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3 Mar 2014
AUD/USD bounces off 0.8930
FXStreet (Edinburgh) - After bottoming out near 0.8890, the AUD/USD sparked a correction lower to the current area of 0.8925/30 on Monday.
AUD/USD lower on risk aversion
The day started with safer assets on the rise after tensions on the Russia-Crimea situation spooked investors and dragged spot to test fresh 4-week lows in sub-0.89 levels. News from China showed that February’s manufacturing PMIs – gauged by NBS and HSBC – matched expectations over the weekend, albeit coming in lower than January’s. In the domestic docket, the Performance of Mfg Index sponsored by AiG climbed to 48.6 from 46.7 for the month of February while TD Securities Inflation advanced 2.7% on a year to February; New Home Sales tracked by HIA gained 0.5% inter-month vs. a 0.4% drop previous. “The initial target is in the $0.8840-80 band. In the bigger picture, though the month-long rally is likely over and the longer term down trend may be resuming. Fundamentally, the market has taken on board the neutral RBA, but weak data and slowing of its largest trading partner may spur expectations of another cut in late Q2 or Q3. A move back above $0.9000 would help improve the technical tone”, argued analysts at BBH.
AUD/USD key levels
The pair is now flat at 0.8923 with the next resistance at 0.9026 (high Feb.26) followed by 0.9044 (high Feb.25) and then 0.9050 (high Feb.24). On the flip side, the initial support aligns at 0.8910 (50-d MA).
AUD/USD lower on risk aversion
The day started with safer assets on the rise after tensions on the Russia-Crimea situation spooked investors and dragged spot to test fresh 4-week lows in sub-0.89 levels. News from China showed that February’s manufacturing PMIs – gauged by NBS and HSBC – matched expectations over the weekend, albeit coming in lower than January’s. In the domestic docket, the Performance of Mfg Index sponsored by AiG climbed to 48.6 from 46.7 for the month of February while TD Securities Inflation advanced 2.7% on a year to February; New Home Sales tracked by HIA gained 0.5% inter-month vs. a 0.4% drop previous. “The initial target is in the $0.8840-80 band. In the bigger picture, though the month-long rally is likely over and the longer term down trend may be resuming. Fundamentally, the market has taken on board the neutral RBA, but weak data and slowing of its largest trading partner may spur expectations of another cut in late Q2 or Q3. A move back above $0.9000 would help improve the technical tone”, argued analysts at BBH.
AUD/USD key levels
The pair is now flat at 0.8923 with the next resistance at 0.9026 (high Feb.26) followed by 0.9044 (high Feb.25) and then 0.9050 (high Feb.24). On the flip side, the initial support aligns at 0.8910 (50-d MA).