AUD/USD: can't sustain a bid through the 0.72 handle
|- AUD/USD has been unable to maintain the bid through the 0.72 handle and is meeting supply in the 0.7220s and currently heading lower for a test of 0.72 the figure again.
- AUD/USD had been anchored by a big 0.7200 option expiry for today's NY cut, but still, bulls can't find mention post the cut.
- AUD/USD is weighed by performances on Wall Street (benchmarks turning south), once again on the backfoot with eyes below the 21-hr SMA.
AUD/USD has been helped along by the buoyant SSEC and Chinese authorities proposing the various supportive policy measures which has also forced a decline in USD/CNH's value, (falling from 6.97 to a recent low 6.9440. However, domestically, the Aussie economy is not giving the currency much to go on in the way of positives that is conducive to a sustained rally vs the greenback, where the US economy maintains the edge within the global arena. However, the main global risks stem from US-China trade tensions or a regional setback and eyes are on the lookout for a sharper-than-expected easing in the housing market.
All eyes still on China
Saying that, the latest communication from the Reserve Bank of Australia (RBA) was more upbeat whereby GDP forecasts were revised higher by 0.25pp to an above-consensus 3.50% in 2019 and 2020 while the unemployment rate was lowered 0.25pp to 4.75% in 2020 and inflation in 2020 is now seen as a “a bit higher” than its 2.25% forecast for 2019. Still, we are a long way off from prospects of an RBA rate hike and the divergence between the FOMC and RBA keeps a lid on rallies - Again, China is a threat to any prospects of an RBA hike.
AUD/USD levels
Analysts at Commerzbank noted that AUD/USD retested the 55 day moving average at 0.7167 before recovering. "Below it lies the mid-October high at 0.7160. Provided that the latter level holds, the September and current November highs at 0.7302/14 are expected to be revisited. If this resistance zone were to be better, the 200 day moving average at 0.7459 and the July 9 high at 0.7484 would be in focus."
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.