Australian PMI data this morning showed a minor slowdown in the pace of contraction, while the services and composite PMI reports were revised slightly higher. The Hong Kong manufacturing PMI surprised to the upside, while Chinese PMI data came in slightly below expectations. The AUDUSD stabilized at a minor horizontal support area, how will US data impact this currency pair? Subscribe to the PaxForex Daily Fundamental Analysis and grow your balance trade-by-trade.
Final services and composite PMI data out of the US marks the sole economic report released during the trading session. The attention is on escalating tensions between the US and Iran. A broad range of Asian and European PMI reports came in better than expected today, will the US data follow the same pattern? What does this mean for the AUDUSD? Today’s fundamental analysis will take a look at the upside potential as well as the downside risk in this currency pair.
Here are the key factors to keep in mind today for Australian Dollar trades:
- Australian AiG Performance of Manufacturing Index: The Australian AiG Performance of Manufacturing Index for December was reported at 48.3. Forex traders can compare this to the Australian AiG Performance of Manufacturing Index for November, which was reported at 48.1.
- Australian CBA Services PMI and CBA Composite PMI: The Final Australian CBA Services PMI for December was reported at 49.8. Forex traders can compare this to the previous Australian CBA Services PMI for December, which was reported at 49.5. The Final Australian CBA Composite PMI for December was reported at 49.6. Forex traders can compare this to the previous Australian CBA Composite PMI for December, which was reported at 49.4.
- Hong Kong Manufacturing PMI: The Hong Kong Manufacturing PMI for December was reported at 42.1. Economists predicted a figure of 36.5. Forex traders can compare this to the Hong Kong Manufacturing PMI for November, which was reported at 38.5.
- Chinese Caixin Services PMI and Chinese Caixin Composite PMI: The Chinese Caixin Services PMI for December was reported at 52.5. Economists predicted a figure of 53.2. Forex traders can compare this to the Chinese Caixin Services PMI for November, which was reported at 53.5. The Chinese Caixin Composite PMI for December was reported at 52.6. Forex traders can compare this to the Chinese Caixin Composite PMI for November, which was reported at 53.2.
Here is the key factor to keep in mind today for US Dollar trades:
- US Markit Services PMI and Markit Composite PMI: The US Final Markit Services PMI for December is predicted at 52.2 and the US Final Markit Composite PMI is predicted at 52.2. Forex traders can compare this to the previous US Markit Services PMI for December, which was reported at 52.2 and to the previous US Markit Composite PMI, which was reported at 52.2.
Should price action for the AUDUSD remain inside the or breakout above the 0.6925 to 0.6970 zone the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 0.6950
- Take Profit Zone: 0.7065 – 0.7125
- Stop Loss Level: 0.6900
Should price action for the AUDUSD breakdown below 0.6925 the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 0.6900
- Take Profit Zone: 0.6800 – 0.6840
- Stop Loss Level: 0.6925
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