Forex Flash: Solid resistance stymies AUD/USD upside – Westpac

By
A A A
Share |

FXstreet.com (Barcelona) - Australia's domestic calendar returns to life this week, with another very large trade deficit expected in November, however the RBA likely to be more interested in the retail sales data.

According to Strategist Sean Callow at Westpac, "Pricing for a cut at the RBA's Feb meeting is understandably slipping back to -10bp, with further easing seen as likely at some point but no pressing case for it to be as soon as February." The surge in equities following the US Congress's deal on most of the 'fiscal cliff' helped the AUD/USD test above 1.05 again but the high 1.05s remain formidable resistance.

Moreover, "Solid support should emerge on any re-test of the mid-1.03s, given that the Fed will maintain QE at least until mid-year, while China's growth momentum is intact and iron ore prices will boost Australian export revenue even if they seem to be overshooting thanks to Indian supply constraints." he notes. Indeed, the spot iron ore price has surged 33% since end-November, despite record volumes of exports from Port Hedland, WA. This will be very helpful for the December trade report.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Forex and Currencies

Referenced Stocks:

FXstreet.com

FXstreet.com

More from FXstreet.com:

Related Videos

Stocks

Referenced

Most Active by Volume

132,019,746
  • $16.39 ▲ 2.44%
106,930,017
  • $59.09 ▲ 0.34%
91,643,760
  • $3.09 ▼ 1.12%
79,029,415
  • $85.02 ▲ 0.29%
46,131,885
  • $40.18 ▲ 3.74%
42,395,508
  • $7.06 ▼ 0.56%
40,101,748
  • $26.76 ▲ 0.75%
39,547,363
  • $13.33 ▼ 3.96%
As of 4/15/2014, 04:02 PM