8%.

As expected, the RBA did not reduce interest rates on Tuesday. The benchmark rate has remained pegged at 2.50% since August. Although the Bank has not shied away from saying that the Aussie is overvalued and is impeding economic growth, it has been hesitant to reduce rates, and this was apparent once again on Tuesday. In other news, Retail Sales dropped to 0.5% in October, down from 0.8% the month before, but edged above the estimate of 0.4%. The current account deficit widened to -12.7 billion dollars, well above the estimate of -11.1 billion.

 

AUD/USD for Thursday, December 5, 2013

Forex Rate Graph 21/1/13

AUD/USD December 5 at 14:25 GMT

AUD/USD 0.9018 H: 0.9058 L: 0.9004

 

AUD/USD Technical

S3 S2 S1 R1 R2 R3
0.8735 0.8893 0.9000 0.9119 0.9229 0.9305

 

  • AUD/USD continues to point south in Thursday trading. The pair has dropped to a low of 0.9004 as the Aussie is under strong pressure.
  • The pair is testing support t at the key level of 0.9000. Will this line fall during the day? This is followed by support at 0.8893.
  • On the upside, 0.9119 is providing resistance. This line has some breathing room as the pair trades at lower levels. This is followed by a resistance line at 0.9229.
  • Current range: 0.9000 to 0.9119

 

Further levels in both directions:

  • Below: 0.9000, 0.8893, 0.8735 and 0.8658
  • Above: 0.9119, 0.9200, 0.9305, 0.9400 and 0.9508

 

OANDA’s Open Positions Ratio

AUD/USD ratio is pointing to gains in short positions on Thursday, continuing the trend we saw in Wednesday trading. This is reflected in the current movement of the pair, as the Aussie has posted losses against the US dollar. The ratio is made up of a substantial majority of long positions, reflecting a trader bias towards the Australian dollar reversing directions and moving to higher ground.

The Australian dollar continues to struggle, and we could see AUD/USD dip below the 0.90 level during the North American session.

 

AUD/USD Fundamentals

  • 00:30 Australian Trade Balance. Estimate 0.38B Actual -0.53B.
  • 13:30 US Preliminary GDP. Estimate 3.0%. Actual 3.6%.
  • 13:30 US Unemployment Claims. Estimate 328K. Actual 298K.
  • 13:30 US Treasury Secretary Jack Lew Speaks.
  • 13:30 US Preliminary GDP Price Index. Estimate 1.9%. Actual 2.0%.
  • 15:00 US Factory Orders. Estimate -0.9%.
  • 15:30 US Natural Gas Storage. Estimate -141B.
  • 22:30 Australian AIG Construction Index.

 

*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.

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.