AUD/USD

The Australian Westpac Consumer Confidence for March significantly bear the prior reading of -2.6% with a positive reading of +0.2%, helping the AUD move higher against the USD and JPY, continuing its push after the earlier comments from the RBA’s Lowe. The Consumer Confidence Index was also better than the prior month at 117.3 vs. 117. The AUD/USD pair  is continuing higher and approaching some resistance below the 92 cent handle.

Although the AUDUSD dipped below the 100 day MA at the 0.9067 level (see chart below), it ran into support against the 100 hour MA just below at the 0.9056 level. The combo has given the pair a lift as technical traders used the low risk trading level to buy against (with likely stops on a break).

A break should lead to higher levels.

The AUDUSD is moving up toward the 100 day MA as oil and commodities increase and stocks increase.  Copper futures are up 5.90. Gold is up 19.63. Oip is up 1.88. 

The RBA raised rates yesterday to 4% and are moving closer to the the 4.5% rate which is neutral rate the bank is moving toward.  The AUDUSD initially but turned around and has rallied for most of the NY session.  Look for sellers against the 100 day MA as profit takers enter.  A break, however, should see increased upside momentum. 

Watching the triple top in the AUDUSD at the 0.9007 level.  A break above should lead to a surge higher with 0.9030 area the next target. The high from last week at 0.9070 becomes another target within site.

On the downside, the price bounced off the 50% of the consolidative range at the 0.8935 level earlier. This is positive and the price is above the 200 hour MA at the 0.8951 level (green line) which is also a positive development today. 

The AUDUSD broke through the 200 hour MA (at 0.8946) and has support at the 0.8882 level where the level has had around 7 or so lows/highs in the region over the last few weeks of trading (see chart above). The level is also the 38.2% retracement of the move up from the low on February 5th to the high today.   The level has slowed the decline but will it attract enough buying support against the level to scare the shorts? 

After an uneventful opening day to the trading week, most majors have remained in a tight range as indecision in the markets has currencies, equities and bonds trading relatively unchanged. For the AUD/USD chart we examined yesterday, we see the former trendline support held as resistance and the pair is now finding support at the 100 hr moving average.

Risks pairs are firmer to start the trading week amid continued speculation of a debt bailout for Greece, even as negative articles on the state of the Euro and inflationary concerns in Europe persist. The initial move higher on the EUR/USD has not followed through with the open of trading in Tokyo, which could mean this bid is to be short lived. The EUR/USD pair has broken the downward channel which has contained the pair since the beginning of the year, but any further appreciation could be met with some resistance at the 100hr moving average.

The AUDUSD has fallen on the back of the Fed Discount rate increase and stands between the Goal Posts as defined by the 100 hour MA and the 200 hour MA.   The 200 hour MA comes in at the 0.8872 now and should be initial profit taking support. The low has reached 0.8887 so far .  The 100 hour MA was broken at the 0 .8952 level and this should now keep the rallies contained.