Key Highlights
- The Aussie Dollar made a short-term top near 0.7900 against the US Dollar and moved down.
- There was a break below an important bullish trend line at 0.7850 on the 4-hours chart of AUD/USD.
- Recently in the US, the Chicago Fed National Activity Index for Sep 2017 posted a rise from -0.37 (revised) to 0.17.
- Today, the US Manufacturing PMI for Oct 2017 (Prelim) will be released, which is forecasted to increase from 53.1 to 53.6.
AUDUSD Technical Analysis
The Aussie Dollar after a solid rise towards 0.7900 failed against the US Dollar. The AUD/USD pair started a new downtrend and is currently well below 0.7850.
Looking at the 4-hours chart of AUD/USD, there was a break below an important bullish trend line at 0.7850. The pair also moved below the 50% Fib retracement level of the last wave from the 0.7732 low to 0.7897 high.
It seems like the recent trend line break at 0.7850 was crucial and will most likely ignite more losses in the near term. The next support on the downside is at 0.7780 followed by 0.7750. On the upside, resistances are at 0.7830, 0.7850 and 0.7880.
Chicago Fed National Activity Index
Recently in the US, the Chicago Fed National Activity Index (CFNAI) for Sep 2017 was released by Federal Reserve Bank of Chicago. The forecast was slated for a rise from the last reading of -0.31 to -0.10.
The actual result was better than the forecast, as there was a rise in the index to +0.17. On the other hand, the last reading was revised down to -0.37. However, the overall increase was way above the market forecast of 0.21.
The report stated:
All four broad categories of indicators that make up the index increased from August, and three of the four categories made positive contributions to the index in September. The index’s three-month moving average, CFNAI-MA3, was unchanged at –0.16 in September.
Overall, the AUD/USD pair remains at a risk of more declines as long as it is below 0.7840.
Economic Releases to Watch Today
Germany’s Manufacturing PMI for Oct 2017 (Preliminary) – Forecast 60.0, versus 60.6 previous.
Germany’s Services PMI for Oct 2017 (Preliminary) – Forecast 55.6, versus 55.6 previous.
Euro Zone Manufacturing PMI Oct 2017 (Preliminary) – Forecast 57.8, versus 58.1 previous.
Euro Zone Services PMI for Oct 2017 (Preliminary) – Forecast 55.7, versus 55.8 previous.
US Manufacturing PMI for Oct 2017 (Preliminary) – Forecast 53.6, versus 53.1 previous.
US Services PMI for Oct 2017 (Preliminary) – Forecast 55.6, versus 55.3 previous.
