23 Jan 2014
China HSBC PMI next: AUD/USD reaction
FXstreet.com (Bali) - Even if the hot CPI number from yesterday may have put the AUD/USD in a better technical position to face the Chinese HSBC PMI, the truth is that the outlook for the pair has deteriorated since the CPI-induced rally, as sellers camped around 0.8880/90 snapped price back to 0.8830 ahead of the risk event, with bids so far holding the key support.
5 Scenarios - Forex Crunch
As Kenny Fischer from Forex Crunch notes: "With QE a reality in the US and another taper expected in the near future, the Aussie could lose more ground. The currency continues to be weighed down by the RBA, which has made no secret that it wants the Australian dollar trading at lower levels. So, the overall sentiment is bearish on AUD/USD towards this release."
Kenny takes the following technical levels, from top to bottom: 0.9180, 0.9000, 0.8893, 0.8728, 0.8578 and 0.8432.
Within expectations: 53.0 to 56.0: In such a case, AUD/USD is likely to rise within range, with a small chance of breaking higher.
Above expectations: 56.1 to 59.0: An unexpected higher reading can send the pair above one resistance line.
Well above expectations: Above 59.0: Such an outcome would likely push the pair upwards, and a second resistance line might be broken as a result.
Below expectations: 50.0 to 52.9: A weaker reading than forecast could push AUD/USD downwards and break one level of support.
Well below expectations: Below 50.0: A reading below the 50 line would indicate contraction in the Chinese manufacturing sector and could see the pair break below a second support level.
5 Scenarios - Forex Crunch
As Kenny Fischer from Forex Crunch notes: "With QE a reality in the US and another taper expected in the near future, the Aussie could lose more ground. The currency continues to be weighed down by the RBA, which has made no secret that it wants the Australian dollar trading at lower levels. So, the overall sentiment is bearish on AUD/USD towards this release."
Kenny takes the following technical levels, from top to bottom: 0.9180, 0.9000, 0.8893, 0.8728, 0.8578 and 0.8432.
Within expectations: 53.0 to 56.0: In such a case, AUD/USD is likely to rise within range, with a small chance of breaking higher.
Above expectations: 56.1 to 59.0: An unexpected higher reading can send the pair above one resistance line.
Well above expectations: Above 59.0: Such an outcome would likely push the pair upwards, and a second resistance line might be broken as a result.
Below expectations: 50.0 to 52.9: A weaker reading than forecast could push AUD/USD downwards and break one level of support.
Well below expectations: Below 50.0: A reading below the 50 line would indicate contraction in the Chinese manufacturing sector and could see the pair break below a second support level.