AUD/USD - Aussie Posts Gains As U.S. Retail Sales Softens

 |  Includes: FXA, UDN, UUP
by: Dean Popplewell

By Kenny Fisher

AUD/USD has posted gains on Wednesday, as the pair trades in the low -0.93 range early in the North American session. The Aussie gained ground following weak numbers from US Retail Sales and Core Retail Sales, as both indicators softened in July and missed their estimates. Earlier in the day, Australian Westpac Consumer Sentiment impressed the markets, jumping 3.8%. Wage Price Index could not keep up, and dipped to 0.6%, short of the estimate.

Australian data has enjoyed a strong week. On Wednesday, Westpac Consumer Sentiment climbed 0.8%, its strongest gain since October 2012. Stronger consumer confidence often translates into increased consumer spending, a key component for economic growth. Wage Price Index, an important gauge of inflationary pressure, dropped to 0.6%, short of the estimate of 0.8%. Earlier in the week, NAB Business Confidence and HPI posted strong gains.

In the US, JOLTS Job Openings improved to 4.67 million, its third consecutive gain from the previous release. However, this fell short of expectations, as the estimate stood at 4.74 million. In the US, employment indicators are under the market microscope, as the strength of the labor market is one of the most important factors influencing the Federal Reserve regarding the timing of an interest rate hike. A rate increase is expected by mid-2015, but stronger economic data, especially on the employment front, could hasten a move by the Fed.

AUD/USD for Wednesday, August 13, 2014

AUD/USD August 13 at 13:50 GMT

AUD/USD 0.9316 H: 0.9320 L: 0.9265

AUD/USD Technical

S3 S2 S1 R1 R2 R3
0.9020 0.9119 0.9229 0.9361 0.9446 0.9617
Click to enlarge
  • AUD/USD has posted gains in the Asian and European sessions. The pair is steady early in the North American session.
  • On the downside, 0.9229 has some breathing room following gains by the Australian dollar.
  • 0.9361 is an immediate resistance line. 0.9446 is next.
  • Current range: 0.9229 to 0.9361

Further levels in both directions:

  • Below: 0.9229, 0.9119, 0.9020 and 0.8916
  • Above: 0.9361, 0.9446, 0.9617 and 0.9757

OANDA's Open Positions Ratio

AUD/USD ratio is pointing to gains in short positions on Wednesday. This is not consistent with the movement of the pair, as the Australian dollar has posted gains. The ratio has a majority of long positions, indicative of trader bias towards the Australian dollar continuing to move to higher ground.

AUD/USD Fundamentals

  • 00:30 Australian Westpac Consumer Sentiment. Actual 3.8%.
  • 1:30 Australian Wage Price Index. Estimate 0.8%. Actual 0.6%.
  • 12:30 US Core Retail Sales. Estimate 0.4%. Actual 0.1%.
  • 12:30 US Retail Sales. Estimate 0.2%. Actual 0.0%.
  • 13:05 FOMC Member William Dudley Speaks.
  • 14:00 US Business Inventories. Estimate 0.4%. Actual 0.4%.
  • 14:30 US Crude Oil Inventories. Estimate -0.8M.
  • 17:01 US 10-year Bond Auction.

* Key releases are highlighted in bold

*All release times are GMT

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.