AUD/USD – Aussie Stable at 81 on Mixed US Data

AUD/USD is showing little movement on Tuesday, as the pair is trading in the mid-0.81 range late in the European session. In the US, a very busy day on the release front has yielded mixed results. Final GDP soared in the third quarter, with a gain of 5.0%, but Core Durable Goods Orders dropped by 0.4%. New Home Sales disappointed, dropping sharply to 438 thousand. The only Australian release today is the CB Leading Index, a minor event.

US GDP was red-hot in Q3, jumping 5.0%, ahead of the estimate of 4.6%. This marked the indicator’s strongest gain since the third quarter of 2003. The US economy is expected to continue to surge in 2015, driven by increased consumer spending and confidence. The news was not as positive from Core Durable Goods Orders, which posted a decline of 0.4%, its fourth decline in five readings. The reading was well off the estimate of 1.1%. Durable Goods Orders looked even worse, with a reading of -0.7%. This surprised the markets which had anticipated a strong gain of 3.0%. Elsewhere, housing data continues to weaken as New Home Sales slipped to 438 thousand, its poorest showing since July. This was well short of the forecast of 461 thousand.

The Australian dollar recorded sharp losses after Wednesday’s Federal Reserve policy statement. Previous Fed policy statements have usually stated that the Fed would maintain low rates for a “considerable time”, but the December statement changed terminology, saying the Fed would be “patient” before raising rates. In a follow-press conference, Federal Reserve chair Janet Yellen was less ambiguous, saying that the Fed was unlikely to raise rates for the “next couple of meetings”. The markets took this to mean that a rate hike is in the works, but not before April. The Aussie took a hit after the news, losing about 100 points to the US dollar on Wednesday.

AUD/USD for Tuesday, December 23, 2014

AUD/USD December 23 at 15:30 GMT

AUD/USD 0.8110 H: 0.8144 L: 0.8089

AUD/USD Technical

• AUD/USD has been choppy during the day and remains range-bound. The pair touched a high of 0.8144 in the European session, putting strong pressure on resistance at 0.8150.
• 0.8150 is a weak resistance line which could break in the North American session. 0.8214 is stronger.
• On the downside, 0.8081 is under pressure. 0.7904 is next.
• Current range: 0.8081 to 0.8150.

Further levels in both directions:

• Below: 0.8081, 0.7904, 0.7799 and 0.7701
• Above: 0.8150, 0.8214, 0.8315, 0.8456 and 0.8550

OANDA’s Open Positions Ratio

AUD/USD ratio is almost unchanged on Tuesday. This is consistent with the pair, which has shown limited movement. The ratio has a majority of long positions, indicative of trader bias towards AUD/USD breaking out of range and moving higher.

AUD/USD Fundamentals

• 13:30 US Core Durable Goods Orders. Estimate 1.1%. Actual -0.4%.
• 13:30 US Final GDP. Estimate 4.3%. Actual 5.0%.
• 13:30 US Durable Goods Orders. Estimate 3.0%. Actual -0.7%.
• 13:30 US Final GDP Price Index. Estimate 1.4%. Actual 1.4%.
• 14:00 US HPI. Estimate 0.3%. Actual 0.6%.
• 14:55 US Revised UoM Consumer Sentiment. Estimate 93.5 points. Actual 93.6 points.
• 14:55 US Revised UoM Inflation Expectations. Actual 2.8%.
• 2:59 US Richmond Manufacturing Index. Estimate 8 points. Actual 7 points.
• 15:00 US New Home Sales. Estimate 461K. Actual 438K.
• 15:00 US Core PCE Price Index. Estimate 0.1%. Actual 0.0%.
• 15:00 US Personal Spending. Estimate 0.5%. Actual 0.6%.
• 15:00 US Personal Income. Estimate 0.6%. Actual 0.4%.

*Key releases are highlighted in bold

*All release times are GMT

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