Both the U.S. and Australia are printing economic reports in the next trading sessions so you can bet that I’m looking at AUD/USD today!
Will AUD/USD continue to make new intraweek lows?
Before moving on, ICYMI, yesterday’s watchlist looked at USD/JPY’s intraday bearish momentum for an opportunity to jump on the pair’s uptrend. Be sure to check out if it’s still a valid play!
And now for the headlines that rocked the markets in the last trading sessions:
Fresh Market Headlines & Economic Data:
BOJ’s core CPI inched higher from 2.7% to 2.9% y/y in March
Japan’s business services inflation up by 1.8% in FY 2022 (from 1.2% in 2021), the fastest increase since FY 2014
BOJ Gov. Ueda maintained that “it’s appropriate to maintain monetary easing” for now but also said that BOJ stands ready to raise interest rates “if wage growth and inflation accelerates faster than expected”
Switzerland’s trade surplus widened from 3.31B CHF to 4.53B CHF in March as exports grew by 19.9% m/m while imports rose by 15.9% m/m
U.K.’s public sector net borrowing came in at 21.5B in March – the second-largest March borrowing on record – as the government continues its energy support schemes
Price Action News
Overlay of AUD Pairs 15-min
Asian session traders tried to extend upticks seen in the U.S. session but, with not a lot of top-tier data on tap, markets had time to price in their growth concerns.
AUD, in particular, took extra hits as talks of China’s banks being pressured to lower their deposit rates hit the markets.
It also didn’t help that Australia’s CPI scheduled in the next Asian session trading is expected to print lower acceleration in Q1 which will support RBA’s plans to pause its rate hikes.
AUD broke below its U.S. session lows and made new intraweek lows with minimal pullback at the start of London session trading.
Upcoming Potential Catalysts on the Economic Calendar:
U.K.’s CBI industrial order expectations at 10:00 am GMT
U.S. house price index at 1:00 pm GMT
U.S. CB consumer confidence at 2:00 pm GMT
U.S. new home sales at 2:00 pm GMT
U.S. Richmond manufacturing index at 2:00 pm GMT
New Zealand’s trade balance at 10:45 pm GMT
AU quarterly CPI at 1:30 am GMT (Apr 26)
NZ credit card spending at 3:00 am GMT (Apr 26)
Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️
AUD/USD 15-min Forex Chart by TradingView
AUD/USD, which made new intraweek lows a few hours earlier, looks set for a bit of a bounce after seeing buyers at the Standard Pivot Points‘ S2 levels (.6650).
The U.S. CB consumer confidence, new home sales, and Richmond manufacturing index reports as well as Australia’s awaited CPI report should make things interesting for AUD/USD’s intraweek price action.
As we saw last week, disappointing U.S. reports brought on risk aversion that hurt AUD more than USD. Add to that expectations of consumer price deceleration in Australia and it’s more likely that we’ll see AUD/USD selling.
I’m looking at the area between today’s Pivot Point and the S1 (.6670) line. As you can see, it served as a support zone on Friday and on Monday.
A rejection and then bearish momentum at the level could make for a good entry point in case AUD/USD starts a sustained intraweek downtrend.
But if the U.S. and Australia’s reports turn out positive for risk-taking, then I can also consider buying at current levels and aiming for today’s highs.
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