By Fast Brokers – The Aussie has brushed aside concerns about China and Goldman, registering a sizable v-shaped recovery from yesterday’s lows. The Aussie has experienced considerable strength following the release of the RBA’s minutes from its previous monetary policy meeting. The RBA implied that it is not opposed to raising rates further should demand for Australia’s commodities stay strong. This depends a lot on China’s economic performance, so investors should keep an eye on fundamental data over the medium-term should the recent clampdown on the real-estate industry curtail GDP. As for the time being, as long as the RBA stays hawkish the Aussie could outperform. However, it will be interesting to see with Australia’s upcoming fundamental releases show any signs of easing under the pressure of higher interest rates. Additionally, we have seen the impact psychological news from China can have on the Aussie, so investors should keep a close eye on the news wire. Although Australia will release its MI leading index tomorrow, more emphasis will likely be placed on the UK’s CCC data followed by Bernanke’s testimony. Meanwhile, U.S. earnings will continue to hit the wire, and with psychological developments up in the air around the globe the FX markets have the potential to jolt to life unexpectedly, so investors should remain on their toes.
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: .9306
Resistances: .9316, .9329, .9343, .9353, .9364, .9383
Supports: .9294, .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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