AUD analysis 31.01.2020

The Australian dollar fluctuated in a narrow range tilted towards the decline during the Asian session, to prepare for the longest march of its weekly losses since mid-2015 and to witness its stability near its lowest since early October, when it tested the lowest since mid-March 2009 against the US dollar after developments And the economic data that it published on the Australian economy and on the cusp of developments and economic data expected Friday by the US economy, the largest economy in the world.

At exactly 02:39 am GMT, the Australian dollar pair fell against the US dollar by 0.09% to 0.6716 levels compared to the opening levels at 0.6722, after the pair achieved its lowest level during the trading session at 0.6706, while the pair achieved its highest at 0.6730.

On the Australian economy, we have followed the release of the PPI reading, which is an initial indicator of inflationary pressures, which showed a slowdown in growth to 0.3%, in line with expectations, compared to 0.4% in the third quarter, as the annual reading of the same index showed a slowdown in growth to 1.4% compared to 1.6% in The previous annual reading, and that came before we witnessed a reading of the private sector credit index showed stability at 0.2%, in line with expectations during December.

On the other hand, investors are currently awaiting by the US economy to disclose spending and personal income data, which may reflect a slowdown in personal spending growth to 0.3% versus 0.4% last November, and a slowdown in personal income growth to 0.3% compared to 0.5% in August November, while a reading of the core personal consumption expenditures index may show the stability of the pace of growth in December at 0.1%.

This comes in conjunction with the disclosure of the unit labor cost index reading, which may reflect the stability of growth at 0.7%, little changed from what it was in the third quarter, and before we witness the disclosure of industrial bottom data for the largest industrial country in the world with the release of the Chicago PMI reading Which may reflect the stability of the contraction at 48.9, little changed from last December.

To reveal the final reading of the University of Michigan's index of consumer confidence, which may show the stability of the expansion at 99.1 unchanged from the initial reading of the previous month this month and against 99.3 in December, and this comes hours after the Federal Open Market Committee meeting, which approved the monetary policy makers The Federal Reserve has cut interest rates for the third consecutive meeting by 25 basis points, between 1.50% and 1.75%.

Technical analysis

The Australian dollar versus the US dollar pair shows more bearish tendency to gradually approach our awaited target at 0.6670, and it falls under continuous negative pressure coming from the EMA50, to support the chances of the continuation of the descending wave during the coming period, noting that breaking the mentioned level will push the price to 0.6615 As a next negative target.

Consequently, the expected decline will remain valid unless the 0.6820 level is breached and stability above it.

The expected trading range for today is between 0.6670 support and 0.6750 resistance.

Expected trend for today: bearish.