By Fast Brokers – The Aussie is heading higher and testing weekly highs as the risk trade rallies in reaction to strong Manufacturing PMI data from around the globe. Both China and Japan’s manufacturing data met estimates, a positive development for the Aussie since China is driving demand for Australia’s commodities. In fact, Australia’s trade deficit came in higher than anticipated today amid an increase in imports, particularly heavy machinery for mining operations. Hence, demand for Australia’s commodities remains plentiful, a positive for the Aussie when the RBA makes it next monetary policy decision. However, recent data from Australia has been somewhat disappointing, including yesterday’s Retail Sales and Building Approvals data. Hence, the RBA could be hesitant in raising rates further, which is likely keeping the Aussie in check thus far today. All eyes will be on the U.S. tomorrow with Non-Farm Employment Change and headline Unemployment Rate figures on deck. Many investors will take off for the holiday weekend, meaning volatility could increase due to the combination of light volume and key fundamental data. Hence, investors should keep a close eye on the Dollar’s reaction to tomorrow’s U.S. data set.
Technically speaking, despite today’s upward movement in the Aussie the currency pair still faces technical barriers in the form of 3/19 and 3/17 highs. Additionally, the psychological .92 area could influence the Aussie over the near-term. As for the downside, the Aussie has multiple uptrend lines serving as technical cushions along with intraday and 3/31 lows.
Price: .9202
Resistances: .9214, .9230, .9247, .9264, .9278
Supports: .9194, .9185, .9173, .9161, .9143, .9130
Psychological: .91, .92 March Lows and Highs
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