By FXEmpire.com
Introduction: The Australian dollar still isn’t in its good old days, but the performance is definitely improving. Resistance lines tend to work in a smoother manner than support lines, but they also work well. The pair move well together, not much volatility, but easy to chart and easy to trade with low risk factors.
Weekly Analysis and Recommendation:
The AUD/USD closed a rocky week at 0.9768 which saw it continue to tumble. Unfortunately the strength of the USD as markets remained in risk aversion mode and negative eco data from Australia, the Aussie had very little chance to gather any strength. The Aussie is still recovering from the RBA rate reduction and growth reductions.
This week’s prices are shown below:
Commodity currencies this week were stuck between the USD and the JPY as investors ran for cover over concerns with Greece’s possible exit from the euro and the growing problems with Spanish banks. The markets were also upset by statements from the IMF, the OECD, the World Bank and the IIF, all trying to push the EU into some plan of action. After the much expected EU mini summit with the disappointing conclusion, investors shied away from everything associated with the EU as the euro plummeted to record lows.
All the pacific nations and commodity currencies suffered.
Asian markets will have little capacity to influence the global tone with the possible exception of China’s state version of the purchasing managers’ index that is due out on Thursday night. Consensus is expecting a modest drop to a still expansionary reading that lies at odds with the private sector PMI which remains in contraction, and with hard data on industrial production that has slowed markedly into the New Year. Indian Q1 GDP is expected to come in at 6% y/y which would remain among the weakest growth rates of the past decade. Japanese household spending, retail trade, industrial production and housing starts are also on next week’s schedule. RBA Governor Glenn Stevens’ delivers a speech into the Monday market open ahead of the June 5th RBA rate decision that consensus expects will yield no change in the cash target rate of 3.75%. The RBA has cut by 100bps since October in two moves.
Major Economic Events for the week of May 21-25 actual v. forecast for Yen, the Aussie and the Kiwi
|
Currency |
Actual |
Forecast |
Previous |
|
|
NZD |
Inflation Expectations q/q |
2.4% |
2.5% |
|
|
JPY |
Trade Balance |
-0.48T |
-0.60T |
-0.62T |
|
AUD |
CB Leading Index m/m |
0.2% |
0.0% |
|
|
AUD |
MI Leading Index m/m |
0.4% |
0.0% |
|
|
JPY |
Overnight Call Rate |
|
|
|
|
NZD |
Trade Balance |
355M |
445M |
186M |
|
JPY |
Tokyo Core CPI |
-0.8% |
-0.6% |
-0.5% |
Economic Highlights of the coming week that affect the AUD, JPY, NZD and USD
|
Date |
Currency |
Previous |
||
|
May 28 |
23:30 |
JPY |
3.4% |
|
|
23:50 |
JPY |
10.3% |
||
|
May 29 |
TBD |
AUD |
-9.4% |
|
|
13:00 |
USD |
-3.5% |
||
|
14:00 |
USD |
69.2 |
||
|
22:45 |
NZD |
19.8% |
||
|
May 30 |
1:30 |
AUD |
0.9% |
|
|
1:30 |
AUD |
-4.6% |
||
|
14:00 |
USD |
4.1% |
||
|
23:50 |
JPY |
1.3% |
||
|
May 31 |
1:00 |
NZD |
35.8 |
|
|
1:30 |
AUD |
7.4% |
||
|
1:30 |
AUD |
-0.3% |
||
|
1:30 |
AUD |
0.4% |
||
|
1:30 |
JPY |
1.3% |
||
|
12:15 |
USD |
119K |
||
|
12:30 |
USD |
2.2% |
||
|
12:30 |
USD |
370K |
||
|
13:45 |
USD |
56.2 |
||
|
15:00 |
USD |
0.9M |
||
|
23:50 |
JPY |
7.6% |
||
|
Jun 1 |
12:30 |
USD |
115K |
|
|
12:30 |
USD |
8.1% |
||
|
12:30 |
USD |
0.2% |
||
|
12:30 |
USD |
0.3% |
||
|
14:00 |
USD |
54.8 |
Upcoming Government Bond Auctions
Date Time Country
May 28- n/a UK
May 28 09:10 Italy
May 29 00:30 Japan
May 29 09:10 Italy
May 29 09:10 Norway
May 30 09:10 Italy
May 30 09:10 Sweden
Click here for further AUD/USD Forecast.
Originally posted here
