AUD/USD Forecast for the Week of May 28, 2012, Technical Analysis

The AUD/USD pair fell for much of the week to form a bearish candle. The candle is a weak one, but isn’t as bad as it could have been, as the 0.97 level held up for the bulls. The level looks like a serious one, and we have to see this pair close below it in order to continue the down trend at this point. The buying of this pair isn’t a trade that we are willing to take until we clear the 1.02 level as the market has many minor resistance levels until we get above that mark. Also, there are a lot of headline risks out there that could push this pair much lower. We are willing to sell this market on a close below 0.97, and a rally that looks weak.

 

AUD/USD Forecast for the Week of May 28, 2012, Technical Analysis
AUD/USD Forecast for the Week of May 28, 2012, Technical Analysis

AUD/USD Forecast May 28, 2012, Technical Analysis

The AUD/USD pair had a volatile session on Friday only to end up unchanged at the end of the session. The 0.97 level looms large as support below, and this has kept the sellers at bay so far. However, the fact that there simply hasn’t been a rally of any significance at this area suggests that we will see lower prices. The breaking and a daily close sub-0.97 has us selling this pair. With the “risk off” attitude of the markets, it is hard to see the Aussie suddenly becoming desired. Rallies will also be sold on weak candles.

 

AUD/USD Forecast May 28, 2012, Technical Analysis
AUD/USD Forecast May 28, 2012, Technical Analysis

AUD/USD Weekly Fundamental Analysis May 28 – June 1, 2012, Forecast

Introduction:  The Australian dollar still isn’t in its good old days, but the performance is definitely improving. Resistance lines tend to work in a smoother manner than support lines, but they also work well. The pair move well together, not much volatility, but easy to chart and easy to trade with low risk factors.

Weekly Analysis and Recommendation:

The AUD/USD closed a rocky week at 0.9768 which saw it continue to tumble. Unfortunately the strength of the USD as markets remained in risk aversion mode and negative eco data from Australia, the Aussie had very little chance to gather any strength. The Aussie is still recovering from the RBA rate reduction and growth reductions.

This week’s prices are shown below:

Highest: 0.9935

Lowest: 0.9690

Difference: 0.0245

Average: 0.9787

Change %: -1.58

Commodity currencies this week were stuck between the USD and the JPY as investors ran for cover over concerns with Greece’s possible exit from the euro and the growing problems with Spanish banks. The markets were also upset by statements from the IMF, the OECD, the World Bank and the IIF, all trying to push the EU into some plan of action. After the much expected EU mini summit with the disappointing conclusion, investors shied away from everything associated with the EU as the euro plummeted to record lows.

All the pacific nations and commodity currencies suffered.

Asian markets will have little capacity to influence the global tone with the possible exception of China’s state version of the purchasing managers’ index that is due out on Thursday night.  Consensus is expecting a modest drop to a still expansionary reading that lies at odds with the private sector PMI which remains in contraction, and with hard data on industrial production that has slowed markedly into the New Year.  Indian Q1 GDP is expected to come in at 6% y/y which would remain among the weakest growth rates of the past decade.  Japanese household spending, retail trade, industrial production and housing starts are also on next week’s schedule. RBA Governor Glenn Stevens’ delivers a speech into the Monday market open ahead of the June 5th RBA rate decision that consensus expects will yield no change in the cash target rate of 3.75%.  The RBA has cut by 100bps since October in two moves.

Major Economic Events for the week of May 21-25 actual v. forecast for Yen, the Aussie and the Kiwi

Currency

 

Actual

Forecast

Previous

NZD

Inflation Expectations q/q

2.4%

 

2.5%

JPY

Trade Balance

-0.48T

-0.60T

-0.62T

AUD

CB Leading Index m/m

0.2%

 

0.0%

AUD

MI Leading Index m/m

0.4%

 

0.0%

JPY

Overnight Call Rate

<0.10%

<0.10%

<0.10%

NZD

Trade Balance

355M

445M

186M

JPY

Tokyo Core CPI

-0.8%

-0.6%

-0.5%

 

Economic Highlights of the coming week that affect the AUD, JPY, NZD and USD

Date

Time

Currency

 

