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
More View more
Real Time News
  • The US Dollar seems to be back on the offensive against its major counterparts, pressuring EUR/USD and NZD/USD lower as USD/JPY consolidates. USD/CHF surges past key resistance. Get your market update from @ddubrovskyFX here:https://t.co/MrLGSp7FYa https://t.co/XS0176LyOg
  • The Japanese Yen remains in focus with strength potential on risk aversion themes to go along with weakness on themes around higher rates. Get your weekly $JPY technical forecast from @JStanleyFX here: https://t.co/l4UICqJzJy https://t.co/dQ2pS0E4fp
  • Google finance-related search interest in 'Evergrande' has almost overtaken 'Covid'. 'Taper' doesn't even register on the scale https://t.co/P6H9sHFVIB
  • Gold prices gain as potential systemic risks out of China's Evergrande Group roil broader markets. Meanwhile, iron ore is ticking higher after a big drop on Monday as China steps up steelmaking curbs. Get your market update from @FxWestwater here:https://t.co/l4kAWDJ2wm https://t.co/b9m5ADIqqb
  • Gold remains higher despite positive Evergrande news out of China. Meanwhile, copper bulls are pushing prices upward as the potential for a housing crisis in China ebbs. Get your market update from @FxWestwater here:https://t.co/TK3MNntBdA https://t.co/14UKjR4w6M
  • GBP/USD has flattened overnight after its strongest rally in a month on Thursday. The British currency has been under pressure recently as an energy crisis has caused a number of gas providers to go bankrupt. Get your market update from @HathornSabin here:https://t.co/3D8s2eIVWv https://t.co/JDGNwKYyOn
  • Japanese candlesticks are a popular charting technique used by many traders, and the shooting star candle is no exception. Learn about the shooting star candlestick and how to trade it here: https://t.co/mfwJ0sIauS https://t.co/JIT5it2HAt
  • Gold could suffer further near-term losses due to rising U.S. Treasury yields and a weak technical picture for price action. Get your weekly gold forecast from @DColmanFX here: https://t.co/g9QvH3L4It https://t.co/Vz98E0Bl9U
  • Gold has been trending lower after failing to clear resistance in the $1835 area earlier this month. Get your $XAUUSD market update from @DColmanFX here:https://t.co/3hm1g3BHgf https://t.co/MdTQKEBCBx
  • Key break here in the 10-year #Treasury yield as it rises to the highest since late June Took out 1.4230 resistance, and the 100-day SMA Eyes now on the 38.2% Fib extension at 1.4775 Also potential falling resistance from March https://t.co/4cI6l210ui
Australian Dollar Hit By Weak China PMIs, RBA, G20 Eyed

Australian Dollar Hit By Weak China PMIs, RBA, G20 Eyed

David Cottle, Analyst

Australian Dollar, China PMI, Talking Points:

  • The Australian Dollar was hit by disappointing Chinese PMI
  • Manufacturing there is in a parlous state, but the service sector underperformed too
  • The market is now looking with even more hope to Mr. Trump and Mr. Xi

Fourth-quarter technical and fundamental forecasts from the DailyFX analysts are here.

The Australian Dollar took a knock Friday from some disappointing Chinese economic data, some of which suggested that the manufacturing sector there was close to contraction.

Its official November Purchasing Managers Index came in at 50, just below the expected 50.2 print which had also been October’s score. In the logic of PMIs any reading above 50 signifies expansion so this latest release was, uncomfortably, right on the line. It was also the weakest PMI since early 2016, suggesting strongly that a slowing overall economy and, probably, US tariffs, are really starting to bite. The service sector PMI was 53.4, clearly much stronger but still below both the expected 52.8 and the previous month’s 52.9. The composite came in at 52.8.

AUD/USD fell a little after the data. The Australian Dollar can act as the foreign exchange markets’ favorite liquid China proxy thanks to its home country’s huge export links with the world’s second largest economy.

Australian Dolalr Vs US Dollar, 5-Minute Chart

However, market focus is now squarely on this weekend’s Group of 20 summit in Argentina, at which US President Donald Trump will meet his Chinese counterpart Xi Jinping. Hopes are high for somewhat of a thaw in frozen trade relations between the two countries and these latest data perhaps highlight how pressing a deal could be for global growth, and Chinese growth in particular.

On its broader, daily chart AUD/USD has been boosted in recent weeks up to highs not seen in August as investors have clung to those trade hopes and, to some extent, relaxed expectations of US interest rate rises next year.

Downtrend Broken. Australian Dollar Vs US Dollar, Daily Chart

That said the Reserve Bank of Australia will meet to set monetary policy next week, on Tuesday. With no increase to Australia’s record-low Official Cash Rate priced into futures markets well into 2020, it seems unlikely that the Australian Dollar can hope for sustained support against the greenback on interest-rate differential grounds. The RBA may also have something to say about AUD/USD's resurgence, given its oft-repeated view that currency strength makes its inflation target harder to hit.

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