AUD/USD – Aussie Shrugs Off Weak US Core Durable Goods

AUD/USD continues to show little movement so far this week, as the pair trades in the mid-0.92 range late in Tuesday’s European session. On the release front, US Core Durable Goods slipped to a four-month low. We’ll get a look at CB Consumer Confidence later in the day. The markets are expecting another strong reading in the April release. There are no Australian releases on Tuesday.

US Core Durable Goods Orders, the primary gauge of manufacturing activity, disappointed in April. The indicator slumped to just 0.1%, missing the estimate of 0.2%. This compared to a strong gain of 2.0% last month. Durable Goods Orders dropped to 0.8%, but did beat the estimate of -0.5%.

Australian consumers were in a sour mood in April, as Consumer Sentiment plunged 6.8%, its steepest decline since August 2011. Weaker consumer confidence usually translates into less consumer spending, a key engine of economic growth. With the recent Australian budget offering tax increases and spending cuts, the fragile Australian economy is expected to slow down, and this could hurt the Australian dollar. We’ll get a look at the highlight of the week, Private Capital Expenditure, early on Wednesday.

 

AUD/USD for Tuesday, May 27, 2014

Forex Rate Graph 21/1/13

AUD/USD May 27 at 12:45 GMT

AUD/USD 0.9254 H: 0.9274 L: 0.9248

 

AUD/USD Technical

S3 S2 S1 R1 R2 R3
0.9000 0.9119 0.9229 0.9361 0.9446 0.9617

 

  • 0.9229 is a weak support line. There is stronger support at 0.9119.
  • 0.9361 continues to provide strong resistance.

Further levels in both directions:

  • Below: 0.9229, 0.9119, 0.9000, 0.8893 and 0.8757
  • Above: 0.9361, 0.9446 and 0.9617 and 0.9757

 

OANDA’s Open Positions Ratio

AUD/USD ratio is pointing to gains in short positions in Tuesday trading. This is not consistent with the movement from the pair, which is not showing very little activity. The ratio has a strong majority of long positions, indicative of trader bias towards the Australian dollar breaking out of range trading and moving upwards.

AUD/USD continues to look listless on Tuesday. The pair is unchanged is steady in the European session.

 

AUD/USD Fundamentals

  • 12:30 US Core Durable Goods Orders. Estimate 0.2%. Actual 0.1%.
  • 12:30 US Durable Goods Orders. Estimate -0.5%. Actual 0.8%.
  • 13:00 US S&P/CS Composite-20 HPI. Estimate 11.9%.
  • 13:00 US HPI. Estimate 0.5%.
  • 13:45 US Flash Services PMI. Estimate 55.6 points.
  • 14:00 US CB Consumer Confidence. Estimate 83.2 points.
  • 14:00 US Richmond Manufacturing Index. Estimate 5 points.

*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.