By Fast Brokers – The Aussie is mimicking action taking place in the risk trade across the board by hovering around a psychological level, in this case .93. Activity in the FX market is relatively subdued today due to the lack of economic data. Additionally, psychological forces have cooled down a bit so far today, allowing the dollar to take a break from recent volatility. Meanwhile, the Aussie is still sitting in a strong position after reacting positively to the RBA’s somewhat hawkish policy stance. As we explained in yesterday’s commentary, demand for Australia’s commodities is making the RBA stay aggressive in countering price increases. Hence, the central bank doesn’t seem opposed to raising rates again over the next two meetings if growth in emerging economies stays on track. Regardless, investors don’t have much economic data to judge Australia by today, meaning psychological forces should stay in the driver’s seat for the time being. That being said, even though the Aussie is exhibiting a relative strength, developments effecting the dollar could still impact the Aussie as well. Therefore, investors should keep a close eye on the dollar’s reaction to tomorrow’s busy day of data. Also, many psychological events have been popping up around the globe lately, so activity could pick up tomorrow regardless.
Technically speaking, the Aussie faces technical barriers in the form of 4/15 and 4/12 highs. Additionally, the psychological .93 and .94 levels could serve as psychological obstacles over the near-term. As for the downside, the Aussie has multiple uptrend lines serving as technical cushions along with 4/13 and 4/19 lows.
Price: .9293
Resistances: .9306, .9316, .9329, .9343, .9353, .9364
Supports: .9292, .9282, .9270, .9257, .9245, .9234
Psychological: .93, .94, .92, April highs and lows
(click chart to enlarge)
Market Commentary provided by Fast Brokers.
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