AUD/USD – Lower as Australian Construction Slips

AUD/USD has posted losses on Wednesday, continuing the trend which started the week. The struggling Aussie has lost about 160 points since the start of the week. Early in the North American session, the pair is trading just above the 0.85 line. On the release front, Australian Construction Work Done disappointed with a decline of 2.2%. In the US, it was a hectic day ahead of the Thanksgiving holiday on Thursday. The news was dismal, as Unemployment Claims, Core Durable Goods Orders and New Home Sales all missed their estimates.

Australian construction data looked awful, as Construction Work Done slipped 2.2% in Q3, worse than the estimate of -1.7%. The weak reading could provide some insight as to what we can expect from Australian GDP next week, as the stagnating construction sector could weigh on economic activity. Early on Thursday, we’ll get a look at Private Capital Expenditure, the key Australian event of the week.

The US released a host of key data on Wednesday, but the numbers were weak across-the-board. Unemployment Claims jumped to 313 thousand, its highest level since mid-September. Core Durable Goods Orders declined 0.9%, its third decline in four readings. The estimate stood at 0.5%. New Home Sales fell to a 3-month low, dropping to 458 thousand. This was short of the estimate of 471 thousand. Pending Home Sales was no better, declining by 1.1%, well off the estimate of 0.9%. There was better news from UoM Consumer Sentiment, which posted a fourth straight gain, rising to 88.8 points. However, this was short of the estimate of 90.2 points. Despite all the gloomy numbers, the US dollar managed to post gains against the Aussie, thanks to weak Australian construction data.

AUD/USD for Wednesday, November 26, 2014

AUD/USD November 26 at 15:00 GMT

AUD/USD 0.8519 H: 0.8565 L: 0.8480

 

AUD/USD Technical

S3 S2 S1 R1 R2 R3
0.8240 0.8315 0.8456 0.8550 0.8668 0.8763

 

  • AUD/USD was uneventful in the Asian session. In European trade, the pair lost ground, for the second straight day. The pair is unchanged in the North American session.
  • 0.8456 is an immediate support level.
  • 0.8550 is a weak resistance line. 0.8668 is stronger.
  • Current range: 0.8456 to 0.8550.

Further levels in both directions:

  • Below: 0.8456, 0.8315, 0.8240 and 0.8150
  • Above: 0.8550, 0.8668, 0.8763, 0.8820 and 0.8953

 

OANDA’s Open Positions Ratio

AUD/USD ratio is pointing to gains in short positions on Wednesday, reversing the direction we saw a day earlier. This is consistent with the movement of the pair, as the Australian dollar continues to lose ground. The ratio has a majority of long positions, indicative of trader bias towards AUD/USD reversing its sharp slide and moving higher.

AUD/USD Fundamentals

  • 00:30 Australian Construction Work Done. Estimate -1.7%. Actual -2-2%.
  • 13:30 US Core Durable Goods Orders. Estimate +0.5%. Actual -0.9%
  • 13:30 US Unemployment Claims. Estimate 287K. Actual 313K.
  • 13:30 US Core PCE Price Index. Estimate 0.1%. Actual 0.2%.
  • 13:30 US Durable Goods Orders. Estimate -0.4%. Actual +0.4%.
  • 13:30 US Personal Spending. Estimate 0.4%. Actual 0.2%.
  • 13:30 US Personal Income. Estimate 0.4%. Actual 0.2%.
  • 14:45 US Chicago PMI. Estimate 63.1 points. Actual 60.8 points.
  • 14:55 US Revised UoM Consumer Sentiment. Estimate 90.2 points. Actual 88.8 points.
  • 14:55 US Revised UoM Inflation Expectations. Actual 2.8%.
  • 15:00 US New Home Sales. Estimate 471K. Actual 458K. 
  • 15:00 US New Pending Home Sales. Estimate 0.9%. Actual -1.1%.
  • 15:30 US Crude Oil Inventories. Estimate 0.4M. Actual 1.9M.
  • 15:00 US Natural Gas Storage. Estimate -145B.

*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.