Morning View: USD Still in Charge

March 30, 2015

Morning Recap:
Good morning!

With a couple of exciting changes at Vantage FX, I’m now going to be writing a Morning View here as well as getting more involved in the online financial community. I start on a week shortened by Good Friday, but we still have plenty to talk about and I look forward to chatting with a few of you about what we have in front of us. Feel free to leave a comment at the bottom of this post or say hello on Twitter by mentioning @VantageFX.

Well then. Do we remember last week when the market was concerned about Yellen’s dovish tone and it was time to start watching for a change of trend in the USD pairs? Yeah, me either… Markets have opened Monday by shrugging off any hawkish comments from the Fed Chair, and we can see USD pairs relatively weaker across the board from last week’s close.

Janet Yellen had recently suggested that the US tightening cycle could be more measured than the market was expecting to hear, but any move in interest rates from the Fed has always been a question of ‘when’ and ‘by how much?’ Something the market has to remind itself from time to time, so it seems.

The Week Ahead:
We start the week on a slow note with nothing on the economic calender Monday, but when everyone is meant to be winding down on public holiday Friday we have the most important data point of the week. Go figure!

Monday:

Tuesday:

Wednesday:
USD CB Consumer Confidence
AUD Building Approvals m/m
USD ADP Non-Farm Employment Change

Thursday:
USD ISM Manufacturing PMI
AUD Trade Balance
USD Trade Balance
USD Unemployment Claims

Friday:
USD Non-Farm Employment Change
USD Unemployment Rate

Australia will be watching Building Approvals tomorrow and February’s Trade Balance data Wednesday before we hit the big stuff on Thursday and Friday with US Unemployment and Non-Farm Payrolls.

The market expects the RBA to be cutting rates again as soon as next month and really these data points shouldn’t have too much of an impact on Stevens’ thinking. Keep this in mind if you are trading around any of these Australian data releases, as you might be able to get a chance to fade an over-reaction from the number printed.

Chart of the Day:
In this section of my Morning View, I will be posting the day’s most topical charts and sharing my technical views. We start with the AUD/USD Daily re-testing previous trend line resistance now as support.

AUD/USD Daily:
aumon
Click on chart to see a larger view.
As seems to be the pattern lately, we started last week with some AUD buying off the bat. It’s always dangerous to call a market in a strong downtrend such as AUD/USD ‘too low’, but this 75.000 – 80.000 zone is giving me an itch.

As you can see on the Daily chart above, price has broken out of it’s daily downward sloping channel on talk that Yellen’s previous Friday afternoon comments weren’t as hawkish as expected, but USD strength kicked straight back in and we sold off all the way into the weekend. Price now sits on the other side of the trend line, re-testing previous resistance now as support.

I will be looking for buyers to enter the market down here with any sort of strength off that re-test of the broken trend line. 77.000 and just above is my key level to watch for a reaction from buyers. Alternatively, as we are still in a strong down trend, watch for price tucking back into the channel with any touch from the underside possibly re-activating the level to resume another leg to the downside.

Once again, please say hello either with a comment below or a mention on Twitter, and let me know what you’re watching or trading this week.

Dane Williams – @VantageFX

Risk Disclosure: In addition to the website disclaimer below, the material on this page prepared by MT4 broker Vantage FX Pty Ltd, does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. The research contained in this report should not be construed as a solicitation to trade. All opinions, news, research, analyses, prices or other information is provided as general market commentary and marketing communication – not as investment advice. Consequently any person acting on it does so entirely at their own risk. The experts writers express their personal opinions and will not assume any responsibility whatsoever for the actions of the reader. We always aim for maximum accuracy and timeliness and Vantage FX shall not be liable for any loss or damage, consequential or otherwise, which may arise from the use or reliance on the service and its content, inaccurate information or typos. No representation is being made that any results discussed within the report will be achieved, and past performance is not indicative of future performance.

Social

Free Daily Market Update

Live Spreads

SymbolBidAskSpread

Spread

Sign up to the latest forex news and daily FX trading setups

Get started with a FREE $50,000 demo account