26 May 2015
AUD/USD: Pict remains bleak, 0.79 handle near by
FXStreet (Bali) - AUD/USD has come under pressure at the Tokyo open, with the rate descending from a session high of 0.7832 down to 0.7816, after a NY close of 0.7824.
The 2-day rally in iron ore prices (TSI Iron Ore 62% China Import CFR Daily) has failed to provide any support to the Aussie, which remains trading dangerously near the 0.78 handle, a lower price acceptance environment that suggests the bear run may not be over. The next data points to inflict volatility to the pair will come in the US session, when a large batch of US data, including US durable good orders, consumer confidence and home sales, will be released. Earlier in Europe, order flow will also pick up considerably, following a long weekend for most traders.
The market continues to expect a rate hike by the Fed later this year, but as ANZ underscores in a note to clients this morning, the market needs something additional in the US data front to elicit a more sustained bullish movement in the USD. That said, the explicit re-introduction of an easing bia (subject to data) by the RBA is a significant bearish input for the AUD going forward, which should limit relief rallies.
The 2-day rally in iron ore prices (TSI Iron Ore 62% China Import CFR Daily) has failed to provide any support to the Aussie, which remains trading dangerously near the 0.78 handle, a lower price acceptance environment that suggests the bear run may not be over. The next data points to inflict volatility to the pair will come in the US session, when a large batch of US data, including US durable good orders, consumer confidence and home sales, will be released. Earlier in Europe, order flow will also pick up considerably, following a long weekend for most traders.
The market continues to expect a rate hike by the Fed later this year, but as ANZ underscores in a note to clients this morning, the market needs something additional in the US data front to elicit a more sustained bullish movement in the USD. That said, the explicit re-introduction of an easing bia (subject to data) by the RBA is a significant bearish input for the AUD going forward, which should limit relief rallies.