News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
Wall Street
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • Greed is a natural human emotion that affects individuals to varying degrees. Unfortunately, when viewed in the context of trading, greed has proven to be a hindrance more often than it has assisted traders. Learn how to control greed in trading here: https://t.co/kODPAfJE79 https://t.co/IRS9MaA7h8
  • The Federal Reserve rate decision is likely to sway the near-term outlook for the price of gold as the central bank appears to be on track to scale back monetary support. Get your weekly gold forecast from @DavidJSong here: https://www.dailyfx.com/forex/fundamental/forecast/weekly/CHF/2021/09/18/Gold-Price-Outlook-Hinges-on-Fed-Rate-Decision-Forward-Guidance.html https://t.co/dWWxtErjK0
  • Forex liquidity makes it easy for traders to sell and buy currencies without delay, and also creates tight spreads for favorable quotes. Low costs and large scope to various markets make it the most frequently traded market in the world. Learn more here: https://t.co/arxYmtQeUn https://t.co/4qxwiJsV1K
  • Forex quotes reflect the price of different currencies at any point in time. Since a trader’s profit or loss is determined by movements in price, it is essential to develop a sound understanding of how to read currency pairs. Learn how to read quotes here: https://t.co/CNtqrKWDBY https://t.co/stMPuq0VXR
  • A currency carry trade involves borrowing a low-yielding currency in order to buy a higher yielding currency in an attempt to profit from the interest rate differential. Find out if the carry trade suits your trading style here: https://t.co/7t4BzmLg8w https://t.co/v6RGICQvge
  • Get your snapshot update of the of top level exchanges and key index performance from around the globe here: https://t.co/d8Re5anlG5 https://t.co/rws9LHJV3E
  • RT @FxWestwater: Japanese Yen Forecast: JPY Crosses Eye BoJ, CPI as Haven Flows Bolster Yen Strength Link: https://www.dailyfx.com/forex/fundamental/forecast/weekly/jpy/2021/09/18/Japanese-Yen-Forecast-JPY-Crosses-Eye-BoJ-CPI-as-Haven-Flows-Bolster-Yen-Strength.html?CHID=9&QPID=917708&utm_source=Twitter&utm_medium=Westwater&utm_campaign=twr https:/…
  • Traders utilize varying time frames to speculate in the forex market. The two most common are long- and short-term-time frames which transmits through to trend and trigger charts. Learn more about time-frame analysis here: https://t.co/9S5tXIs3SX https://t.co/FVisZuTP6M
  • Stocks appear to be in a corrective phase but could get put to the test; levels and lines to watch in the days ahead. Get your weekly equities forecast from @PaulRobinsonFX here: https://t.co/H1BaTlIHjY https://t.co/zP3mjfslSD
  • Currency exchange rates are impacted by several factors. Are different world leaders a contributing factor? Find out here: https://t.co/4jsORznRTE https://t.co/Of1thU4zXw
Australian Dollar Likely Loser In Ugly Contest With US Cousin

Australian Dollar Likely Loser In Ugly Contest With US Cousin

David Cottle, Analyst
AUDUSD

Fundamental Australian Dollar Forecast: Bearish

  • Interest rate differentials are back to the fore
  • The US Dollar has lost some support thanks the Federal Reserve’s latest commentary
  • But the Fed has also made investors aware that the likes of the Aussie have even less support

Find out what retail foreign exchange traders make of the Australian Dollar’s prospects right now, in real time, at the DailyFX Sentiment Page

The Australian Dollar faces a very modest week of domestic economic data which will likely leave current themes to play out a little further.

The currency shared fully in the lift given to many US Dollar rivals when the Federal Reserve struck a dovish monetary policy tone last Wednesday. That central bank now only expects rates to rise once before the end of 2020 as a base case, and some futures markets doubt that we’ll see even that solitary move. No wonder the greenback slipped.

However, there was a little rethink shortly after the Fed shot its bolt. Markets came to the fully logical conclusion that, if the US is going to halt monetary tightening, then those who’ve yet to start surely won’t be doing so anytime soon. This category includes of course the Reserve Bank of Australia. Its own key short-term interest rate is stuck at the 1.50% record-low which has pertained since August 2016. Indeed, the RBA itself changed tack last month and admitted that more cuts could be needed. Before it had loudly trumpeted the view that the next move was likely to be a rise.

If the Fed’s announcement has turned developed market currency trading into a ‘least ugly’ tournament, then the US Dollar is at present the most likely winner simply because its base rates start the contest higher than most.

There was a little cloud cast over one of the Australian economy’s brightest spots last week. Official employment data showed a very modest increase in overall employment and a sharp-fall in full time hiring. Both were glossed over in the market by news that the official unemployment rate edged down in February below 5%, for the first time since 2011. Still, there’s no denying that this was a very mixed set of figures and a very far cry from the blockbuster releases we’ve become almost used to. This series can be volatile but the next release will bear close watching. After all, even strong employment growth has proven resolutely non-inflationary for Australia, part of the clear lack of pricing power which continues to weigh on Australian interest rates.

In the coming week then, the Aussie may well benefit as it often does from any gains in general market risk appetite. But with interest rate differentials back to the fore, its bulls may find little to celebrate. It’s a bearish call this week.

Looking for a technical perspective on the AUD? Check out the Weekly AUD Technical Forecast.

AUDUSD

Resources for Traders

Whether you’re new to trading or an old hand DailyFX has plenty of resources to help you. There’s our trading sentiment indicator which shows you live how IG clients are positioned right now. We also hold educational and analytical webinars and offer trading guides, with one specifically aimed at those new to foreign exchange markets. There’s also a Bitcoin guide. Be sure to make the most of them all. They were written by our seasoned trading experts and they’re all free.

--- Written by David Cottle, DailyFX Research

Follow David on Twitter@DavidCottleFX or use the Comments section below to get in touch!

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES