Daily Report: Major Pairs at Key Levels

Dollar's rally is still being held by key levels in against some major currencies. GBP/USD recovers after hitting 1.83 level, AUD/USD is drawing support from 0.85. USD/CHF is still struggling around 1.1. Momentum in EUR/USD is not convincing too. Dollar is struggling to find follow through buying with oil still held inside range of 112 and 118 level and will probably need a break out there to give clear direction. On the other hand, note that focus in the major pairs will remain on near term levels mentioned in out technical outlook reports and as long as these levels holds, there is still no change in dollar's near term bullish outlook yet.

On the data front, Germany import price showed 0.6% mom, 9.3% yoy gains in Jul. Prelim CPI is expected to drop -0.2% mom in Aug, with yoy rate moderated slightly from 3.3% to 3.2%. Durable goods orders in US will be the main focus and is expected to be flat in Jul, with ex transport orders dropping -0.5%.

FOMC minutes released overnight didn't revealed much new information. Members generally agree that the economy will remain weak and are generally concerned the possibility that core inflation will moderate as growth slows. The next move from Fed is still likely a hike but the opinion on the timing is rather divided.

AUD/USD Daily Outlook

Daily Pivots: (S1) 0.8485; (P) 0.8565; (R1) 0.8638; More

AUD/USD recovers mildly after meeting mentioned 0.8512 cluster support target. At this moment, intraday bias remains on the downside as long as 0.8689 minor resistance holds. Sustained break of 0.8512 cluster support will bring deeper decline to test long term trend line support and 0.80/81 level. On the upside, though, above 0.8689 will turn intraday outlook neutral first. Further break of 0.8812 resistance will confirm that a short term bottom is finally in place with bullish convergence condition in 4 hours MACD and RSI. Stronger rebound should then be seen in such case.

In the bigger picture, AUD/USD has completed a diagonal triangle pattern that started at 0.7675, with 0.9849 as a false break with bearish divergence conditions in daily and weekly MACD and RSI. Break of 55 weeks EMA reaffirmed that 0.9849 is an important top. Fall from 0.9849 has now dived into medium term support zone of 0.7675 and 0.8870, with 0.8008 key medium term support in between as expected. Firm break of 0.8512 cluster support (61.8% retracement of 0.7675 to 0.9849 at 0.8505) will put long term trend line support (0.4773 (01 low), 0.7015, now at 0.8105) into focus.

Forex News Digest

• The Day Ahead Canada and U.S.: U.S. Durable Goods, DOE Inventories
• The Day Ahead Europe and U.K.: German Import Prices and Regional CPI
• Tuesday's News Recap: US Consumer Confidence, Housing Data Upbeat; FOMC Minutes
• Meeting Minutes Say FOMC's Stance Remains Neutral
• FOMC Minutes Indicate Neutral Bias and Put Spotlight on Dissent, Economists Say
• Dollar Falls on Speculation U.S. Durable Goods Orders Stalled Last Month
• Australian, New Zealand Dollars Advance as Investors Boost Carry Trades
• U.S. Durable Goods Orders Probably Stalled as Business Investment Slowed
• Euro, Pound Likely to Decline as Recession Looms, Wall Street Journal Says

More Forex News

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