AUD/USD – Rangebound After Recent Gains

AUD/USD has settled down after its recent gains, as the pair trades just under the 0.93 line. The pair has gained about one cent so far this week. Australia released another strong confidence indicator, as Westpac Consumer Sentiment posted a strong gain. The US posted another weak employment release on Tuesday, as US JOLTS Jobs Openings fell short of the estimate. President Obama addressed the nation about the Syrian crisis, saying that the US was postponing military action while there was a possibility that a diplomatic solution could be reached.

Australian releases continue to look solid, as Westpac Consumer Sentiment produced an excellent gain of 4.7% in August, compared to 3.5% the previous month. The strong reading comes on the heels of NAB Business Confidence, which soared from -3 points to +6 points in August, hitting a two-year high. Increasing business and consumer confidence bodes well for the Australian economy and the Aussie could pick up more ground. The currency has been red-hot, picking up close to four cents in September.

The Syrian crisis has taken on a new twist, as the US and Russia are looking for a diplomatic solution to the crisis. Under the proposed plan, Syria would destroy its entire arsenal of chemical weapons. President Obama spoke on US television on Monday and said that he would delay any military action as long as a diplomatic solution was possible, but that a strike against Syria was still on the table. If the diplomatic efforts gain momentum and the crisis eases, we could see the safe-haven dollar lose ground.

QE tapering continues to be a hot topic, but recent weak US employment numbers may cause a delay. Tuesday’s JOLTS Job Openings looked weak, coming in at 3.69 million, way off the estimate of 3.96 million. Last week’s Non-Farm Payrolls came in at 169 thousand, missing the estimate of 178 thousand. The Unemployment Rate dropped from 7.4% to 7.3%, but this improvement is not all that significant, given the low participation rate in the labor force. There has been talk of the Fed reducing QE as early as September, but we’re unlikely to see any action if US employment numbers don’t improve. Chicago Fed President Charles Evans has hinted that we could see some action on this front from the Fed before the end of the year.

 

AUD/USD for Wednesday, September 11, 2013

Forex Rate Graph 21/1/13
 

AUD/USD September 11 at 13:00 GMT

AUD/USD 0.9289 H: 0.9318 L: 0.9279

 

AUD/USD Technical

S3 S2 S1 R1 R2 R3
0.9089 0.9135 0.9221 0.9328 0.9400 0.9508

 

  • AUD/USD has taken a break from its rally in Wednesday trading. The pair punched past the 0.93 in the Asian and European sessions, but was unable to consolidate these gains.
  • The pair continues to face resistance at 0.9328. This is followed by stronger resistance at the round number of 0.94. This line has remained in place since mid-June.
  • On the downside, the pair is receiving support at 0.9221. This is followed by support at 0.9135.
  • Current range: 0.9221 to 0.9328

 

Further levels in both directions:

  • Below: 0.9221, 0.9135, 0.9089, 0.9000, 0.8926 and 0.8848
  • Above: 0.9328, 0.9400, 0.9508 and 0.9613

 

OANDA’s Open Positions Ratio

AUD/USD ratio is unchanged in Wednesday trading. This is reflective of what we are currently seeing from the pair, which is rangebound. We have seen a significant shift in September in favor of short positions, due to the sharp rise of the Australian dollar.

The Australian dollar has had an excellent September, gaining close to four cents. With no major releases out of the US on Wednesday, the pair could continue to drift in the North American session.

 

AUD/USD Fundamentals

  • 00:30 Australian Westpac Consumer Sentiment. Actual 4.7%.
  • 14:00 US Wholesale Inventories. Estimate 0.3%.
  • 14:30 US Crude Oil Inventories. Estimate -2.2M.
  • 17:00 US 10-year Bond Auction.

 

*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

Market Analyst at OANDA
A highly experienced financial market analyst with a focus on fundamental analysis, Kenneth Fisher’s daily commentary covers a broad range of markets including forex, equities and commodities. His work has been published in several major online financial publications including Investing.com, Seeking Alpha and FXStreet. Based in Israel, Kenny has been a MarketPulse contributor since 2012.
Kenny Fisher

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