- Dollar soars across the board on US data.
- The Aussie is under pressure against the dollar ahead of the RBA.
- AUD/USD falls more than a hundred points from the monthly highs to the lows since Wednesday.
The AUD/USD it continued to fall after breaking below 0.6800 and recently reached its low since Wednesday at 0.6740. The pair remains near the bottom, under pressure amid an overall stronger US dollar following US economic data.
Good US data is bad news for Wall Street
US economic data beat expectations on Monday, helping the dollar. The S&P Global Composite PMI for November was revised from the preliminary reading of 46.3 to 46.4. October factory orders rose 1%, beating expectations for a 0.7% increase. The November ISM Services PMI rose from 54.4 to 56.5. The prices paid index fell from 70.7 to 70.
Following the latest reports, the dollar gained momentum across the board and hit new all-time highs. Metals extended their slide and US stocks hit new lows.
The RBA is next
On Tuesday, the Reserve Bank of Australia (RBA) will announce its decision on monetary policy. Consensus is for a 25 basis point rate hike. The decision and guidance offered in the release will likely have a major impact on the Aussie.
“The statement would be dovish if the Bank says it will assess data over the holidays to determine its next cash rate move. Alternatively, the Bank explicitly stating 300 basis points of cumulative hikes would also dovish (the RBA assumed 300 basis points for July 23)”, explain the analysts of TD Securites.
Short-term technical outlook
AUD/USD has undergone a sharp reversal and the outlook has deteriorated considerably for bulls. A recovery above 0.6800 would shift momentum towards the Aussie. Above the resistance lies 0.6820. If the pair sustains above 0.6840, a retest of the recent high at 0.6850 seems likely.
On the other hand, a support zone emerges around 0.6720. A break down would put attention at 0.6700 and the next barrier would be at 0.6665.
|Last price today||0.678|
|today’s daily change||-0.0024|
|Today’s daily change in %||-0.35|
|today’s daily opening||0.6804|
|previous daily high||0.6836|
|previous daily low||0.6742|
|Previous Weekly High||0.6845|
|previous weekly low||0.664|
|Previous Monthly High||0.6801|
|Previous monthly minimum||0.6272|
|Daily Fibonacci of 38.2%||0.6778|
|Daily Fibonacci of 61.8%||0.68|
|Daily Pivot Point S1||0.6752|
|Daily Pivot Point S2||0.67|
|Daily Pivot Point S3||0.6658|
|Daily Pivot Point R1||0.6846|
|Daily Pivot Point R2||0.6888|
|Daily Pivot Point R3||0.694|
Source: Fx Street
I am a writer for World Stock Market. I have been working in finance for over 7-8 years, and I have experience with a variety of financial instruments. My work has taken me to Japan, China, Europe, and the United States. I speak Japanese and Chinese fluently.