The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG Bank S.A. accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication.
AUD/USD has managed to keep to the 0.9300 handle and largely held off the strength we’ve been seeing in the greenback.
There is significant support in the 0.9300 region, given it’s the 23.6% retracement of the rally from January lows to July highs. Additionally, there is an uptrend support line which extends from the January lows and all the way through August lows. While this support level looks like it will hold in the near term, traders could be looking to sell the pair on strength as the fundamentals on the AUD side are bearish and bullish on the USD side.
The key events for the AUD this week will be quarterly construction work on Wednesday and private capital expenditure on Thursday. These readings feed into GDP, and any further signs of weakness could see fresh AUD selling. Out of China we have industrial profits data on Thursday and, judging by the recent run in data, we could be in for further disappointment. If that’s the case, further selling could be on the cards for the AUD.