AUD analysis 03.02.2020

The Australian dollar fluctuated in a narrow range tilted to the upside during the Asian session, to witness its bounce to the second session from the lowest since October 2, when it tested the lowest since mid-March 2009 against the US dollar, following the economic developments and data that it reported on the Australian economy and on The expected economic developments and data on Monday by the US economy, the largest economy in the world.

At exactly 02:39 AM GMT, the Australian dollar pair rose against the US dollar by 0.12% to 0.6696 levels compared to the opening levels at 0.6688, after the pair achieved its highest level during the trading session at 0.6705, while the pair achieved its lowest at 0.6682, with Knowing that the pair started the trading session on a falling price gap after it concluded the trading last week at 0.6692.

On the Australian economy, we have followed the disclosure of the AIG manufacturing index reading, which showed the contraction widened to 45.4 compared to 48.3 last December, and this came before we witnessed the Melbourne Institute (MI) disclosing an index reading An inflation gauge that showed growth stabilized at 0.3% in January, while the annual reading of the same indicator showed that growth accelerated to 1.8% versus 1.4%.

Up to the disclosure of Australian housing market data with the release of the Building Permits Index, which showed a 0.2% decline against a rise of 10.9% last November, contrary to expectations that indicated a 5.0% decline, while the annual reading of the same index showed an increase of 2.7% compared to a decline 2.8% in the previous annual reading for the month of November, also outperforming the expectations that indicated a decline to 1.4%.

This came in conjunction with the disclosure of preliminary data for the Australian labor market with the release of the job ads index, which showed a rise of 3.8% against a decline of 5.7% in December. Otherwise, the markets look to tomorrow, Tuesday, the decisions and directions of monetary policy makers at the Reserve Bank of Australia with The Central Bank of Australia's interest rate statement was issued amid expectations that it would be fixed for the third consecutive meeting.

Markets are also looking after tomorrow, Wednesday, for what will come out of the speech of the Australian Central Bank Governor, Philip Liu, who is scheduled to deliver a speech under the title "next year" at the National Press Club in Sydney, before he testifies next Thursday before the Permanent Committee for the Economy in the House of Representatives In Canberra, hours before the Reserve Bank of Australia unveiled its monetary policy statement for its meeting tomorrow, Friday.

On the other hand, investors are currently awaiting by the US economy the disclosure of the final reading of the manufacturing PMI by Markit on the United States of America the largest industrial country in the world, which may reflect the stability of the expansion at a value of 51.7 without any change from the initial reading for January, against a value of 52.4 last December.

This comes before we witness the disclosure of the Institute of Industrial Supply index reading, which may show contraction shrinkage to 48.5 compared to 47.2 in December, while the reading of the Institute of Industrial Supply measured in prices may expand to 52.0 compared to 51.7 in December, in conjunction with the release of the construction spending index, which reflects a slowdown in growth to 0.5% compared to a decline of 0.6% in November.

Technical analysis

The Australian dollar versus the US dollar continues the negative crawl to settle near our awaited target 0.6670, and it comes under negative pressure formed by the EMA50, which supports the chances of breaking the mentioned level to head towards our next negative target which is located at 0.6615.

Therefore, we will continue to favor the bearish trend for the upcoming period, noting that stability below 0.6820 is important for the continuation of the expected decline.

The expected trading range for today is between 0.6650 support and 0.6730 resistance.

Expected trend for today: bearish.