USD AUD

FXstreet.com (Barcelona) - Forward-looking indicators of the global industrial cycle suggest economic momentum should pause or ease in the first half of 2012, according to ANZ Macro Strategy Team: "The rebalancing of growth in China, which is reportedly already underway, also suggests some slowing, although a repeat of the disappointingly deep slow down of 2011 is not expected, but a temporary pause in the manufacturing cycle appears possible."

The Australian Dollar, battered against the US Dollar recently, should base now above the 1.0300 level in the event of a modest slowdown in global economies, note Tim Riddell and Andrew Salter, Head of Golbal Market Research and FX strategist at ANZ. In this environment the Australian dollar's appreciation would slow. The question concerning markets is where will it base in the near term?

"Given the correlation with indicators of the industrial cycle, we might expect it to ease as far as US1.0350 on a monthly average basis if the slow down is modest, as we expect. If it is a slowdown of the kind witnessed in 2011, or one centered more specifically in China, and the AUD experiences a somewhat deeper correction, technical indicators suggest that a re-test of long-term support above USD0.98 would ensue" the analysts observe.

The analysts conclude: "Looking further ahead we are optimistic that the currency will see levels of USD1.10 in the medium term. The high level of commodity price, the wide interest rate available to offshore investors, and the notable changes occurring in developed economies with regards to expanding money supplies and changing credit ratings will all conspire to see the currency strong over the medium term."

USD/AUD

FXstreet.com (San Francisco) - The Australian dollar managed to gain on the U.S. Dollar Tuesday as the greenback sold off mildly in favor of higher yielding currencies and risk-correlated assets after the FOMC statement late in the global day.

AUD/USD bounced from session extremes around 1.0485 to levels back near the highs of the day before slight pullback to close at 1.0550, 35 pips above its starting price. In early Asia, the pair is under gentle pressure as it trades down 1.0535. To the upside, immediate resistance lies at 1.0567 (1 Feb low), while, to the downside, support lies at 1.0508 (7 Mar low). 

USD

The single currency started the week on a weak note especially during the early Asian session sliding to a fresh low of 1.3077. But it covered the losses during the late Asian session and early European session. The pair is currently trading around 1.3113, almost flat for the day. The support may be seen at 1.3080 and below at 1.3000 levels. The resistance may be seen at 1.3160 and above 1.3220. Wholesale price index from Germany came as expected at 1% month over month.

Unlike Euro, sterling pound failed to gather a momentum and it continued its downward run to form a fresh low of 1.5608. The pair is currently trading around 1.5630, down about quarter of a percent for the day. The bearish outlook opens up the possibility of breaking of 1.5600 levels significantly. The support may be seen at 1.5600 and below at 1.5560. The resistance may be seen at 1.5660 and above at 1.5710 levels.

 

The USD/CHF pair managed to close the last week near the 0.9200 levels. It started the week on a positive note and went above the 0.9200 levels to form a fresh high of 0.9217. But it failed to hold the 0.9200 levels and has come below it. It is currently trading around 0.9192, almost flat for the day. The resistance may be seen at 0.9200 and above at 0.9250. The support may be seen at 0.9150 and below at 0.9125 levels.

 

The USD/JPY has come off the recent highs and trading in red for most part of the day. The pair is currently trading around 82.20, down about 0.37% for the day. The resistance may be seen at 82.65 and 83 levels while the support may be seen at the current levels and below at 81.90 levels.

The trade deficit report from China has impacted the Australian dollar and the it is currently trading at 1.0514, down about half a percent against the US dollar. The low for the day so far is formed at 1.0508. The support may be seen at 1.0500 and below at 1.0450. The resistance may be seen at 1.0560 and 1.0610 levels.