AUD/USD – Aussie Softens at Start of Week

AUD/USD has posted losses on Monday, as the pair trades in the mid-0.86 range. It’s a quiet day on the release front, with only one US event. The Flash Services PMI continues to lose ground, dipping to 56.3 points in November. This fell short of the estimate of 57.3 points, and marked the indicator’s lowest reading since May.

US consumer inflation remained weak but met expectations in the November releases. CPI posted a flat 0.0%, edging above the estimate of -0.1%. Core CPI posted a gain of 0.2%, matching the forecast. Unemployment Claims came in at 291 thousand higher than the estimate of 286 thousand. There was good news as well, as the Philly Fed Manufacturing Index soared to 40.8 points, its highest since March 2011. The estimate stood at 18.9 points. As well, Existing Home Sales improved to 5.26 million, a one year high. The markets had expected a reading of 5.16 million.

The Federal Reserve released its minutes last week, but there were no clues about the timing of a rate hike. The markets are expecting rates to rise in the second half of 2015, but this will of course depend on economic conditions. With inflation below the Federal Reserve target of 2%, there is less pressure on the Fed to raise rates. The minutes also noted that weak economic outlooks in Europe and Japan are unlikely to have a negative impact on the US economy.

AUD/USD for Monday, November 24, 2014

AUD/USD November 24 at 15:25 GMT

AUD/USD 0.8621 H: 0.8701 L: 0.8613

 

AUD/USD Technical

S3 S2 S1 R1 R2 R3
0.8315 0.8456 0.8550 0.8668 0.8763 0.8820

 

  • AUD/USD lost ground late in the Asian session and this movement continued in European trade. The pair is showing little movement in the North American session.
  • 0.8668 was tested earlier but remains an immediate resistance line. 0.8763 is stronger.
  • 0.8550 is providing strong support.
  • Current range: 0.8550 to 0.8668.

Further levels in both directions:

  • Below: 0.8550, 0.8456, 0.8315 and 0.8240
  • Above: 0.8668, 0.8763, 0.8820, 0.8953 and 0.9020

 

OANDA’s Open Positions Ratio

AUD/USD ratio has a majority of long positions, indicative of trader bias towards AUD/USD reversing its downward movement and gaining ground.

 

AUD/USD Fundamentals

  • 14:20 US Flash Services PMI. Estimate 57.3 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.