Monday, November 2, 2015

AUD/USD: minor recovery of the Chinese bearish gap

FXStreet (Guatemala) - AUD/USD has opened the week lower and starts to recover from a bearish gap offered on the back of Chinese data after US closing highs of 0.7137.

The major commodity currency is supported in early Asia on the 20 hourly SMA at 0.7114 ahead of the RBA interest rate decision this week (expected to hold) and key Nonfarm Payrolls from the US.

Chinese Manufacturing PMI's for October came in below they key 50 mark and missed expectations by 0.2 at 49.8, matching previous of 49.8 while services actual arrived 53.1 and came in below previous of 53.4. This data supports the view that China may need to add further stimulus and scars Australia's economy which contributes to the RBA's fears of external headwinds, ultimately weighing on Aussie dollar.

AUD/USD levels

Technically, 0.7100 is a pivotal point while 0.7050/80 area of support is guards the downside to 0.7000. The September lows are located at 0.6940 ahead of 0.6900. To the upside, the 0.7385 Fibo retracement level needs to be broken in order alleviate downside pressures. Near term upside levels target 0.7162, 0.7190 200 SMA and 0.7211.
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