Previous

May 28

23:30

JPY

Household Spending y/y

3.4%

23:50

JPY

Retail Sales y/y

10.3%

May 29

TBD

AUD

HIA New Home Sales m/m

-9.4%

13:00

USD

S&P/CS Composite-20 HPI y/y

-3.5%

14:00

USD

CB Consumer Confidence

69.2

22:45

NZD

Building Consents m/m

19.8%

May 30

1:30

AUD

Retail Sales m/m

0.9%

1:30

AUD

Construction Work Done q/q

-4.6%

14:00

USD

Pending Home Sales m/m

4.1%

23:50

JPY

Prelim Industrial Production m/m

1.3%

May 31

1:00

NZD

NBNZ Business Confidence

35.8

1:30

AUD

Building Approvals m/m

7.4%

1:30

AUD

Private Capital Expenditure q/q

-0.3%

1:30

AUD

Private Sector Credit m/m

0.4%

1:30

JPY

Average Cash Earnings y/y

1.3%

12:15

USD

ADP Non-Farm Employment Change

119K

12:30

USD

Prelim GDP q/q

2.2%

12:30

USD

Unemployment Claims

370K

13:45

USD

Chicago PMI

56.2

15:00

USD

Crude Oil Inventories

0.9M

23:50

JPY

Capital Spending q/y

7.6%

Jun 1

12:30

USD

Non-Farm Employment Change

115K

12:30

USD

Unemployment Rate

8.1%

12:30

USD

Core PCE Price Index m/m

0.2%

12:30

USD

Personal Spending m/m

0.3%

14:00

USD

ISM Manufacturing PMI

54.8

Upcoming Government Bond Auctions

Date Time Country 

May 28- n/a  UK

May 28  09:10  Italy

May 29  00:30  Japan

May 29  09:10  Italy

May 29  09:10  Norway

May 30  09:10  Italy

May 30  09:10  Sweden 

AUD/USD Fundamental Analysis May 28, 2012 Forecast

Analysis and Recommendation: (close of Asian session)

The AUD/USD is trading at 0.9748 slightly off, after being weighed down by poor manufacturing data from Europe and China.

The Australian economy is so dependent on China and its exports to Europe, that the ongoing crisis in Europe is having negative effects on the AUD. The slowdown in China continues to slow growth and business in its local neighbors who are dependent on their exports to China.

With the lack of any results at the EU summit, markets are worried about how long it will take for Europe to pull themselves out of this economic fog and the contagion effect to surrounding nations and the economic future of import and export countries dependent on trade in Europe.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.

Economic Data for May 24-25 actual v. forecast

Date

 

Currency

 

 

Event

Actual

 

Forecast

 

Previous

 

 

 

 

EUR

 

 

German GDP (QoQ) 

0.5%

 

0.5% 

 

0.5% 

 

 

 

 

EUR

 

 

French Manufacturing PMI 

44.4

 

47.0 

 

46.9 

 

 

 

 

EUR

 

 

German Manufacturing PMI 

45.0

 

47.0 

 

46.2 

 

 

 

 

EUR

 

 

German Ifo Business Climate Index 

106.9

 

109.4 

 

109.9 

 

 

 

 

EUR

 

 

Manufacturing PMI 

45.0

 

46.1 

 

45.9 

 

 

 

 

EUR

 

 

German Current Assessment 

113.3

 

117.4 

 

117.5 

 

 

 

 

EUR

 

 

German Business Expectations 

100.9

 

102.0 

 

102.7 

 

 

 

 

GBP

 

 

BBA Mortgage Approvals 

32.4K

 

32.3K 

 

31.9K 

 

 

 

 

GBP

 

 

Business Investment (QoQ) 

3.6%

 

3.2% 

 

-3.3% 

 

 

 

 

GBP

 

 

GDP (QoQ) 

-0.3%

 

-0.2% 

 

-0.2% 

 

 

 

 

USD

 

 

Durable Goods Orders (MoM) 

0.2%

 

0.5% 

 

-3.7% 

   

 

 

USD

 

 

Initial Jobless Claims 

370K

 

370K 

 

372K 

   

 

 

USD

 

 

Continuing Jobless Claims 

3260K

 

3250K 

 

3289K 

   

May 25

 

JPY

 

 

Tokyo Core CPI (YoY) 

-0.8%

 

-0.6% 

 

-0.5% 

 

 

 

Upcoming Economic Events that affect the AUD, NZD, JPY and USD

Date

Cur.

Event

Forecast

Previous

 

May 28

 JPY

Unemployment Rate

4.5%

4.5%

 

 

 

 JPY

Retail Sales (YoY)

6.3%

10.3%

 

 

Date  Time  Country 

May 28- n/a  UK

May 28  09:10  Italy

May 29  00:30  Japan

May 29  09:10  Italy

May 29  09:10  Norway

May 30  09:10  Italy

May 30  09:10  Sweden 

 

AUD/USD Forecast May 25, 2012, Technical Analysis

The AUD/USD pair rose during the session on Thursday, but failed to make a strong statement. The resulting candle for the session is a shooting star at the bottom of this fall, and this is one of the most bearish signals we know of if it gets triggered. A break of the lows from the Wednesday session, and more importantly the 0.97 level, we will see continued pressure to the downside. This pair is certainly one that we aren’t willing to buy at this point, and a falling would have us selling this pair aggressively under the 0.97 level.

