AUD/USD hit a low yesterday of 0.9057, thus testing, but failing to trigger my proposed stop loss at 0.9040 and the trade idea has now moved back into positive territory.
Good bids have come back into the AUD and we have seen a subsequent move back above the 91 handle. On the hourly chart we’ve even seen the MACD cross above zero, while stochastic’s are showing better strength. I still like the trade higher from here, but again looking at the hourly chart there is good supply around 0.9150 and we will need to see the pair clear this level in the short-term.
At 11:30 we get Australian Q3 GDP read and the market expects growth of 0.7% (2.6% annualised). I feel this print should come out in-line, if not modestly higher, however it still needs to be remember that this level of growth is still below trend. Yesterday’s RBA statement was fairly unchanged, however for me the fact they have left its non-urgent easing bias in place is a tactical move, designed to take advantage of the future actions of the Fed, who could taper in March (perhaps earlier if payrolls this Friday are strong).
I continue to watch price action, but favour upside in the short-term, although any bounces to my proposed limit could represent a good chance to square and reverse and look at shorting opportunities.