7 Apr 2015
Stay long AUD/USD, target 0.7900 – Growth Aces
FXStreet (Barcelona) - The Growth Aces Research Team expects Australian economy to stage a recovery which would lead RBA to keep rates on hold for the rest of year, hence suggests going long on AUD/USD, targeting 0.7900 levels.
Key Quotes
“Australia's central bank kept interest rates steady for a second month today against market expectations for a cut, but in line with our forecast. The Reserve Bank of Australia Governor Glenn Stevens said: “Further easing of policy may be appropriate over the period ahead. The Board will continue to assess the case for such action at forthcoming meetings”.”
“However, our baseline scenario is that the RBA will not change rates this year, as there are a lot of promising signs of economic recovery.”
“The Australian Bureau of Statistics said retail sales rose 0.7% in February, well ahead of forecasts of a 0.4% increase, while January was revised up. Industry figures showed sales of new vehicles in both March and February were the strongest on record for those two months. Sales for March alone were 8% higher yoy.”
“Low rates are also stoking investor demand for housing in Sydney, with prices up over 13% yoy, according to figures from property consultant RP Data.”
“The AUD jumped above 0.7700 after the Reserve Bank of Australia left interest rates on hold, prompting a wave of short-covering. We stay AUD/USD long.”
“However, there are some important resistance levels in this area: 21-dma at 0.7701 and 10-dma at 0.7729.”
“AUD/USD investors will focus now on Wednesday’s U.S. FOMC minutes.”
“Resistance: 0.7701 (21-dma), 0.7710 (hourly high, Apr 7), 0.7729 (10-dma)”
“Support: 0.7571 (low Apr 3), 0.7534 (low Apr 2), 0.7451 (low May 18, 2009)”
“AUD/USD: long at 0.7565, target 0.7930, stop-loss moved to 0.7640, risk factor ***”
Key Quotes
“Australia's central bank kept interest rates steady for a second month today against market expectations for a cut, but in line with our forecast. The Reserve Bank of Australia Governor Glenn Stevens said: “Further easing of policy may be appropriate over the period ahead. The Board will continue to assess the case for such action at forthcoming meetings”.”
“However, our baseline scenario is that the RBA will not change rates this year, as there are a lot of promising signs of economic recovery.”
“The Australian Bureau of Statistics said retail sales rose 0.7% in February, well ahead of forecasts of a 0.4% increase, while January was revised up. Industry figures showed sales of new vehicles in both March and February were the strongest on record for those two months. Sales for March alone were 8% higher yoy.”
“Low rates are also stoking investor demand for housing in Sydney, with prices up over 13% yoy, according to figures from property consultant RP Data.”
“The AUD jumped above 0.7700 after the Reserve Bank of Australia left interest rates on hold, prompting a wave of short-covering. We stay AUD/USD long.”
“However, there are some important resistance levels in this area: 21-dma at 0.7701 and 10-dma at 0.7729.”
“AUD/USD investors will focus now on Wednesday’s U.S. FOMC minutes.”
“Resistance: 0.7701 (21-dma), 0.7710 (hourly high, Apr 7), 0.7729 (10-dma)”
“Support: 0.7571 (low Apr 3), 0.7534 (low Apr 2), 0.7451 (low May 18, 2009)”
“AUD/USD: long at 0.7565, target 0.7930, stop-loss moved to 0.7640, risk factor ***”