 

AUD/USD Forecast May 25, 2012, Technical Analysis
AUD/USD Forecast May 25, 2012, Technical Analysis

AUD/USD Forecast May 24, 2012, Technical Analysis

The AUD/USD pair fell hard for most of the session as the “risk off” trade was the main theme for the day. However, in the late hours the Americans decided to take the words of the French and Italians as a sign that Eurobonds are coming. This is a problem though, as the Germans are against it, as well as the Finns, Dutch, and Austrians. Guess who would have to back those large bonds? Yep, the ones who oppose it. It’s easy for those that need money to agree that they should have their neighbors cosign for the loan. This only drives home the point on how the European Union should have at least two currencies.

The announcement will come after this article is written, but the odds are that disappointment will follow. If we get a pop in this pair, it should be thought of as a possible pullback from which to sell from if you have missed the move. The parity and 1.02 levels look very resistive. On a lesser scale, the 0.99 does as well. We are willing to sell on weak action in those areas. Obviously, a fresh new low would have us selling as well. 

AUD/USD Forecast May 24, 2012, Technical Analysis
AUD/USD Forecast May 24, 2012, Technical Analysis

AUD/USD Fundamental Analysis May 25, 2012 Forecast

Analysis and Recommendation: (close of Asian session)

The AUD/USD continues to decline against the USD to reach 0.9742. The Aussie is slightly lower, trading in a tight range throughout the morning, after the release of key Chinese economic data. The HSBC PMI preliminary reading was reported at 48.70, a reading under 50.00 is considered negative and today’s reading was below last month’s also.

Overnight, the Australian dollar fell as low as 96.90 US cents, its lowest level since November 28.

There was not much of a reaction in currency markets after a summit of EU leaders ended. The meeting showed that France and Germany are divided on how to resolve the euro zone debt crisis, particularly on the issue of the European Central Bank issuing its own eurobonds.

This set the tone for the ongoing relationship for Hollande and Merkel.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.

Economic Data for May 23-24 actual v. forecast

   

GBP

 

 

 

Retail Sales (MoM) 

-2.3%

 

-0.8% 

 

2.0% 

 

 

 

 

GBP

 

 

 

Retail Sales (YoY) 

-1.1%

 

1.0% 

 

3.1% 

   

 

 

EUR

 

 

 

Industrial New Orders (MoM) 

1.8%

 

-0.1% 

 

-1.2% 

 

 

 

 

GBP

 

 

 

CBI Industrial Trends Orders 

-17

 

-10 

 

-8 

 

 

 

 

CAD

 

 

 

Core Retail Sales (MoM) 

0.1%

 

1.0% 

 

0.4% 

   

 

 

CAD

 

 

 

Leading Indicators (MoM) 

0.3%

 

0.3% 

 

0.3% 

   

 

 

CAD

 

 

 

Retail Sales (MoM) 

0.4%

 

0.4% 

 

-0.2% 

 

 

 

 

USD

 

 

 

New Home Sales 

343K

 

335K 

 

332K 

   

 

 

NZD

 

 

 

Trade Balance 

355M

 

500M 

 

186M 

   

May 24

 

CNY

 

 

 

Chinese HSBC Manufacturing PMI 

48.70

 

 

 

49.30 

   

  

Upcoming Economic Events that affect the AUD, NZD, JPY and USD

May 25

TBD

ALL

 

G8 Meetings

     

13:55

USD

 

Revised UoM Consumer Sentiment

     

 

In The Eyes of the Experts – 23/5/2012

What is this report?

In the morning the experts meet in the dealing room in order to prepare themselves for another trading day. They read the business press, and note relevant economic announcements expected during the day. They also consider the support and resistance lines and discuss the important rates in the major pairs; they indicate which pairs may strengthen and those which could weaken. Afterwards they wish everyone a successfully day of trading and turn on the computer screens…

Below you can find pairs the experts assume may be strengthen and weaken during the trading day; support and resistance lines relevant to the day’s trading and critical time for trading each day (important news etc.).

Currencies to watch for Long:

  • JPY
  • CAD
  • USD

 

Currencies watch for Short:

  • GBP
  • NZD
  • JPY

 

Today’s important times (GMT+2):

  • 11:30 GBP
  • 15:30 CAD
  • 17:00 USD
  • All Day EU economic summit

 

Important rates:

Pair R2 R1 Pivot S1 S2
EURUSD    1.2545    1.2602    1.2708    1.2765    1.2871   
GBPUSD 1.5673 1.5714 1.5780 1.5821 1.5888
USDJPY 78.96 79.48 79.80 80.32 80.65
USDCHF 0.9330 0.9407 0.9449 0.9526 0.9568
USDCAD 1.0119 1.0170 1.0201 1.0252 1.0283
AUDUSD 0.9646 0.9707 0.9820 0.9881 0.9994

AUD/USD Fundamental Analysis May 24, 2012 Forecast

Analysis and Recommendation: (close of Asian session)

The AUD/USD continues to fall, trading at 0.9771 as Asian markets close for the day.

