AUD/USD for Thursday, March 26, 2015
The rollercoaster ride just rolls on for the Australian dollar as it has eased back to the key 0.7850 level after surging higher to a new four week around 0.79 a couple of days ago. Over the last week or so it has moved back and forth from below 0.76 and up to the key resistance level at 0.7850 and higher. A couple of weeks ago the Australian dollar made a statement and broke down strongly through the key 0.77 level which then provided significant resistance for the following few days. It was also able to enjoy some short term support around 0.7550 which propped it up and allowed it to rally strongly in the last week. Several weeks ago the Australian dollar made repeated attempts to move up strongly to the resistance level at 0.7850 however it was rejected every time and sent back easing lower, which is why this level remains significant presently. Just prior to that the Australian dollar moved through the resistance at 0.7850 to reach a new four week high around 0.7900.
In the second half of January, the Australian dollar fell very sharply and break lower from the trading range that had been established roughly between 0.8050 and 0.8200. Back in mid-January it made numerous attempts at the resistance level at 0.82 only to be sent back often before finally finishing that week moving through this key level. In doing so it was able to reach a one month high near 0.83 before being sold back down again towards 0.82 as the resistance and selling activity above this level kicked in. Over the Christmas / New Year period, the Australian dollar seemed to have been content with trading in a narrow range below the resistance at 0.82, which continues to remain a key level as it is presently provides resistance. The Australian dollar experienced a disappointing November and December moving from resistance around 0.88 down to the new lows recently. For a couple of months from September through to November, the Australian dollar did well to stop the bleeding and trade within a range between 0.8650 and 0.88 after experiencing a sharp decline throughout September which saw it move from close to 0.94 down to below 0.8650.
Back at the beginning of September the Australian dollar showed some positive signs as it surged higher again bouncing off support below 0.93 and reaching a new four week high around 0.94 however that all now seems a distant memory. It seems a long way away now but the Australian dollar reached a three week high just shy of 0.9480 at the end of July after it enjoyed a solid period which saw it surge higher through the resistance level at 0.9425 to the three week around 0.9480, before easing back towards that level. The Australian dollar enjoyed a solid surge higher reaching a new eight month high above 0.95 at the end of June, only to return most of its gains in very quick time to finish out that week. Since the middle of June the Australian dollar has made repeated attempts to break through the resistance level around 0.9425, however despite its best efforts it was rejected every time as the key level continued to stand tall, even though it has allowed the small excursion to above 0.95.
The financial stability of Australian businesses is on the improve as companies watch their spending and borrow less. Challenges remain however for businesses in the commercial housing and resources sector. The Reserve Bank’s latest Financial Stability Review reveals financial stress for Australian businesses is falling. Debt levels remain near historical lows, having fallen sharply after the financial crisis and remained in check since. This, combined with record low interest rates, has left businesses in a good financial position. “Business finances appear generally in good shape,” the RBA said. Recent surveys have shown business confidence in Australia is struggling, and businesses are being frugal with their money as a result. “Like households, businesses remain fairly cautious in their spending and borrowing decisions, despite the low interest rates,” the report said.
(Daily chart / 4 hourly chart below)
AUD/USD March 25 at 22:15 GMT 0.7843 H: 0.7904 L: 0.7829
AUD/USD Technical
| S3 | S2 | S1 | R1 | R2 | R3 |
| 0.7550 | — | — | 0.7850 | 0.8200 | — |
During the early hours of the Asian trading session on Thursday, the AUD/USD is consolidating right around the key 0.7850 level after easing back towards the key resistance level after surging higher through the level in the last couple of days. Current range: trading right around 0.7850.
Further levels in both directions:
• Below: 0.7550.
• Above: 0.7850 and 0.8200.
OANDA’s Open Position Ratios
(Shows the ratio of long vs. short positions held for the AUD/USD among all OANDA clients. The left percentage (blue) shows long positions; the right percentage (orange) shows short positions.)
The long position ratio for the AUD/USD has fallen back towards 50% as the Australian dollar has eased a little after rallying higher to above 0.79. The trader sentiment remains in favour of long positions.
Economic Releases
- 23:30 (Wed) JP CPI Core (Nation) (Feb)
- 23:30 (Wed) JP CPI Core (Tokyo) (Mar)
- 23:30 (Wed) JP Real Household Spending (Feb)
- 23:30 (Wed) JP Unemployment (Feb)
- 23:30 (Wed) JP Large Retailers Sales (Feb)
- 23:30 (Wed) JP Retail Sales (Feb)
- 09:00 EU M3 Money Supply (sa) (Feb)
- 09:30 UK Retail Sales (Feb)
- 12:30 US Initial Claims (21/03/2015)