AUD/USD threatening the 20-hour SMA to the downside
|- AUD/USD about to break lower?
- AUD/USD has plenty of data today.
AUD/USD is testing the 200-hr SMA on the downside after the first piece of data for the day, albeit without a move as traders sit tight ahead of Q4 wage price data. (Australia - Westpac Leading Index for January: -0.24% m/m (prior +0.27%)). Currently, AUD/USD is trading at 0.7916, up 0.08% on the day, having posted a daily high at 0.7922 and low at 0.7905.
Overnight, gold and metals were lower on a strong greenback with US yields dominating the markets yet again. The commodity-linked Aussie was changing hands in a chop, sliding on a strong greenback to 0.7885 from 0.7908 highs.
Next hour is critical
The next hour or so should be critical for the bulls defending key support and analysts at Westpac offered a preview of the data that will be eyed closely by the RBA:
"This week’s data highlight for Australia is the Q4 wage price index at 11:30amSyd/Mel. RBA governor Lowe said last week that wages growth probably needs to pick up to about 3.5%yr in order for the RBA to hit its 2.5% average inflation target. Instead, the survey has been bumping around 1.9-2.0% since Q3 2016 and consensus for Q4 2017 is 0.5%qtr, 2.0%yr.
Released at the same time is Australia Q4 construction data, an input to the GDP report due 7 March. The headline reading is currently being distorted by imported liquefied natural gas processing platforms (Q3 +15.7%, Q4 expected to unwind much of this) but the details provide some interest in various sectors of construction."
AUD/USD levels
Ona break to the downside, the bullish channel will be at risk of a break down that was formed from the 200-D SMA down at 0.7769. Valeria Bednarik, chief analyst at FXStreet explained that in the 4 hours chart, the price is unable to recover above a flat 20 SMA, currently around 0.7920, but struggling around a horizontal 200 EMA and the mentioned Fibonacci level. "Indicators hold below their mid-lines with different directional strength, anyway leaning the scale toward the downside," Valeria added.
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.