AUD/USD – Small Gains as Australian Building Approvals Shines

AUD/USD has posted small gains on Thursday, as the pair trades  slightly above the 0.81 line. On the release front, Australian Building Approvals posted an  excellent gain of 7.5%. In the US, Unemployment Claims dropped to 294 thousand, slightly above the estimate.  This figure was within expectations, as the estimate stood at 291 thousand. On Friday, we’ll get a look at the all-important Nonfarm Payrolls as well as the unemployment rate.

There was good news out of Australia, as Building Approvals posted a strong gain of 7.5% in November. This crushed the estimate of -2.7%. This key indicator tends to show strong fluctuations, but has now posted strong gains for two consecutive months. Earlier in the week, Australian Trade Balance was stronger than expected, as the trade deficit narrowed in November to AUD -$0.93 billion, marking a 3-month low. This was well below the forecast of AUD -$1.59 billion.

The Federal Reserve released the minutes of its previous meeting on Wednesday, with no surprises to shake up the markets. There had been a lot of speculation that the insertion of the word “patience” in the December policy statement signaled a more aggressive monetary stance on the part of the Fed. However, the minutes stated that Fed members remained of the view that monetary policy had not changed, and that a rate hike would not occur before April. The markets are expecting a rate hike sometimes in 2015, but it’s hard to be any more precise. Although economic growth continues to improve, inflation remains at very low levels, which means that the economy is in no danger of overheating, so there is no immediate need for a rate increase.

AUD/USD for Thursday, January 8, 2015

AUD/USD January 8 at 15:15 GMT

AUD/USD 0.8118 H: 0.8125 L: 0.8075

 

AUD/USD Technical

S3 S2 S1 R1 R2 R3
0.7799 0.7904 0.8081 0.8150 0.8214 0.8315

 

  • AUD/USD has posted slight gains in the Asian session, breaking above resistance at 0.8081. The pair has been steady in the European and North American sessions.
  • 0.8081 has reverted to a support line as the pair has moved slightly higher. 0.7904 is a stronger line.
  • 0.8150 is an immediate resistance line.
  • Current range: 0.8081 to 0.8150.

Further levels in both directions:

  • Below: 0.8081, 0.7904, 0.7799, 0.7701 and 0.7549
  • Above: 0.8150, 0.8214, 0.8315 and 0.8456

 

OANDA’s Open Positions Ratio

AUD/USD ratio is pointing to gains in short positions on Thursday, reversing the direction seen a day earlier. This is not consistent with the movement of the pair, as the Australian dollar has posted small gains. The ratio has a majority of long positions, indicative of trader bias towards AUD/USD moving higher.

AUD/USD Fundamentals

  • 12:30 US Challenger Job Cuts. Actual 6.6%.
  • 13:30 US Unemployment Claims. Estimate 291K. Actual 294K.
  • 15:30 US Natural Gas Storage. Estimate -120B. Actual -131B.
  • 20:00 US Consumer Credit. Estimate 15.1B.

*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.