Introduction: The Australian dollar still isnt 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 continued to climb this week hitting a high of 1.0412 and closing the week at 1.0332. The Chinese data will give a better understanding of the current Chinese economy, the PMI number will have to be above 49 to generate risk-on trading activity. The bigger risk is if it comes in lower as it will (call) into question the veracity of the data previously released. Last week the Chinese data dump showed that GDP fell to 7.4% as expected but retail sales and manufacturing reported above expectations.
The Australian inflation rate for the third quarter of 2012, scheduled for release on October 23rd, is set to remain below the Reserve Bank of Australias (RBA) medium-term target range of 2-3%. Economists estimate that consumer prices increased by 1.7% y/y in the July-September period, up from 1.2% in the prior quarter. The uptick is largely explained by the introduction of a carbon tax in mid-2012. Expect consumer price inflation to close the year at 2.7% y/y. In response to a softer economic growth outlook and manageable inflation prospects, the RBA cut the benchmark interest rate by 25 basis points to 3.25% in early October
Date
|
Last
|
Open
|
High
|
Low
|
Change %
|
Oct 19, 2012
|
1.0332
|
1.0374
|
1.0378
|
1.0318
|
-0.40%
|
Oct 18, 2012
|
1.0374
|
1.0377
|
1.0412
|
1.0356
|
-0.03%
|
Oct 17, 2012
|
1.0377
|
1.0307
|
1.0388
|
1.0299
|
0.68%
|
Oct 16, 2012
|
1.0307
|
1.0265
|
1.0314
|
1.0246
|
0.41%
|
Oct 15, 2012
|
1.0265
|
1.0223
|
1.0268
|
1.0203
|
0.41%
|
This week is a two-day meeting of the Federal Open Market Committee, which concludes Wednesday. Nomura analysts said considering that QE3 was announced in the September meeting, they now expect the FOMC to enter a holding pattern while watching for signs of a substantial improvement in the labor market. With the FOMC in wait-and-see mode, the ongoing discussion among participants around crafting a consensus forecast is likely to intensify, while other discussion may focus on what to do when Operation Twist ends in December.
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 recent analysis and information in our weekly reports and we provide dailyupdates and outlooks.
Major Economic Events for the week of October 15-19, 2012 actual v. forecast for Yen, the Aussie, the Kiwi and USD
Date
|
Currency
|
Event
|
Actual
|
Forecast
|
Previous
|
Oct. 15
|
AUD
|
Home Loans (MoM)
|
1.8%
|
1.4%
|
-0.7%
|
CNY
|
Chinese CPI (YoY)
|
1.9%
|
1.9%
|
2.0%
| |
CNY
|
Chinese PPI (YoY)
|
-3.6%
|
-3.6%
|
-3.5%
| |
CNY
|
Chinese CPI (MoM)
|
0.3%
|
0.4%
|
0.6%
| |
JPY
|
Industrial Production (MoM)
|
-1.6%
|
-1.3%
|
-1.3%
| |
USD
|
Core Retail Sales (MoM)
|
1.1%
|
0.6%
|
1.0%
| |
USD
|
Retail Sales (MoM)
|
1.1%
|
0.8%
|
1.2%
| |
USD
|
NY Empire State Manufacturing Index
|
-6.2
|
-4.5
|
-10.4
| |
NZD
|
CPI (QoQ)
|
0.3%
|
0.6%
|
0.3%
| |
Oct. 16
|
USD
|
Core CPI (MoM)
|
0.1%
|
0.2%
|
0.1%
|
USD
|
CPI (MoM)
|
0.6%
|
0.5%
|
0.6%
| |
USD
|
CPI (YoY)
|
2.0%
|
1.9%
|
1.7%
| |
USD
|
Core CPI (YoY)
|
2.0%
|
2.0%
|
1.9%
| |
USD
|
TIC Net Long-Term Transactions
|
90.0B
|
45.3B
|
67.2B
| |
USD
|
Industrial Production (MoM)
|
0.4%
|
0.2%
|
-1.4%
| |
Oct. 17
|
USD
|
Building Permits
|
0.894M
|
0.810M
|
0.801M
|
USD
|
Housing Starts
|
0.872M
|
0.770M
|
0.758M
| |
Oct. 18
|
AUD
|
NAB Quarterly Business Confidence
|
-2.00
|
-2.00
| |
CNY
|
Chinese Fixed Asset Investment (YoY)
|
20.5%
|
20.2%
|
20.2%
| |
CNY
|
Chinese GDP (YoY)
|
7.4%
|
7.4%
|
7.6%
| |
CNY
|
Chinese Industrial Production (YoY)
|
9.2%
|
9.0%
|
8.9%
| |
CNY
|
Chinese Retail Sales (YoY)
|
14.2%
|
13.2%
|
13.2%
| |
USD
|
Initial Jobless Claims
|
388K
|
365K
|
342K
| |
USD
|
Continuing Jobless Claims
|
3252K
|
3275K
|
3281K
| |
USD
|
Philadelphia Fed Manufacturing Index
|
5.7
|
1.0
|
-1.9
| |
Oct. 19
|
USD
|
Existing Home Sales
|
4.75M
|
4.75M
|
4.82M
|
Historical: From 2010 to present
Highest:1.1080 USD on Jul 27, 2011
Average:0.9898 USD over this period
Lowest:0.8067 USD May 25, 2010
Economic Highlights of the coming week that affect the AUD, JPY, NZD and USD
Date
|
Time
|
Currency
|
Event
|
Forecast
|
Previous
|
Oct. 24
|
01:30
|
AUD
|
1.1%
|
0.5%
| |
01:30
|
AUD
|
0.6%
|
0.5%
| ||
02:45
|
CNY
|
47.90
| |||
15:00
|
USD
|
385K
|
373K
| ||
21:00
|
NZD
|
2.50%
|
2.50%
| ||
Oct. 25
|
22:45
|
NZD
|
-825M
|
-789M
| |
Oct. 26
|
00:30
|
JPY
|
-0.5%
|
-0.4%
|
Government Bond Auction
Date Time Country
Oct 22 09:10 Norway
Oct 23 08:30 Spain
Oct 23 14:30 UK
Oct 23 17:00 US
Oct 24 09:10 Sweden
Oct 24 09:30 Germany
Oct 24 14:30 Sweden
Oct 24 15:30 Italy
Oct 24 16:30 US
Oct 25 00:30 Japan
Oct 25 09:10 Sweden
Oct 25 15:30 Italy
Oct 25 17:00 US
Oct 26 09:10 Italy
Click here to read AUD/USD Technical Analysis.
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