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Forex: AUD/USD trading in narrow range, CPI due out later in week

FXstreet.com (Barcelona) - The Aussie is trading in a narrow range during the current Asia session. A number of economic reports which may have influence on the pair will be released later this week including China PMI, Aussie CPI, and US GDP.

According to Gregory McKenna of Global FX, “As noted last week the Aussie was vulnerable given the heavy longs in the market while gold was falling. The fall in net big spec longs of 24k roughly helps explain why the Aussie was consistently unable to sustain any strength in the last week.” He went on to add “Aussie net longs are around about mid range for the past 6 months but a break of 1.0250 would certainly get some further liquidation happening and any move below 1.02 will likely bring in the sellers heavily. The Aussie is vulnerable based on positioning this week so watch the CPI.”

The FXStreet.com Trend Index remains in slightly bearish set up on the daily chart, while the OB/OS Index is Oversold. First resistance sits at 1.0305 (previous support, now resistance on daily chart), followed by 1.0356 (the 45 dma). Initial support sits at 1.0240, followed by 1.0140 (key support pivot on weekly chart). A move below 1.0140 would be a key break of the recent trading range and points to eventual targets as low as 0.9650.

Forex Flash: Gold drop expected to knock 3.5 cents off the AUD/USD - NAB

As NAB analyst note: “Since the beginning of April, gold has fallen almost $200 per ounce, at one point reaching a 2 year low of $1322, before recovering to $1410. The yellow metal is now down
15% year-to-date and 26% from its 2011 peak,” the bank says, while Gold trades last at $1408 in the spot market.
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Forex: GBP/USD holds above 1.5200 at fresh 2-week lows

Cable is last at 1.5217, off recent session and fresh 2-week lows at 1.5202, down -0.11% for the week so far, and -1% from Friday's highs. According to the FXstreet daily supply/demand report: “With the price now resting at 1.5225/1.5215 demand, area which had multiple hits - exchange rate enjoying no bounce at all - looks like downside pressure may intensify,” the analysts note.
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