Australia celebrated their first current account surplus with unchanged interest rate at 1%... for now
Today Australia released their current account surplus at 5.9B versus the previous fact -1.1B which is well ahead of the expectations, thanks to higher prices for export on Australia’s key resources like iron ore and coal.
Retail sales on the other hand were reported at a bigger decline than the forecast, came in at -0.1% MoM. RBA Governor Philip Lowe mentioned in his statement that personal consumption remains the biggest uncertainty for the economy. That being said, the interest rate was left unchanged, at the lowest rate in history at 1%, following 2 quarter rate cuts in June and July. The RBA will continue to closely monitor the situation with the labor market and ease further if needed, stated Gov. Lowe, but hope that recent cuts and lower interest rates will boost employment and inflation.
Australian GDP will be released tomorrow at 1:30 GMT with a slightly positive forecast for the second quarter.
The pair is also dependent on the US Dollar. There will be several releases from the US on Thursday, including durable goods orders, Markit composite PMI, non-farm productivity and initial jobless claims amongst others. I recommend for you to check the economic calendar for Thursday to get acquainted with the time releases. FRIDAY will be volatile for the USD as we will have the release of US Non-farm payrolls and unemployment rate figures published at 12:30 GMT.
TECHNICALLY: On a 4HTF, we see that the pair has left the Ichimoku cloud to the downside. We have a Bullish pin bar and strong bull power following RBA decision on interest rate. The price has broken the local trend line and Base line up, already surpassing the conversion line. Indicators are showing mixed signals – Parabolic SAR is pointing down and MACD is showing a reversal to the upside.
The Ichimoku cloud is still showing a bearish bias but the price has reached the bottom of the cloud, also looks like there is about to be a TK cross.
The US-Sino Trade war is not showing any new signs of positive progression and neither is Brexit, both are causing global economic tension and recession uncertainty. Therefore, short positions look to be more favorable in the mid to long term but we will evaluate both possibilities.
AS A RESULT:
If the pair sees growth, our safest bet would be to wait for the price to close above the Ichimoku Cloud – this may be close to a local area of resistance for August around 0.67485, after that our target would be the 23.6% Fibo at 0.67727 and after that I’d closely pay attention to again local areas of resistance around 0.67991 and 0.68180 ahead of 38.2% Fibo at 0.68318.
Target areas to the downside are a bit harder to predict as the pair is treading into 2009 lows territory. First target area will be 0.66967 closing low of Aug 7th then the 2019 low at 0.66771, and following that I’ve identified a possible are of support from Jan. 2009 in the area of 0.66577.
Today Australia released their current account surplus at 5.9B versus the previous fact -1.1B which is well ahead of the expectations, thanks to higher prices for export on Australia’s key resources like iron ore and coal.
Retail sales on the other hand were reported at a bigger decline than the forecast, came in at -0.1% MoM. RBA Governor Philip Lowe mentioned in his statement that personal consumption remains the biggest uncertainty for the economy. That being said, the interest rate was left unchanged, at the lowest rate in history at 1%, following 2 quarter rate cuts in June and July. The RBA will continue to closely monitor the situation with the labor market and ease further if needed, stated Gov. Lowe, but hope that recent cuts and lower interest rates will boost employment and inflation.
Australian GDP will be released tomorrow at 1:30 GMT with a slightly positive forecast for the second quarter.
The pair is also dependent on the US Dollar. There will be several releases from the US on Thursday, including durable goods orders, Markit composite PMI, non-farm productivity and initial jobless claims amongst others. I recommend for you to check the economic calendar for Thursday to get acquainted with the time releases. FRIDAY will be volatile for the USD as we will have the release of US Non-farm payrolls and unemployment rate figures published at 12:30 GMT.
TECHNICALLY: On a 4HTF, we see that the pair has left the Ichimoku cloud to the downside. We have a Bullish pin bar and strong bull power following RBA decision on interest rate. The price has broken the local trend line and Base line up, already surpassing the conversion line. Indicators are showing mixed signals – Parabolic SAR is pointing down and MACD is showing a reversal to the upside.
The Ichimoku cloud is still showing a bearish bias but the price has reached the bottom of the cloud, also looks like there is about to be a TK cross.
The US-Sino Trade war is not showing any new signs of positive progression and neither is Brexit, both are causing global economic tension and recession uncertainty. Therefore, short positions look to be more favorable in the mid to long term but we will evaluate both possibilities.
AS A RESULT:
If the pair sees growth, our safest bet would be to wait for the price to close above the Ichimoku Cloud – this may be close to a local area of resistance for August around 0.67485, after that our target would be the 23.6% Fibo at 0.67727 and after that I’d closely pay attention to again local areas of resistance around 0.67991 and 0.68180 ahead of 38.2% Fibo at 0.68318.
Target areas to the downside are a bit harder to predict as the pair is treading into 2009 lows territory. First target area will be 0.66967 closing low of Aug 7th then the 2019 low at 0.66771, and following that I’ve identified a possible are of support from Jan. 2009 in the area of 0.66577.