Jul
29
2010

 

AUD/USD Back at .90

The Aussie’s highly psychological .90 level is proving to be a tough adversary to overcome for the bulls, particularly after Wednesday’s CPI reading came in lower than anticipated.  Australia’s consumer prices only rose by 0.6% and investors were expecting 1%.  The weak CPI reading compliments Monday’s disappointing PPI figure and it is likely the present slack in prices will lead the RBA to keep its benchmark rate unchanged.  In its last meeting minutes, the RBA stated that prices and EU stress test results would be the two factors determining whether the central bank hikes rates by another 25bp.  Even though the risk trade has reacted positive to last Friday’s stress test results, the disappointing pricing data should keep the RBA in check.  As a result, the Aussie’s rally has hit a roadblock and the currency pair is no longer outperforming.  That being said, it will be interesting to see whether intraday highs represent a double-top or if the Aussie will continue its resurgence beyond .90.  Tomorrow could prove to be a good test for the Aussie with a hefty U.S. data set on the way.  The U.S. will highlight Friday’s trading session by releasing prelim GDP and investors are expecting growth to cool a bit from last quarter to 2.5%.     
 
Technically speaking, the Aussie faces technical barriers in the form of intraday and 7/27 highs.    As for the downside, the Aussie has multiple near-term uptrend lines working in its favor along with intraday lows.  Additionally, the psychological .90 level may now serve as a psychological cushion.  
Price: .9001
Resistances:  .9025, .9044, .9073, .9097, .9121, .9137
Supports:  .8999, .8975, .8940, .8919, .8893, .8867, .8850
Psychological:  .90, July highs and lows
 
 
 

 
Posted by: Matthew Myers

 

Disclaimer: FastBrokers' market commentary is provided for information purposes only and under no circumstances should be regarded neither as investment advice nor as a solicitation or an offer to sell/buy any financial product. FastBrokers assumes no responsibility or liability from gains or losses incurred by the information herein contained. All materials are property of Fast Trading services, LLC and unless otherwise indicated, any unauthorized reproduction is prohibited.

 

 
support