AUD/USD – Aussie Makes Modest Gains on Weak US Durables

AUD/USD has posted modest gains on Tuesday, after a slow start to the week. Early in the North American session, the pair is trading in the mid-88 range. The Australian dollar took advantage as US Core Durable Goods Orders posted a decline of 0.2%. Later in the day, the US releases CB Consumer Confidence. The markets are expecting a strong reading, so we could see the US dollar recover some of today’s earlier losses. There are no Australian releases on Tuesday.

In the US, durable goods looked dismal. Core Durable Goods Orders dropped 0.2%, its second decline in three months. This was well short of the estimate of 0.5%. Durable Goods Orders followed suit with a decline of -1.3%. This was a second straight decline, and missed the estimate of 0.4%. Later in the day, the US releases CB Consumer Confidence, with the markets anticipating a strong September reading.

The Federal Reserve will be at center stage on Wednesday, as a two-day meeting wraps up with the release of a policy statement. The Fed is expected to wind up QE, and if policymakers delay this move, the dollar will likely take a hit against its major rivals. The markets will also be looking for hints regarding the timing of a rate hike, which is expected sometime in 2015. Traders should treat this release as a market-mover which could have a significant impact on the currency markets.

AUD/USD for Tuesday, October 28, 2014

AUD/USD October 28 at 14:10 GMT

AUD/USD 0.8849 H: 0.8882 L: 0.8789

 

AUD/USD Technical

S3 S2 S1 R1 R2 R3
0.8668 0.8763 0.8820 0.8953 0.9020 0.9119

 

  • AUD/USD has been climbing slowly throughout the day. The pair broke past resistance at 0.8820 late in the Asian session and continued to gain ground in European trade. AUD/USD is stable early in the North American session.
  • On the upside, 0.8820 is under strong pressure. 0.8953 is stronger.
  • 0.8820 was breached and has reverted to a support role. It is a weak line and could see further action during the day. 0.8668 is stronger.
  • Current range: 0.8820 to 0.8953.

Further levels in both directions:

  • Below:0.8220,  0.8763, 0.8668, 0.8550 and 0.8456
  • Above: 0.8953, 0.9020, 0.9119 and 0.9217

 

OANDA’s Open Positions Ratio

AUD/USD ratio is pointing to gains in short positions on Tuesday, continuing the trend seen a day earlier. This is not consistent with what we’re seeing from the pair, as the Australian dollar has posted gains. The ratio has a majority of long positions, indicative of trader bias towards AUD/USD continuing  to move to higher ground.

 

AUD/USD Fundamentals

  • 12:30 US Core Durable Goods Orders. Estimate +0.5%. Actual -0.2%.
  • 12:30 US Durable Goods Orders. Estimate +0.4%. Actual -1.3%.
  • 13:00 S&P/CS Composite-20 HPI. Estimate 5.7%. Actual 5.6%.
  • 14:00 US Richmond Manufacturing Index. Estimate 11 points.
  • 14:00 US CB Consumer Confidence. Estimate 87.4 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.