The risk aversion mode of the markets continues to push the USD to dominate all of its trading partners.

Over the past week, there has been a fine balance between the moves to safety of the USD and the JPY. With recent downgrades by Fitch and Mood’s and the move to negative outlook, markets have pulled back from the JPY giving unlimited strength to the USD, which has been weighing on all commodities currencies and commodities.

Yesterday, the OECD report warned on contagion from the EU and the seriousness of the EU financial situation. With the EU summit beginning today, investors will pay great heed to news from Brussels.

Greece also continues to weigh on the global markets as fears of withdrawal from the euro in a disorderly fashion could cause upheaval in Europe.

From China the closely-watched private sector PMI tracking China’s manufacturing sector will be released overnight. While the PMI increased from a reading of 48.3 in March to a reading of 49.3 in April, the larger story is that the PMI has been below the ‘break-even’ level of 50 for six consecutive months. With markets so attuned to any hints – positive or negative – out of China, moves in this indicator have the potential to have a meaningful impact on markets. China will focus on correctly managing the relationship between maintaining stable, relatively fast economic growth, restructuring the economy and managing inflation expectations, Chinese Vice Premier Li Keqiang said, according to a statement posted on the government website late Tuesday

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.

Economic Data for May 22-23, 2012 actual v. forecast

Date

 

Currency

 

 

Event

Actual

 

Forecast

 

Previous

 

 

 

 

GBP

 

 

CPI (MoM) 

0.6%

 

0.6% 

 

0.3% 

 

 

 

 

USD

 

 

Existing Home Sales 

4.62M

 

4.60M 

 

4.47M 

   

May 23

 

JPY

 

 

Trade Balance 

-0.48T

 

-0.60T 

 

-0.62T 

 

 

 

 

JPY

 

 

Interest Rate Decision 

0.10%

 

0.10% 

 

0.10% 

   

 

Upcoming Economic Events that affect the AUD, NZD, JPY and USD

May 24

2:00

NZD

 

Annual Budget Release

     

5:00

JPY

 

BOJ Monthly Report

     

12:30

USD

 

Core Durable Goods Orders m/m

   

-0.8%

12:30

USD

 

Unemployment Claims

     

12:30

USD

 

Durable Goods Orders m/m

   

-4.0%

23:30

JPY

 

Tokyo Core CPI y/y

   

-0.5%

May 25

TBD

ALL

 

G8 Meetings

     

13:55

USD

 

Revised UoM Consumer Sentiment

     

 

 

AUD/USD Forecast May 23, 2012, Technical Analysis

The AUD/USD pair fell on Tuesday as the fears over Europe continue. The former Prime Minister of Greece, Mr. Papademos suggested that the exit risk of Greece out of the European Union was a real threat, and risk related assets fell as a result. Truthfully though, the risk on assets didn’t exactly look overly healthy during the trading day anyhow.

The 0.98 level has been holding the market up lately, but with the recent price action it looks as if a breakdown is only a matter of time. A daily close below that level is a trigger for us to sell. As for buying, we don’t. A rally could also be faded if we get weak action, especially around either the parity or 1.02 levels.

AUD/USD Prices May 23, 2012, Technical
AUD/USD Prices May 23, 2012, Technical

In The Eyes of the Experts – 22/5/2012

What is this report?

In the morning the experts meet in the dealing room in order to prepare themselves for another trading day. They read the business press, and note relevant economic announcements expected during the day. They also consider the support and resistance lines and discuss the important rates in the major pairs; they indicate which pairs may strengthen and those which could weaken. Afterwards they wish everyone a successfully day of trading and turn on the computer screens…

Below you can find pairs the experts assume may be strengthen and weaken during the trading day; support and resistance lines relevant to the day’s trading and critical time for trading each day (important news etc.).

Currencies to watch for Long:

  • USD
  • CAD

 

Currencies watch for Short:

  • GBP
  • NZD
  • JPY

 

Today’s important times (GMT+2):

  • 11:30 GBP
  • 17:00 USD

 

Important rates:

Pair R2 R1 Pivot S1 S2
EURUSD    1.2684    1.2749    1.2786    1.2848    1.2885   
GBPUSD 1.5753 1.5790 1.5815 1.5852 1.5876
USDJPY 78.99 79.19 79.31 79.52 79.64
USDCHF 0.9321 0.9347 0.9392 0.9418 0.9463
USDCAD 1.0113 1.0144 1.0194 1.0225 1.0276
AUDUSD 0.9778 0.9846 0.9881 0.9949 0.9985

AUD/USD Fundamental Analysis May 23, 2012 Forecast

Analysis and Recommendation: (close of Asian session)

The AUD/USD continues to struggle, trading today at 0.9925. The Aussie is higher as hopes grow that Greece will stay in the eurozone and after G8 leaders pushed for a pro-growth strategy to solve the continent’s debt crisis. Coupled with statements from China to do what is necessary to increase GDP, which is a positive for Australia.

Coming off of a relatively quiet news day throughout the world and a very thin eco calendar, markets seem to have calmed down a bit. The eco calendar for the US and Pacific region will heat up starting off the BoJ meetings and several eco reports from Oz.

Also Wednesday we will see the outcome of the EU summit and should start hearing more political rhetoric.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.

Economic Data for May 21- 22, 2012 actual v. forecast

May 21

 

GBP

 

 

Rightmove House Price Index

0.0%

 

 

 

2.9% 

 

 

 

 

CHF

 

 

SECO Consumer Climate 

-8

 

-15 

 

-19 

 

 

May 22

 

NZD

 

 

Inflation Expectations (QoQ) 

2.4%

 

 

 

2.5% 

   

 

Upcoming Economic Events that affect the AUD, NZD, JPY and USD

May 23

0:00

AUD

 

CB Leading Index m/m

   

0.0%

0:30

AUD

 

MI Leading Index m/m

   

0.2%

TBD

JPY

 

Monetary Policy Statement

     

TBD

JPY

 

Overnight Call Rate

   

<0.10%

TBD

JPY

 

BOJ Press Conference

     

14:00

USD

 

New Home Sales

   

328K

14:30

USD

 

Crude Oil Inventories

     

22:45

NZD

 

Trade Balance

   

134M

May 24

2:00

NZD

 

Annual Budget Release

     

5:00

JPY

 

BOJ Monthly Report

     

12:30

USD

 

Core Durable Goods Orders m/m

   

-0.8%

12:30

USD

 

Unemployment Claims

     

12:30

USD

 

Durable Goods Orders m/m

   

-4.0%

23:30

JPY

 

Tokyo Core CPI y/y

   

-0.5%

May 25

TBD

ALL

 

G8 Meetings

     

13:55

USD

 

Revised UoM Consumer Sentiment

     

AUD/USD Forecast May 22, 2012, Technical Analysis

The AUD/USD pair shot straight up for the session on Monday as the bounce that many had waited for. The pair seems to be finding a lot of support 0.98 levels, and as a result we think this pair could continue higher. A break of the highs on the Monday session has the market looking for the parity and then 1.02 levels. However, we don’t like taking on risk in these kinds of environments, and we prefer to sell this pair at higher levels. Because of this, we think that a weak candle could be a sell signal near parity and 1.02 or so. On one of those candles, we are sellers.

AUD/USD Forecast May 22, 2012, Technical Analysis
AUD/USD Forecast May 22, 2012, Technical Analysis

In The Eyes of the Experts – 21/5/2012

What is this report?

In the morning the experts meet in the dealing room in order to prepare themselves for another trading day. They read the business press, and note relevant economic announcements expected during the day. They also consider the support and resistance lines and discuss the important rates in the major pairs; they indicate which pairs may strengthen and those which could weaken. Afterwards they wish everyone a successfully day of trading and turn on the computer screens…

Below you can find pairs the experts assume may be strengthen and weaken during the trading day; support and resistance lines relevant to the day’s trading and critical time for trading each day (important news etc.).

Currencies to watch for Long:

  • AUD
  • NZD
  • CAD

 

Currencies watch for Short:

  • JPY

 

Today’s important times (GMT+2):

  • None

 

Important rates:

Pair R2 R1 Pivot S1 S2
EURUSD 1.2590    1.2682 1.2933 1.2826 1.2877
GBPUSD 1.5693 1.5760    1.5798 1.5866 1.5904
USDJPY    78.71 78.89 79.17 79.34 79.62
USDCHF 0.9323 0.9361 0.9430    0.9467 0.9536
USDCAD 1.0102 1.0155 1.0190 1.0243    1.0279
AUDUSD 0.9734 0.9774 0.9833 0.9873 0.9932   

AUD/USD Fundamental Analysis May 22, 2012 Forecast

Analysis and Recommendation: (close of Asian session)

The AUD/USD picked up some strength in the early part of the day but then began to fall again, closing midway between open and close against the strong USD. The pair ended today’s session at 0.9852.

The Australian dollar is bouncing back from six-month lows reached at the end of last week as the market mood improves.

At noon on Monday, the Aussie was trading at 0.9875 US cents, up from .09825 cents on Friday.

That rounded off a week of falls for the Australian dollar after negotiations to form a new coalition government in Greece broke down, sparking a new round of elections for the country crippled by high levels of government debt.

