AUD/USD – Slight Gains on Strong Aussie Data

The Australian dollar has posted modest gains on Thursday, as AUD/USD is trading in the high-0.87 range. In today’s releases, Australian Building Approvals posted a gain of 3.0% and the trade deficit dropped to 0.79 billion A$. In the US, Unemployment Claims looked solid, dropping to 287 thousand, down from 293 thousand a month earlier. The news was not all good, as Factory Orders plunged by 10.1%.

Australian Building Approvals looked sharp last month, with a gain of 3.0%. This easily beat the estimate of 1.1%. The trade deficit fell sharply to 0.79 billion A$, compared to a deficit of 1.36 billion a month earlier. The strong numbers gave a boost to AUD/USD, but gains were limited thanks to a solid US Unemployment Claims release.

In the US, employment numbers are showing improvement. US Unemployment Claims dropped to 287 thousand, beating the estimate of 299 thousand. ADP Nonfarm Payrolls surprised with a strong gain, climbing to 213 thousand, compared to 204 thousand in the previous release. This beat the estimate of 207 thousand. The ADP release precedes the official NFP release, which will be published on Friday. The markets are anticipating a sharp gain, with an estimate of 216 thousand. If the indicator does follow suit with a solid reading, the US dollar could post further gains against its major rivals.

On the manufacturing and housing fronts, this week’s US numbers were disappointing. ISM Manufacturing PMI fell to 56.6 points, down from 59.0 points a month earlier. US Pending Home Sales posted a decline of 1.0%, compared to last month’s gain of 3.3%. On Friday, we’ll get a look at ISM Non-Manufacturing PMI, with the markets braced for a softer reading for September.

AUD/USD for Thursday, October 2, 2014

AUD/USD October 2 at 14:25 GMT

AUD/USD 0.8776 H: 0.8816 L: 0.8740

AUD/USD Technical

• AUD/USD posted strong gains in the Asian session, coming close to resistance at 0.8820. The pair then retracted. AUD/USD has been choppy in the European and North American sessions.
• 0.8763 has switched to a support role as the Aussie trades at higher levels. This is a weak line and could see further action during the day. 0.8820 is stronger.
• 0.8820 is an immediate resistance line.
• Current range: 0.8763 to 0.8820

Further levels in both directions:

• Below: 0.8763, 0.8668, 0.8550, 0.8456 and 0.8315
• Above: 0.8820, 0.8953, 0.9020 and 0.9119

OANDA’s Open Positions Ratio

AUD/USD ratio is pointing to gains in long positions on Thursday, reversing the direction seen a day earlier. This is consistent with the pair’s movement, as the Aussie has posted gains. The ratio has a majority of long positions, indicative of trader bias towards AUD/USD continuing to move to higher ground.

AUD/USD Fundamentals

• 1:30 Australian Building Approvals. Estimate 1.1%. Actual 3.0%.
• 1:30 Australian Trade Balance. Estimate -0.75B. Actual -0.79B.
• 5:15 RBA Annual Report.
• 12:30 US Unemployment Claims. Estimate 299K. Actual 287K.
• 14:00 US Factory Orders. Estimate -9.4%. -10.1%.
• 14:30 US Natural Gas Storage. Estimate 107B. Actual 112B.

* 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.