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My name is Martin, from Cape Town, ZA. I'm the Co-Founder and Chief Editor of the growing Traders Community. I've an experience of over 8 years in Forex as a Portfolio manager, Trader and guest writer for many financiel and forex websites such as,... More
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  • Australia Currency Outlook And Short Term Forecasts 0 comments
    Mar 28, 2013 12:42 PM

    Forex and binary options traders who follow the AUD/USD pair closely have surely noticed that the pair remained relatively stable over the last couple of weeks. The lack of any significant events made ample swings impossible and even when one currency gained value over the over, it soon returned to the previous values. The question is whether this eerie balance will be maintained over the next few weeks, or if some events will trigger a change that traders could take advantage of.

    Mixed Australian Data Makes Forecasts Difficult

    Binary options traders who use solely technical analysis are probably puzzled by the recent moves of the AUD/USD pair and have very little data to work with. The pair closed last week at 1.023 and the contradictory Australian data makes it even more difficult to come up with a convincing trading advice. On one hand, put options with a short expiration date are suggested by the fact that the trade balance and building approvals data failed to meet expectorations. On the other hand some encouraging news came from the retail sales, and what the AUD lost initially, it regained in a matter of days.

    Looking back at what happened in January and February, it is hard not to notice the fact that the business confidence increased considerably. It soared by three points and if the growth proves to be sustainable, the markets will react positively in March and the currency pair will not remain immune to these moves. Equally important is the consumer sentiment and in this particular case the reports are not as encouraging, with the indicators being highly volatile in February. It ended up on a positive note, but with high expectations come high disappointments so traders shouldn't count on it exclusively.

    The Impact Of Home Loans And Employment Change

    These two indicators need to be factored in by those who intend to trade AUD/USD, because they carry the same weight in both Australia and United States. The American figures are encouraging and show that the economy created more jobs than expected, so Australia is hard pressed to come up with equally solid figures. The home loans gained a bit in February so the surge was well below 1%, but the markets reacted positively because this was the first increase this year.

    In terms of employment, very little changed and the number of newly employed people was in line with the estimates, and revolved around 10,700 The numbers are not significant enough to cause amble movements in either direction and neither is this inflation expectation for March. It comes as no surprise that the currency pair hasn't been to attractive for binary options traders and it is expected for it to remain just as stable. At least on short term there is no reason to take any chances and those who choose to stay away from the AUD/USD are doing the right choice.

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