AUD/USD – Steady Despite Weak Building Appovals

The Australian dollar is steady as we start the new trading week. AUD/USD is trading in the low-0.91 level in Monday’s European session. In economic news, Australian Building Approvals, dropped sharply but managed to beat the estimate. Company Operating Profits looked sharp, hitting an eight-month gain. Over in the US,  today’s key event is the ISM Manufacturing PMI. As well, Federal Reserve Chairman will deliver remarks in Washington, as the markets look for clues with regard to QE tapering.

It was a busy start to the week for Australian releases. Building Approvals, a key event, is known for its sharp fluctuations. After a huge gain of 14.4% in October, the indicator tumbled, posting a decline of 1.8% in November. However, the markets were braced for a much sharper decline, with the estimate standing at -4.3%. Meanwhile, Company Operating Profits jumped 3.9% in Q3, its best result since 2011. The reading easily beat the estimate of 1.1%. On Tuesday, the RBA will announce its new interest rate. The markets are expecting the rate to remain at 2.50%, but the Bank has surprised the markets in the past and a rate reduction of 0.25% remains a slight possibility.

Over in the US, the markets will be keeping close tabs on this week’s US employment releases, as the Fed is likely to step in and taper QE if employment numbers continue to improve. Unemployment Claims have looked sharp for the past two releases, and if the Non-Farm Payrolls and Unemployment Rate look solid, this week, the US dollar could gain ground.

AUD/USD for Monday, December 2, 2013

AUD/USD December 2 at 14:00 GMT

AUD/USD 0.9125 H: 0.9168 L: 0.9116

AUD/USD Technical

• AUD/USD has not been able to sustain any momentum in Monday trading. The pair touched a high of 0.9168 in the European session but has retracted.
• The pair is testing support at 0.9119. This is followed by support at the key 0.90 level.
• AUD/USD continues to face resistance at 0.9229. This is followed by a resistance line at 0.9305.
• Current range: 0.9119 to 0.9229

Further levels in both directions:

• Below: 0.9119, 0.9000, 0.8893, 0.8735 and 0.8658
• Above: 0.9200, 0.9305, 0.9400 and 0.9508

OANDA’s Open Positions Ratio

AUD/USD ratio is unchanged in Monday trading. This is reflected in the current movement of the pair, which is showing little change. The ratio is made up of a substantial majority of long positions, reflecting a trader bias towards the Australian dollar moving to higher ground.

The pair is trading very quietly as we begin the week. With the US releasing a key PMI later in the day, we could see some movement from AUD/USD during the North American session.

AUD/USD Fundamentals

• 00:30 Australian Building Approvals. Estimate -4.3%. Actual -1.8%.
• 00:30 Australian Company Operating Profits. Estimate 1.1%. Actual 3.9%.
• 5:30 Australian Commodity Prices. Actual -1.9%.
• 13:30 Fed Chairman Bernard Bernanke Speaks.
• 14:00 US Final Manufacturing PMI. Estimate 54.3 points. Actual 54.7 points.
• Sep. Data – US Construction Spending. Estimate 0.5%.
• 15:00 US ISM Manufacturing PMI. Estimate 55.2 points.
• 15:00 US Construction Spending. Estimate 0.4%.
• 15:00 US ISM Manufacturing Prices. Estimate  55 points.

*Key releases are highlighted in bold

*All release times are GMT

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