AUD/USD ANALYSIS & TALKING POINTS
- Australian wage growth the highest since 2009.
- Focus now shifts to US PPI and retail sales data.
- AUD/USD bulls look to break 0.65 handle.
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AUSTRALIAN DOLLAR FUNDAMENTAL BACKDROP
The Australian dollar remains buoyant this morning after yesterday’s rally post-CPI that saw the greenback sell off. Optimistic Chinese economic data (see economic calendar below) supplemented Australian wage growth figures that grew at its fastest pace since 2009. If this translates through to sticky inflation, the Reserve Bank of Australia’s (RBA) may need to tighten monetary policy further.
Precious and base metals are broadly higher adding to AUD upside today ahead of US PPI and retail sales. PPI is generally seen as a leading indicator that could give an indication as to inflation (CPI) going forward. If actual data falls in line with estimates, the US dollar may weaken further.
AUD/USD ECONOMIC CALENDAR (GMT +02:00)
Source: DailyFX economic calendar
TECHNICAL ANALYSIS
AUD/USD DAILY CHART
Chart prepared by Warren Venketas, TradingView
AUD/USD price action shows the pair back at the 0.6500 psychological level once again. The level has held firm since mid-August but may be giving way soon. The next zone under scrutiny will be the 200-day moving average (blue) from a bullish perspective but a close above the November swing high is needed before bulls can push the pair higher.
Key resistance levels:
Key support levels:
IG CLIENT SENTIMENT DATA: BULLISH (AUD/USD)
IGCS shows retail traders are currently net LONG on AUD/USD, with 62% of traders currently holding long positions.
Download the latest sentiment guide (below) to see how daily and weekly positional changes affect AUD/USD sentiment and outlook.
Introduction to Technical Analysis
Market Sentiment
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