AUDUSD Analysis 07.02.2019

The Australian dollar fell during the Asian session to see its rebound for the third session in five sessions of its highest since December 5 against the US dollar after Governor of Australia Reserve Bank Philip Louis in Sydney and the State of the Union address to President Donald Trump in Washington on the eve of developments And economic data expected Wednesday by the US economy, the largest economy in the world.

At 02:32 GMT, the AUDUSD fell 0.87% to 0.7171 compared to the opening levels at 0.7235, after reaching a low of 0.7166, while reaching a high of 0.7246.

Australian Central Bank Governor Philippe Lowe told the National Press Club that interest rate expectations are broadly balanced, as they were priced in the markets as cautious comments from the Reserve Bank of Australia. "Over the past year, The next step up is likely on the scenario that the next step will be reduced, and today the odds are moderately balanced. "

He noted that if the labor market saw more strength and tightening, interest rates could rise, while any weakness in the labor market would hurt the Reserve Bank of Australia to reassess the situation. This came hours after the central bank's monetary policymakers decided to set interest rates for the 28th meeting Respectively at 1.50% and the release of the Bank of Australia's Interest Rate Statement on Tuesday.

On the other hand, we followed US President George Bush's State of the Union address, which rekindled concerns about a new partial closure of the Federal Government. The markets are looking forward to the initial reading of a single labor cost index for the fourth quarter, To 1.7% from 0.9% in the third quarter.

The markets are also closely approaching the preliminary reading of US non-farm productivity, which may show growth slowing to 1.7% versus 2.3% in the third quarter, in conjunction with the November trade balance reading, which may indicate a contraction of the deficit to 54.0 $ Billion against $ 55.5 billion last October.

In another context, we are expected to see early Thursday the talk of Federal Reserve Federal Reserve Federal Reserve Committee Chairman Randall Quarles about the stress test for banks at the Council for Economic Education in New York, an hour before Federal Reserve Governor Jerome Powell at a meeting Hall The Virtual City of Teachers Nationwide in Washington.

In the same vein, we followed the Fed's statement earlier this week that at the invitation of US President Trump, Federal Reserve Governor Paul and his deputy Richard Clarida joined US President and Treasury Secretary Stephen Menuchin for an informal dinner at the White House to discuss developments The economic outlook for growth, the labor market, and inflationary pressures, and that Powell's comments on this were consistent with his remarks at his recent press conference and that he did not discuss his expectations for monetary policy.

Powell said that the Federal Reserve's monetary policy path will depend mainly on the economic information received and what this means for expectations. He said on Monday that he and his colleagues in the Federal Commission will develop a monetary policy aimed at reaching the full employment and price stability of workers and that their decisions are based only on analysis Objective, and non-political. We would like to point out that this is the first meeting of the American president since he took Powell's nomination and following Trump's recent criticism of Powell for lifting the latter last year.

Federal Reserve monetary policy makers kept interest rates between 2.25% and 2.50% last week while continuing to cut bond purchases by $ 50 billion per month. Federal Commissioner Jerome Powell said that the committee would be patient and monitor economic data as the downside risks to the economy worsened due to the weakening of global growth and fluctuations in financial precedents. Whether or not this approach will continue depends on economic data.

Technical Analysis

The AUDUSD is showing further downside to near our target of 0.7075, and we believe that the area is open for the continuation of the bearish trend with the next target at 0.6982, supported by the negative pressure formed by SMA 50.

All in all, we continue to push the bearish trend unless the level of 0.7170 is breached and stability above it.

The trading range for today is among the key support at 0.6982 and resistance at 0.7150

The general trend for today is bearish