AUD/USD – Aussie Flat In Holiday Trade

The Australian dollar is steady on Thursday, as AUD/USD trades at 0.7270 in the North American session. In economic news, the Australian CB Leading Index posted a second straight decline of 0.1%. Australian markets are closed on Thursday. In the US, Unemployment Claims dipped to 267 thousand, beating expectations.

There were a host of US releases on Wednesday, with mixed results. Durable Goods reports were unimpressive, underscoring weakness in the US manufacturing sector. Core Durable Goods slipped by 0.1%, short of the forecast of a 0.1% gain. Durable Goods came in at 0.0%, but this beat the estimate of -0.6%. Housing numbers also disappointed, as New Home Sales dipped to 490 thousand, well off the estimate of 507 thousand. This reading comes on the heels of Existing Home Sales, which posted a weak reading of 4.76 million, its worst performance since April 2014. There was some good news from consumer indicators, as the UoM Consumer Sentiment improved to 92.6 points, above the forecast of 92.1 points and marking a 4-month high.

In one of the most important economic events in 2015, the US Federal Reserve raised interest rates by 0.25 percent, the first rate hike since June 2006. The Fed got the rate ball rolling back in October, when it surprised the markets when it released a statement that it was seriously considering raising rates. Predictably, this caused a buzz in the markets about the Fed’s plans, as speculation earlier in the year about a rate hike failed to materialize. To the credit of Fed chief Janet Yellen and her colleagues, the Fed put into place a carefully-crafted strategy, sending a steady of stream of signals that it was intending to tighten monetary policy, if economic conditions remained positive. This gave the markets ample time to price in a rate hike, and currency market volatility was not excessive after the US rate hike, the first in almost 10 years. Although a hike of 0.25 percent is expected to have limited economic impact, the Fed move has given the US economy a critical vote of confidence, and this will be duly noted by the global markets. As well, this move is expected to be the first in a series of incremental rate hikes over the course of 2016, and higher interest rates means that the US dollar will become even more attractive to investors, which could spell even more trouble for commodities such as gold.

AUD/USD Fundamentals

Thursday (Dec. 24)

• 13:30 US Unemployment Claims. Estimate 270K. Actual 267K
• 15:30 US Natural Gas Storage. Estimate -26B. Actual -32B

*Key releases are highlighted in bold

*All release times are GMT

AUD/USD for Thursday, December 24, 2015

AUD/USD December 24 at 16:40 GMT

AUD/USD 0.7267 H: 07280 L: 0.7231

AUD/USD Technical

• AUD/USD posted slight gains in the Asian session. The pair has leveled in the European and North American sessions.
• 0.7213 remains a weak support level
• 0.7349 is an immediate resistance line
• Current range: 0.7213 to 0.7349

Further levels in both directions:

• Below: 0.7213, 0.7100, 0.7063 and 0.6931
• Above: 0.7349, 0.7440 and 0.7526

OANDA’s Open Positions Ratio

AUD/USD ratio is unchanged, reflective of the lack of movement from the pair. The pair is evenly split between long and short positions, indicative of a lack of trader bias as to which direction the pair will head next.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.