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6 May 2013
Forex: AUD/USD closes sharply higher as US jobs data boosts “risk on” sentiment
FXstreet.com (Barcelona) - The Aussie closed the day sharply higher, finishing up 70 pips at 1.0317. A day of “risk on” sentiment was a supporting factor after the better than expected US Jobs data seemed to help propel the pair higher early in the New York session. Later in the session we will see the AUD Retail Sales release, which could have an impact on the upcoming RBA Rate Decision on May 7th at 4:30GMT.
According to analysts at NAB Global Markets, “Today in Australia, a crucial data release ahead of the RBA meeting
tomorrow. We expect retail sales for March to fall by 1.0%, after the very strong growth of 1.2% and 1.3% in the previous two months. Our NAB Business Survey showed weak Business Conditions for retailing in March and Trading Conditions for Retailers plunged. But the median forecast for retail sales is a 0.1% gain, so a negative outcome would likely see markets raise their expectation of a rate cut tomorrow (currently priced at a 60% chance). But the key question is whether the RBA has seen enough weakness recently or whether it wants to wait another month and see if the softness continues, before cutting again.”
From a technical perspective, the lack of over-all trend continues with the ADX (7) value now registering a value of 12 on the weekly chart. This is an extremely low reading and cautions against buying strength or selling weakness as the pair is most likely to stay rand bound for the time being. Initial resistance sits at 1.0330 (previous support, now resistance on 1 hour chart), while first support sits at 1.0284 (the 20dma on 1 hour chart).
According to analysts at NAB Global Markets, “Today in Australia, a crucial data release ahead of the RBA meeting
tomorrow. We expect retail sales for March to fall by 1.0%, after the very strong growth of 1.2% and 1.3% in the previous two months. Our NAB Business Survey showed weak Business Conditions for retailing in March and Trading Conditions for Retailers plunged. But the median forecast for retail sales is a 0.1% gain, so a negative outcome would likely see markets raise their expectation of a rate cut tomorrow (currently priced at a 60% chance). But the key question is whether the RBA has seen enough weakness recently or whether it wants to wait another month and see if the softness continues, before cutting again.”
From a technical perspective, the lack of over-all trend continues with the ADX (7) value now registering a value of 12 on the weekly chart. This is an extremely low reading and cautions against buying strength or selling weakness as the pair is most likely to stay rand bound for the time being. Initial resistance sits at 1.0330 (previous support, now resistance on 1 hour chart), while first support sits at 1.0284 (the 20dma on 1 hour chart).