Support from China in assurances that the government would do everything possible to jump start the Chinese economy, strengths Asian markets.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports. Economic Data for May 21, 2012 actual v. forecast

Date

 

 

Currency

 

 

 

Event

Actual

 

Forecast

 

Previous

 

 

May 21

 

 

GBP

 

 

 

Rightmove House Price Index (MoM) 

0.0%

 

 

 

2.9% 

 

 

 

 

 

THB

 

 

 

Thai GDP (YoY) 

0.3%

 

-0.5% 

 

-8.9% 

   

 

 

 

NZD

 

 

 

Credit Card Spending (YoY) 

3.7%

 

 

 

5.3% 

   

 

 

 

JPY

 

 

 

All Industries Activity Index (MoM) 

-0.3%

 

0.0% 

 

-0.1%

   

 

 

Upcoming Economic Events that affect the AUD, NZD, JPY and USD

 

May 22

3:00

NZD

 

Inflation Expectations q/q

   

2.5%

14:00

USD

 

Existing Home Sales

   

4.48M

23:50

JPY

 

Trade Balance

   

-0.62T

May 23

0:00

AUD

 

CB Leading Index m/m

   

0.0%

0:30

AUD

 

MI Leading Index m/m

   

0.2%

TBD

JPY

 

Monetary Policy Statement

     

TBD

JPY

 

Overnight Call Rate

   

<0.10%

TBD

JPY

 

BOJ Press Conference

     

14:00

USD

 

New Home Sales

   

328K

14:30

USD

 

Crude Oil Inventories

     

 

AUD/USD Forecast May 21, 2012, Technical Analysis

The AUD/USD pair fell on Friday as the “risk off” attitude continues to haunt the markets. The Aussie is suffering at the hands of the fear of European debt issues and as the risk assets around the world fall in value, there is less interest in owning the currency. The Australians export quite a large amount of raw materials to the Chinese, and it now appears that the Chinese economy is about to start slowing again. With this being the case, there will be fewer orders for copper from Beijing to Canberra. Because of this, there will be less demand for the Aussie in general. 

The trading world loves the idea of the Aussie being a proxy for risk. If the global economy is doing well, there is a good chance that the Aussie dollar is going to appreciate. The opposite is true as well. When the economy is doing poorly, there is a tendency of larger firms to convert everything back into US dollars so they can either buy blue chip stocks at the NYSE and NASDAQ, or buy US Treasuries. This is the classic “safety trade”.

The candle does however look a bit like a hammer from Friday, so there is the possibility of a bounce from here. However, the trend is certainly down now. The 1.02 level above is a massive resistive level waiting to happen. The area was significant for support, and now it should turn into massive resistance. The series of candles all the way up to 1.02 features several red candles for sellers to show resistance, so it is also possible that we don’t even make back up to the 1.02 level.

The global issues should continue to hurt the Aussie overall, and even if we get more easing by central banks around the world, there is obviously a lack of excitement for it. Each round of easing by central banks offers less and less effect, so if this does come to bear, there is a real chance that this pair doesn’t rally much on that news. Because of this, we are thinking sell only. Either after rallies on signs of weakness, of a break of the lows from Friday. 

AUD/USD Forecast May 21, 2012, Technical Analysis
AUD/USD Forecast May 21, 2012, Technical Analysis

AUD/USD Forecast for the Week of May 21, 2012, Technical Analysis

The AUD/USD pair fell hard for most of the week as the “risk off” trade is now back in full force. The pair is now well under the parity level, and now looks as if it is pressing to break down to the 0.95 level. However, the fall has been strong enough that a bounce could be coming. Because of this, we are selling rallies instead of chasing this trade all the way down here. The 1.02 level should continue to be resistive going forward, and it isn’t until we close well above that level in order to place long-term buy positions in this pair. 

AUD/USD Forecast for the Week of May 21, 2012, Technical Analysis
AUD/USD Forecast for the Week of May 21, 2012, Technical Analysis

AUD/USD Weekly Fundamental Analysis May 21-25, 2012, Forecast

Introduction:  The Australian dollar still isn’t in its good old days, but the performance is definitely improving. Resistance lines tend to work in a smoother manner than support lines, but they also work well. The pair move well together, not much volatility, but easy to chart and easy to trade with low risk factors

Weekly Analysis and Recommendation:

The AUD/USD closed the week down at 0.9844 as the AUD lost over 1% of its value. Risk Aversion was the mood all week, with no signs of letting up. There was little in the way of supportive eco data although Australia did see a rise in consumer sentiment as well as a high wage price index. The extended worries from China, was a negative for the currency but overall it was the eurozone weighing down the markets. The USD and JPY continued to be the benefactors of risk moves. Although towards the end of the week there was a small shift to more risky assets which benefitted the commodity currencies.

