Source: PaxForex Premium Analytics Portal, Fundamental Insight
The Final Australian S&P Global Manufacturing PMI for October came in at 52.7. Forex traders can compare this to the Australian S&P Global Manufacturing PMI for September at 53.5.
The Reserve Bank of Australia increased interest rates by 25 basis points to 2.85%. Economists predicted a rise of 25 basis points from 2.60%. Forex traders can compare this to the previous Reserve Bank of Australia interest rate decision, where it hiked rates by 25 basis points. It represents the seventh hike in the past seven months, but the Australian central bank also increased its inflation outlook and noted more interest rate increases are necessary. The RBA continues with smaller rate hikes and often leads other central banks, which could begin slowing their pace from December. Traders should not confuse the decrease in pace as a sign that the inflation fight or high borrowing costs are near the end, as central banks have not reached their terminal rate, after which point there could be no change for years to come.
Australian Commodity Prices for October rose 22.4% annualized. Forex traders can compare this to Australian Commodity Prices for September, which surged 30.6.
The Final US S&P Global Manufacturing PMI for October is predicted at 49.9. Forex traders can compare this to the US S&P Global Manufacturing PMI for September at 52.0.
US Construction Spending for September is predicted to decrease by 0.5% monthly. Forex traders can compare this to US Construction Spending for August, which dropped 0.7% monthly.
US JOLTS Job Openings for September are predicted at 10.000M. Forex traders can compare this to US JOLTS Job Openings for August, reported at 10.053M.
The US ISM Manufacturing Index for October is predicted at 50.0, and ISM Prices Paid at 52.5. Forex traders can compare this to the US ISM Manufacturing Index for September, reported at 50.9, and ISM Prices Paid at 51.7. ISM Employment Index for October is predicted at 53.0. Forex traders can compare this to ISM Employment Index for September, reported at 48.7.
The forecast for the AUD/USD remains cautiously bullish after this currency pair completed a breakout above its horizontal support area. Short-term volatility may rise with the Kijun-sen crossing below the Tenkan-sen, but both turned flat, noting the absence of downside pressure. The Ichimoku Kinko Hyo Cloud shows signs of ending its downtrend after the Senkou Span B sidelined, but the Senkou Span A maintains its downtrend, confirming a potential volatility rise. Traders should monitor the CCI following its breakdown from extreme overbought territory, from where a new push higher is likely. Can bulls withstand bearish pressures and power the AUD/USD into its horizontal resistance area? Subscribe to the PaxForex Daily Fundamental Analysis and earn over 5,000 pips per month.
Should price action for the AUD/USD remain inside the or breakout above the 0.6395 to 0.6450 zone, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 0.6430
- Take Profit Zone: 0.6750 – 0.6860
- Stop Loss Level: 0.6340
Should price action for the AUD/USD breakdown below 0.6395, PaxForex the following trade set-up:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 0.6340
- Take Profit Zone: 0.6235 – 0.6295
- Stop Loss Level: 0.6395
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