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AUD/USD still shy of 0.95 after strong Chinese data

The Australian dollar received another reason to rise after the strong  inflation numbers in Australia:  The flash purchasing managers’ index for the manufacturing sector in China reached 52 points, significantly better than 51 points expected. This independent measure of Australia’s No. 1 trading partner is certainly encouraging.

However, AUD/USD made its way only some 30 pips higher to 0.9470, and dropped back down to the previous range afterwards.  It seems to hesitate towards 0.95. Why?

One  explanation is that the pair was knocked down from this level not too long ago. After it hit this level and retreated, RBA governor Glenn Stevens gave it another blow and sent it lower.

Another reasons is what happened in New Zealand: while the RBNZ raised the rates for the fourth time, it hinted of a long pause in hikes, intervened verbally to weaken the currency and even hinted at real interventions. There is some correlation between both countries.

AUDUSD July 24 2014 technical chart for currency trading Aussie dollar

 

In any case, 0.95 is now an even stronger line of resistance.  Support is found at 0.9425. For more levels, events and analysis, see the AUD to USD prediction.

Yohay Elam

Yohay Elam

Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.