APAC Currency Corner

Price action leaves traders in no man’s land. Moreover,  outside of some OIL price influenced movements on the Commodity Bloc , “FX Land”  has been restrained

Despite the stellar Westpac Consumer Confidence number yesterday , the Aussie  then came under pressure testing .7350 levels after Moody’s investor services said that Australia’s four major banks face moderate weakening in asset quality and slowdown in earning

Overnight The Aussie bounced off yesterday’s APAC lows testing the .74 handle on the back of surging oil prices but has since come under renewed pressure as traders continue to sell the Aussie on Commodity Price inspired rallies. The surge in oil prices came after the Department of Energy inventories showed a large draw of 3.41 million barrels which was in acute contrast to Tuesday API survey and left traders completely wrong-footed on sentiment.

Adding to the AUDUSD  downward momentum , consumer inflation  expectations  came in lower printing 3.2% versus 3.6 % prior

Short-term FX noise aside, the Aussie is in consolidation mode after finding a solid wall of resistance at .7300 level with trader’s very comfortable keeping positions light and powder dry ahead of Friday’s US Retail sales. Investors are expecting 0.8% on the headline

Overnight risk sentiment was still leaning negative as US equity markets sold off aggressively in the final hour of New York trade.   However, traders will be eyeing regional bourses  today and  given the technical  juncture we are at on the G3 currencies; Global equity markets need to be watched  the remainder of the week given the current risk environments  high correlation with the Aussie dollar.

Stephen Innes

Stephen Innes

Senior Currency Trader and Analyst at OANDA
Stephen has over 25 years of experience in the financial markets and specializes in Asian currencies at OANDA. After having started his trading career with NatWest Bank, he is currently based in Singapore as a Senior Currency Trader and Analyst with OANDA, focusing on the movement of the Aussie Dollar and ASEAN Currencies. Stephen has an extensive trading experience in Interest Rate Futures, Money Markets and Precious Metals. Prior to joining OANDA, he worked with organizations like Cambridge Mercantile, Nat West, Garvin Guy Butler, Sumitomo Mitsui Banking Corporation. Stephen was born in Glasgow, Scotland, and holds a Degree in Economics from the University of Western Ontario.
Stephen Innes
Stephen Innes

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