- Private Sector Credit: Tuesday, 1:30. Borrowing levels remain low, pointing to softness in consumer spending. The indicator posted a gain of 0.3% in February and no changed is expected in the March release.
- AIG Manufacturing Index: Tuesday, 22:30. With China gripped by a slowdown, the Australian manufacturing sector is under pressure. The Australian Industry Group index fell to 51.0 in March, pointing to stagnation.
- Chinese Caixin Manufacturing PMI: Thursday, 1:45. The nasty trade war between the U.S. and China has taken a toll on the Chinese economy, and the manufacturing sector has been hard hit. The PMI has sagged in Q1, twice posting declines. The forecast for April is 51.0, indicative of muted activity.
- AIG Services Index: Thursday, 22:30. The index has been mired below the 50-level in Q1, pointing to contraction in the services index. The March release came in at 44.8 points.
- Building Approvals: Friday, 1:30. This key event tends to show sharp swings, making accurate estimates a tricky task. The February gain of 19.1% crushed the forecast of -1.7%. Will we see another strong gain in March?
*All times are GMT
AUD/USD Technical Analysis
Technical lines from top to bottom:
We start with resistance at 0.7480. This marked the high point of the pair in mid-July and defends the round 0.75 level.
The round number of 0.74 was the high point reached at the wake of December. This is followed by 0.7340, which the pair breached in late November.
0.7315 was a swing high seen in late September. Further down, 0.7240 separated ranges in September and in October.
0.7190 remains relevant and was tested during the week.
Lower, 0.7165 was a swing low after a recovery in mid-November. 0.7085 was a low point in September.
Close by, 0.6970 (mentioned last week) was under pressure late in the week as the pair posted sharp losses.
Below, 0.6825 supported the pair in late 2016 and early 2017.
0.6744 was a low point in January.
0.6686 was an important cap back in January 2000. It is the final support line for now.
I remain bearish on AUD/USD
The U.S-China trade war has taken a toll on the Australian economy, as China is Australia’s largest trading partner. With the RBA in dovish mode, the Aussie will have a tough time attracting investors.
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Safe trading!