AUD/USD – Quiet Start to Week After Mixed Releases

The Australian dollar is trading quietly as we begin a new trading week. In Monday’s European session, AUD/USD is trading slightly above the 0.92 line. Australians voted in a new government on Saturday, as Conservative Leader Tony Abbott won in convincing style. In economic news, ANZ Job Advertisements posted a sharp decline, but Home Loans beat the estimate. Chinese key releases were solid, as Trade Balance hit a seven-month high and CPI matched the forecast. In the US, there is just one minor release on Monday. On Friday, Non-Farm Payrolls was a major disappointment, missing the estimate.

Australians voted for a change at the helm in national elections on the weekend. After six years of the Labor party in office, the electorate wanted a change, and got it. Liberal leader Tony Abbott won a landslide victory, with the Liberal-National coalition garnering 88 of the 150 seats in Parliament. Abbott has promised to bring back budget surpluses and told cheering supporters that the country is “under new management and Australia is now open for business”. The Australian dollar has shown little reaction to the election, although the currency has spiked about three cents since the start of September.

Australian data started off the week in missed fashion. ANZ Job Advertisements continues to post declines, and dropped 2.0% in August. Home Loans dropped from 2.4% in July to 2.7% in August, but still beat the estimate of 2.2%. The Aussie is sensitive to key Chinese data, and the Asian giant started off the week on a positive note. Trade Balance jumped from 17.8 billion dollars in July to 28.5 billion in August, easily surpassing the estimate of 20.3 billion. Chinese CPI, one of the most important releases, came in at 2.6%, matching the forecast. This was a slight drop from the 2.7% release in July.

The US ended last week on a disappointing note, as the all-important Non-Farm Payrolls came in at 169 thousand, missing the estimate of 178 thousand. The Unemployment Rate dropped from 7.4% to 7.3%, but this improvement is not all that significant, given the low participation rate in the labor force. The Fed continues to keep its cards away from prying market eyes, but we’re unlikely to see QE tapering without stronger employment numbers. Chicago Fed President Charles Evans hinted that we could see some action on this front from the Fed before the end of the year.

AUD/USD for Monday, September 9, 2013

AUD/USD September 9 at 13:00 GMT

AUD/USD 0.9213 H: 0.9224 L: 0.9168

AUD/USD Technical

• AUD/USD is firm in Monday trading, as the pair trades above the 0.92 line. The pair touched a low of 0.9168 in the Asian session but has since recovered.
• The pair is testing resistance at 0.9221. This is followed by stronger resistance at 0.9328. This line has remained in place since late June.
• On the downside, the pair is receiving support at 0.9135. This is followed by support at 0.9089.
• Current range: 0.9135 to 0.9221

Further levels in both directions:

• Below: 0.9135, 0.9089, 0.9000, 0.8926, 0.8848 and 0.8747
• Above: 0.9221, 0.9328, 0.9400 and 0.9508

OANDA’s Open Positions Ratio

AUD/USD ratio points to a strong majority of long positions, indicating strong trader bias towards the Aussie continuing its rally and posting more gains against the US dollar.

The Australian dollar has had an excellent September, gaining three cents already. Will the upward trend continue? With no major US releases on Monday, we could see a quiet North American session for AUD/USD.

AUD/USD Fundamentals

• 1:30 Australian ANZ Job Advertisements. Actual -2.0%.
• 1:30 Australian Home Loans. Estimate 2.2%. Actual 2.4%.
• 19:00 US Consumer Credit. Estimate 12.7B.

*Key releases are highlighted in bold

*All release times are GMT

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.