Technical Analysis AUD/USD for July 11, 2014

AUD/USD has edged higher in Friday trade, as the pair trades at the 0.94 in the European session. On the release front, there are no key events on the schedule. In Australia, Home Loans beat the estimate. In the US, Friday’s lone release is the Federal Budget Balance, a minor event.

Australian Home Loans is an important gauge of activity in the housing sector. The indicator posted a flat reading of 0.0% for the second straight month. This surprised the markets, which had expected a reading of -0.6%. On Thursday, Australian employment data was a mix. Employment Change rebounded in May with a strong gain of 15.9 thousand, easily beating the estimate of 12.3 thousand. At the same time, Unemployment Rate rose to 6.0%, the highest level seen since February. This edged above the estimate of 5.9%. Earlier in the week, there were solid consumer and business confidence levels, which are important catalysts for economic growth. NAB Business Confidence hit its highest level since January, while Westpac Consumer Confidence gained 1.9%, an eight-month high.

In the US, Unemployment Claims dropped, as the economy continues to churn out solid employment numbers. The key indicator dropped to 304 thousand, well below the estimate of 316 thousand. Employment numbers for June have looked sharp, led by a jump in Nonfarm Payrolls and a drop in the unemployment rate. The strong employment numbers have increased speculation about an interest rate hike by the Federal Reserve, and remarks by Fed policymakers will be under the market microscope.

The Federal Reserve minutes did not shed much light on when the Fed plans to raise interest rates, but policymakers did agree to wind up the QE scheme by October. The asset purchase program flooded the economy with over $2 trillion, and the Fed has been steadily reducing the program since last December. Winding down QE will require several more tapers by the Fed, but that shouldn’t pose a problem, given the solid employment data the economy has been churning out.

AUD/USD for Friday, July 11, 2014

AUD/USD July 11 at 10:40 GMT

AUD/USD 0.9400 H: 0.9406 L: 0.9378

AUD/USD Technical

• AUD/USD has edged upwards in the Asian and European sessions.
• 0.9361 is providing weak support. There is stronger support at 0.9229.
• 0.9446 is the next resistance line. This is followed by resistance at 0.9617.

Further levels in both directions:

• Below: 0.9361, 0.9229, 0.9119 and 0.9000
• Above: 0.9446, 0.9617, 0.9757 and 0.9842

 

AUD/USD Fundamentals

• 1:30 Australian Home Loans. Actual 0.0%. Estimate -0.6%.
• 18:00 US Federal Budget Balance. Estimate 79.5B.
  

*Key releases are highlighted in bold.

*All release times are GMT

Source: marketpulse

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