Highest: 1.0034

Lowest: 0.9796

Difference: 0.0238

Average: 0.9917

Change %: -1.28

Major Economic Events for the week of May 14-18 actual v. forecast for Yen, the Aussie and the Kiwi

 NZD

 

Retail Sales (QoQ)

-1.5%

-0.5%

1.8%

 

 NZD

 

Core Retail Sales (QoQ)

-2.5%

0.3%

2.3%

 

 AUD

 

Home Loans (MoM)

0.3%

-2.0%

-2.5%

 

 JPY

 

Tertiary Industry Activity Index (MoM)

-0.6%

-0.3%

0.0%

 

 AUD

 

Westpac Consumer Sentiment

 0.80%

 

-1.60%

 

 AUD

 

Wage Price Index (QoQ)

0.9%

0.8%

1.0%

 

 NZD

 

PPI Input (QoQ)

0.3%

0.0%

0.5%

 

 JPY

 

GDP (QoQ) 

1.0%

0.9%

-0.2%

 

 JPY

 

GDP Price Index (YoY) 

-1.2%

-1.4%

-1.8%

 

 JPY

 

Industrial Production (MoM)

1.3%

1.1%

1.0%

 

 

Economic Highlights of the coming week that affect the AUD,JPY,NZD and USD

May 22

3:00

NZD

 

Inflation Expectations q/q

   

2.5%

14:00

USD

 

Existing Home Sales

   

4.48M

23:50

JPY

 

Trade Balance

   

-0.62T

May 23

0:00

AUD

 

CB Leading Index m/m

   

0.0%

0:30

AUD

 

MI Leading Index m/m

   

0.2%

TBD

JPY

 

Monetary Policy Statement

     

TBD

JPY

 

Overnight Call Rate

   

<0.10%

TBD

JPY

 

BOJ Press Conference

     

14:00

USD

 

New Home Sales

   

328K

14:30

USD

 

Crude Oil Inventories

     

22:45

NZD

 

Trade Balance

   

134M

May 24

2:00

NZD

 

Annual Budget Release

     

5:00

JPY

 

BOJ Monthly Report

     

12:30

USD

 

Core Durable Goods Orders m/m

   

-0.8%

12:30

USD

 

Unemployment Claims

     

12:30

USD

 

Durable Goods Orders m/m

   

-4.0%

23:30

JPY

 

Tokyo Core CPI y/y

   

-0.5%

May 25

TBD

ALL

 

G8 Meetings

     

13:55

USD

 

Revised UoM Consumer Sentiment

     

Upcoming Government Bond Auctions

Date Time Country 

May 21 09:10 Norway 

May 21 09:30 Germany 

May 21 10:00 Belgium 

May 22 08:30 Holland 

May 22 08:30 Spain 

May 22 17:00 US 

May 23 09:10 Sweden 

May 23 09:30 Germany 

May 23 14:30 Sweden 

May 23 17:00 US

May 24 15:30 Italy

May 24 17:00 US

May 25 15:30 Italy  

USD/CAD Weekly Fundamental Analysis May 21-25, 2012, Forecast

Introduction: The Canadian Dollar moves in reaction to the US Dollar. Movements are small and easy to track and trade. The Canadian Dollar also responds to economic reports within Canada. It has little action against foreign currencies except during major moves or crisis.

The USD/CAD is the single biggest beneficiary of rising oil prices. Canada which is already the biggest exporter of oil to the US will experience a boost to its economy when oil price continue to increase. Therefore, if oil rises the Canadian dollar is likely to follow. Over the past years, the correlation between the Canadian dollar and oil prices has been approximately 81%. 

Weekly Analysis and Recommendation:

The USD/CAD ended the week close to the high at 1.0221. The Canadian dollar could not mount any defenses against the strength of the USD this week. Oil prices plummeted to a near record low for the year, weakening the Canadian economy, which is dependent upon exports of crude to the US. As shown in the chart below, the CAD lost 0.0236 or 1.97 of its value this week.

Highest: 1.0227

Lowest: 0.9991

Difference: 0.0236

Average: 1.0125

Change %: 1.97

Since its strongest point on April 27th, CAD has lost 4.0%. The combination of rising risk aversion and uneven data from the US is weighing heavily on the currency. This week was thin on eco data, there is no US data of note, Canadian 2 year bond yields have dropped 12bpts since the end of April, while US 2‐years have gained 4bpts.However, the expectations for BoC interest rate increases have not moved to the same degree. Currently, the OIS market is pricing in a 42% probability of an interest rate hike in Canada over the next 9months. Major Economic Events for the week of May 14-18 actual v. forecast for the Canadian & US Dollar

 USD

 

Core CPI (YoY)

2.3%

2.3%

2.3%

 

 USD

 

Core CPI (MoM)

0.2%

0.2%

0.2%

 

 USD

 

CPI (YoY)

2.3%

2.3%

2.7%

 

 USD

 

NY Empire State Manufacturing Index

17.1

8.5

6.6

 

 USD

 

Core Retail Sales (MoM)

0.1%

0.2%

0.8%

 

 USD

 

CPI (MoM)

0.0%

0.1%

0.3%

 

 USD

 

Retail Sales (MoM)

0.1%

0.2%

0.7%

 

 USD

 

