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AUD/USD ignores risk-off, tracks oil higher

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Feb 29, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    The AUD/USD pair remains largely indifferent to the persisting risk-averse market conditions and stages a minor-recovery on 0.71 handle.

    AUD/USD takes-out 100-DMA

    Currently, the AUD/USD pair trades 0.17% at fresh session highs of 0.7139, finding fresh bids at 0.7109, session lows. The Aussie caught a fresh bid tone and rebound higher from just ahead of 0.71 barrier, mainly driven by the oil price rebound. Both oil benchmarks are seen extending the recovery, with the US oil up 0.70% while the Brent jumps 1.50%.

    The AUD/USD pair defied the bears and appears to shrug-off the poor sentiment on the Asian indices, as the prices continue to track the recovery in oil and gold prices. Further, the weak Australian economy data also failed to dent the sentiment around the Aussie.

    The Melbourne institute inflation gauge slipped 0.2% m/m in February, the biggest decline since June 2012. On an annualized basis, the inflation gauge signaled a 2.1% rise in the CPI, easing from 2.4% in January.

    Meanwhile, all eyes remain on the much-awaited RBA cash rate decision due tomorrow, with wide expectations that the central bank will keep rates-on hold this month.

    AUD/USD Levels to watch

    The pair finds the immediate resistance at 0.7165 (5-DMA) above which gains could be extended to the next hurdle located at 0.7200 (round number). On the flip side, the immediate support located at 0.7100 (psychological levels). Selling pressure is likely to intensify below the last, dragging the Aussie to 0.7081/78 (Feb 17 & 16 Low).
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