The Australian service sector extended its slowdown and is moving closer to the 50.0 level. Third-quarter GDP data showed disappointing consumption data and capital expenditures contracted. Chinese data surprised once again to the upside, but Hong Kong showed a weaker figure than expected. The AUDUSD reversed into support, but how will price action be impacted by US data later in the trading session? Today’s fundamental analysis will take a look at price action in both directions.
Forex traders are eagerly awaiting the release of the US ISM Non-Manufacturing Index. The ISM Manufacturing Index disappointed on Monday and the AUDUSD has advanced as a result of US Dollar weakness. Today’s ADP report will give traders a first look at what to expect from Friday’s NFP report. How will this currency pair react following the release of economic data out of the US? Subscribe to the PaxForex Daily Fundamental Analysis and earn over 5,000 pips per month.
Here are the key factors to keep in mind today for Australian Dollar trades:
- Australian AiG Performance of Services Index: The Australian AiG Performance of Services Index for November was reported at 53.7. Forex traders can compare this to the Australian AiG Performance of Services Index for October which was reported at 54.2.
- Australian CBA Services PMI and CBA Composite PMI: The Final Australian CBA Services PMI for November was reported at 49.7. Forex traders can compare this to the previous Australian CBA Services PMI for November which was reported at 49.5. The Final Australian CBA Composite PMI for November was reported at 49.7. Forex traders can compare this to the previous Australian CBA Composite PMI for November which was reported at 49.5.
- Australian GDP: The Australian GDP for the third-quarter increased by 0.4% quarterly and by 1.4% annualized. Economists predicted an increase of 0.5% quarterly and 1.7% annualized. Forex traders can compare this to the Australian GDP for the second-quarter which increased by 0.5% quarterly and by 1.4% annualized. Capital Expenditure for the third quarter decreased by 0.2% quarterly, the Chain Price Index increased by 0.7% quarterly and Final Consumption increased by 0.3% quarterly. Forex traders can compare this to Capital Expenditure for the second-quarter which decreased by 1.7% quarterly, to the Chain Price Index which increased by 1.2% quarterly and to Final Consumption which increased by 1.0% quarterly.
- Hong Kong Manufacturing PMI: The Hong Kong Manufacturing PMI for November was reported at 38.5. Economists predicted a figure of 40.2. Forex traders can compare this to the Hong Kong Manufacturing PMI for October which was reported at 39.3.
- Chinese Caixin Services PMI and Chinese Caixin Composite PMI: The Chinese Caixin Services PMI for November was reported at 53.5. Economists predicted a figure of 51.2. Forex traders can compare this to the Chinese Caixin Services PMI for October which was reported at 51.1. The Chinese Caixin Composite PMI for November was reported at 53.2. Forex traders can compare this to the Chinese Caixin Composite PMI for October which was reported at 52.0.
Here are the key factors to keep in mind today for US Dollar trades:
- US ADP Employment Change: The US ADP Employment Change for November is predicted at 140K. Forex traders can compare this to the US ADP Employment Change for October which was reported at 125K.
- US Markit Services PMI and Markit Composite PMI: The US Final Markit Services PMI for November is predicted at 51.6 and the US Final Markit Composite PMI is predicted at 51.9. Forex traders can compare this to the previous US Markit Services PMI for November which was reported at 51.6 and to the previous US Markit Composite PMI which was reported at 51.9.
- US ISM Non-Manufacturing PMI: US ISM Non-Manufacturing PMI for November is predicted at 54.5. Forex traders can compare this to the US ISM Non-Manufacturing PMI for October which was reported at 54.7. The ISM Non-Manufacturing Business Activity Index for November is predicted at 56.1. Forex traders can compare this to the ISM Non-Manufacturing Business Activity Index for October which was reported at 57.0.
Should price action for the AUDUSD remain inside the or breakout above the 0.6815 to 0.6860 zone the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 0.6820
- Take Profit Zone: 0.7000 – 0.7080
- Stop Loss Level: 0.6790
Should price action for the AUDUSD breakdown below 0.6815 the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 0.6790
- Take Profit Zone: 0.6670 – 0.6710
- Stop Loss Level: 0.6815
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