The Australian Dollar stabilized after consumer confidence rebounded, but bullish momentum remained muted after building approvals slumped steeper than anticipated. Forex traders are also in a holding pattern amid the next round of trade talks between the US and China. With an interest rate cut by the US Fed looming, the AUDUSD is hovering at strong support levels. Can bulls ignite a short-covering rally or will bears push price action further to the downside? Subscribe to the PaxForex Daily Fundamental Analysis where you will grow you balance trade-by-trade!
Here are the key factors to keep in mind today for Australian Dollar trades:
- Australian ANZ Roy Morgan Weekly Consumer Confidence Index: The Australian ANZ Roy Morgan Weekly Consumer Confidence Index for the week of July 28th was reported at 118.5. Forex traders can compare this to the Australian ANZ Roy Morgan Weekly Consumer Confidence Index for the week of July 21st which was reported at 116.3.
- Australian Building Approvals: Australian Building Approvals for June decreased by 1.2% monthly and by 25.6% annualized. Economists predicted an increase of 0.2% monthly and a decrease of 24.3% annualized. Forex traders can compare this to Australian Building Approvals for May which increased by 0.3% monthly and which decreased by 19.2% annualized.
US personal income and spending data will be front and center today for US Dollar trades. Economists expect a slowdown as compared to last month, but are forex traders prepared for a potential downside surprise? Today is the start of the two-day FOMC meeting and expectations call for a 25 basis point interest rate cut announcement tomorrow. The European Central Bank and the Bank of Japan decided to wait out the US Fed and left their interest rates unchanged. Is now the right time to buy the AUDUSD? Today’s fundamental analysis will take a look at price action in both directions.
Here are the key factors to keep in mind today for US Dollar trades:
- US Personal Income and Personal Spending: US Personal Income for June is predicted to increase by 0.3% monthly and Personal Spending is predicted to increase by 0.3% monthly. Forex traders can compare this to Personal Income for May which increased by 0.5% monthly and to Personal Spending which increased by 0.4% monthly. Real Personal Spending for June is predicted to increase by 0.2% monthly. Forex traders can compare this to Real Personal Spending for May which were increased by 0.2% monthly. The PCE Deflator for June is predicted to increase by 0.1% monthly and by 1.5% annualized. Forex traders can compare this to the PCE Deflator for May which increased by 0.2% monthly and by 1.5% annualized. The PCE Core Deflator for June is predicted to increase by 0.2% monthly and by 1.7% annualized. Forex traders can compare this to the PCE Core Deflator for May which was increased by 0.2% monthly and by 1.6% annualized.
- US S&P/Case-Shiller Composite 20: The US S&P/Case-Shiller Composite 20 for May is predicted to increase by 0.20% monthly and by 2.40% annualized. Forex traders can compare this to the US S&P/Case-Shiller Composite 20 for April which was reported flat at 0.00% monthly and which increased by 2.54% annualized.
- US Pending Home Sales: US Pending Home Sales for June are predicted to increase by 0.30% monthly and to decrease by 0.7% annualized. Forex traders can compare this to US Pending Home Sales for May which increased by 1.1% monthly and which decreased by 0.8% annualized.
- US Consumer Confidence: US Consumer Confidence for July is predicted at 125.0. Forex traders can compare this to US Consumer Confidence for June which was reported at 121.5.
Should price action for the AUDUSD remain inside the or breakout above the 0.6860 to 0.6915 zone the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 0.6890
- Take Profit Zone: 0.7045 – 0.7080
- Stop Loss Level: 0.6830
Should price action for the AUDUSD breakdown below 0.6860 the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 0.6820
- Take Profit Zone: 0.6600 – 0.6695
- Stop Loss Level: 0.6890
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