TIC Net Long-Term Transactions

36.2B

19.4B

10.1B

 

 USD

 

Housing Starts

0.717M

0.680M

0.699M

 

 CAD

 

Manufacturing Sales (MoM)

1.90%

1.00%

-0.20%

 

 USD

 

Building Permits

0.715M

0.730M

0.769M

 

 USD

 

Industrial Production (MoM)

1.1%

0.6%

-0.6%

 

 USD

 

Continuing Jobless Claims

3265K

3235K

3247K

 

 CAD

 

Wholesale Sales (MoM)

0.4%

0.4%

1.5%

 

 CAD

 

Foreign Securities Purchases

-2.08B

9.34B

12.54B

 

 USD

 

Initial Jobless Claims

370K

365K

370K

 

 USD

 

Philadelphia Fed Manufacturing Index

-5.8

10.0

8.5

 

 CAD

 

CPI (YoY)

2.0%

2.0%

1.9%

 

 CAD

 

CPI (MoM)

0.4%

0.3%

0.4%

 

 CAD

 

Core CPI (MoM)

0.4%

0.3%

0.3%

 

Historical:

Highest: 1.0842 CAD on 01 Nov 2009.

Average: 1.0147 CAD over this period.

Lowest: 0.9435 CAD on 26 Jul 2011.

 

Economic Highlights of the coming week that affect the American and Canadian Markets.

May 22

14:00

USD

 

Existing Home Sales

   

4.48M

May 23

12:30

CAD

 

Core Retail Sales m/m

   

0.5%

12:30

CAD

 

Retail Sales m/m

   

-0.2%

14:00

USD

 

New Home Sales

   

328K

14:30

USD

 

Crude Oil Inventories

     

May 24

12:30

USD

 

Core Durable Goods Orders m/m

   

-0.8%

12:30

USD

 

Unemployment Claims

     

12:30

USD

 

Durable Goods Orders m/m

   

-4.0%

May 25

TBD

ALL

 

G8 Meetings

     

13:55

USD

 

Revised UoM Consumer Sentiment

     

AUD/USD Fundamental Analysis May 21, 2012 Forecast

Analysis and Recommendation: (close of Asian session)

The AUD/USD continues to tumble as risk aversion is the main theme of the markets. Investors had looked for a bit more risk and tried moving to the commodity currencies, but the problems with Greece and throughout the eurozone continues to escalate, investors moved back to the safety of the USD and the yen. The pair fell to 0.9808

Today the eco calendar is thin both in Asian, Europe and the America’s so market movement will be on news, rumor and press from the eurozone.

We can expect that Hollande, Merkel, the ECB and Spain and Greece to be the top news stories and market movers today. The other main focus will be the rollout of the Facebook IPO which will keep market attentions.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports.

Economic Data May 17, 2012 actual v. forecast

 

 

CAD

 

 

 

Foreign Securities Purchases 

-2.08B

 

9.34B 

 

12.54B 

   

 

 

USD

 

 

 

Initial Jobless Claims 

370K

 

365K 

 

370K 

   

 

 

CAD

 

 

 

Wholesale Sales (MoM) 

0.4%

 

0.4% 

 

1.5% 

   

 

 

USD

 

 

 

Continuing Jobless Claims 

3265K

 

3235K 

 

3247K 

   

 

 

MXN

 

 

 

Mexican GDP (YoY) 

4.60%

 

4.50% 

 

3.90% 

   

 

 

USD

 

 

 

Philadelphia Fed Manufacturing Index 

-5.8

 

10.0 

 

8.5 

 

 

Upcoming Economic Events that affect the AUD, NZD, JPY and USD

May 22

3:00

NZD

 

Inflation Expectations q/q

   

2.5%

14:00

USD

 

Existing Home Sales

   

4.48M

23:50

JPY

 

Trade Balance

   

-0.62T

May 23

0:00

AUD

 

CB Leading Index m/m

   

0.0%

0:30

AUD

 

MI Leading Index m/m

   

0.2%

TBD

JPY

 

Monetary Policy Statement

     

TBD

JPY

 

Overnight Call Rate

   

<0.10%

TBD

JPY

 

BOJ Press Conference

     

14:00

USD

 

New Home Sales

   

328K

14:30

USD

 

Crude Oil Inventories

     

22:45

NZD

 

Trade Balance

   

134M

May 24

2:00

NZD

 

Annual Budget Release

     

5:00

JPY

 

BOJ Monthly Report

     

12:30

USD

 

Core Durable Goods Orders m/m

   

-0.8%

12:30

USD

 

Unemployment Claims

     

12:30

USD

 

Durable Goods Orders m/m

   

-4.0%

23:30

JPY

 

Tokyo Core CPI y/y

   

-0.5%

May 25

TBD

ALL

 

G8 Meetings

     

13:55

USD

 

Revised UoM Consumer Sentiment