Good Morning,
Welcome to our daily market update where we help keep you informed on the latest happenings in the world of FX, and show you what this means for the Mighty Aussie Dollar.
If you have any questions or would like anything further explained, please don’t hesitate to reach out to your account manager or email info@cafx.com
Key Data Being Released Today Wednesday the 1st of December 2021
- AUD – GDP
The Aussie Dollar – Fundamentals
The Aussie Dollar recovered from its year to date low at 0.7062 and climbed to the top end of its daily trading range 0.7170.
Having shown some resilience below the 0.7100 mark, the AUD/USD pair witnessed a turnaround from the lowest level since November 2020 amid a broad-based USD weakness. The developments surrounding the coronavirus saga forced investors to push back their expectations about the likely timing of when the Fed would begin tightening its monetary policy. This, in turn, undermined the greenback and prompted some short-covering move around the major.
In fact, the money markets now indicate a 25 bps rate hike in September 2022 as against July 2022 already priced in. This, along with the global flight to safety, triggered a steep decline in the US bond yields, which was seen as another factor that weighed heavily on the greenback. That said, the risk-off impulse – as depicted by a sharp fall in the equity markets – might keep a lid on any further gains for the perceived riskier Australian dollar.
The Aussie Dollar – Technical Analysis
Aussie Dollar had a volatile night trading in an 88-point range between 0.7170- 0.7062 creating a new 12 month low. With a range like this both buyers and seller would have been cleared out which makes for an interesting few trading sessions to come and will put significant pressure on the Key level of support at 0.7110. For if the market consolidates a break of this level, we will be into a new trading range.
Resistance on the Top Side – If the market rebounds higher resistance will start at 0.7172, then 0.7300 which will be closely followed by the 50-Day MA at 0.7333.
Support on the Downside – If the market continues to fall there is significant support at the 0.7110 level, then further support at 0.7000 and beyond that 0.6800.
AUD/USD Daily Chart
DXY (USD INDEX) Daily Chart
Major Global Markets
- Stocks
- S&P 500 closed at 4567
- NASDAQ closed at 16241
- ASX 200 closed at 7256
- Currencies
- AUD/USD – At the time of writing this report trades at 0.7128
- AUD/JPY – At the time of writing this report trades at 80.69
- AUD/CNH – At the time of writing this report trades at 4.5317
- DXY (US Dollar Index) – At the time of writing this report trades 95.891
- AUD/EUR – At the time of writing this report trades 0.6286
- Bonds
- US 10-year Bonds are currently at 1.456
- Aussie 10-year Bonds are currently at 1.708
- Commodities
- Iron Ore 62% – Trading at USD/T 94.97
- Gold – trading at USD/OZ 1775
- Brent Crude Oil – Trading at USD/Bbl 70.22