AUD analysis 03.03.2020

The Australian dollar fluctuated in a narrow range tilted towards the decline during the Asian session, to witness its rebound, its stability near its lowest level since mid-March 2009 against the US dollar, following the economic developments and data that it announced today, Tuesday, on the Australian economy and on the cusp of the decisions and directions of the Reserve Bank of Australia and the paucity of economic data. By the American economy the largest economy in the world.

At exactly 03:29 am GMT, the Australian dollar versus the US dollar fell 0.14% to 0.6528 levels compared to the opening levels at 0.6535, after the pair achieved its lowest level during the trading session at 0.6510, while the pair achieved its highest at 0.6549, with Knowing that the pair started the trading session on a falling price gap after it closed yesterday's trading at 0.6537.

We have followed the Australian economy on the disclosure of housing market data with the release of the Building Permits Index, which showed a 15.3% decline compared to a rise of 3.9% last December, worse than the expectations that indicated a rise of 1.1%, as the annual reading of the same index showed a decline 11.3% against a rise of 7.2% in the previous annual reading for the month of December, also the worst expectations for a rise of 1.9%.

This came in conjunction with the disclosure of the current account index reading, which showed that the surplus has shrunk to A $ 1.0 billion compared to A $ 6.5 billion in the previous reading for the third quarter, worse than expectations that indicated the surplus to shrink to A $ 2.3 billion, and a reading of the index showed Net exports from the fourth quarter GDP slowed the pace of growth to 0.1% compared to the previous reading for the third quarter and expectations at 0.2%.

Otherwise, investors are looking to the decisions and directions of monetary policy makers at the Reserve Bank of Australia with the release of the Australian Central Bank’s statement of interest rates amid expectations to reduce them by 25 basis points to 0.50% after stabilizing them in the previous three meetings in the wake of reducing them last year three times by 25 basis points To 0.75%, before we witness tomorrow, Wednesday, the disclosure of the fourth quarter growth data, which may reflect the stability of growth at 0.4%.

On the other hand, investors are currently looking forward to the talk of Federal Open Market Committee member and President of the Federal Reserve Cleveland Bank Loretta Mester about the economic outlook and monetary policy at the annual dinner of the Society of Professional Economists in London, and this comes hours after the US President criticized the Fed’s position and the political situation The current criticism, expressing the delay of the Fed and his Powell Governor in taking decisions.

U.S. President Trump, through his Twitter account via his official account on Twitter, also expressed that Germany and a number of countries are pumping money to support their economy, and that the major central banks in other countries are more strict in making decisions, adding that due to many reasons the United States should have The lowest rate of interest, explaining that this was not done by the Federal Reserve and his Powell Governor.

Markets are currently pricing the Federal Reserve to resume cutting interest on federal funds this year and reducing them by 50 basis points to between 1.00% and 1.25% at the March 17-18 meeting, and after cutting them three times by 25 basis points last year To 1.50% and 1.75%, and looking forward also to the Federal Committee revealing its expectations for the future of interest rates and the rate of growth, inflation and unemployment for the next three years.

Technical analysis

The Australian dollar versus the US dollar continues to provide positive trades, on the way to a possible visit to resist the descending channel that appears in the picture, which makes us highly likely to witness more bullish bias during the upcoming sessions, waiting for the 0.6630 level to be tested before returning back down again.

Therefore, the bullish trend will be expected for today, noting that failure to surpass 0.6575 will stop the suggested rise and press the price to resume the main bearish trend again.

The expected trading range for today is between 0.6500 support and 0.6600 resistance.

Expected trend for today: temporarily bullish.