Analysis and Recommendation: (close of Asian session)

AUD/USD  remained under pressure during the U.S. trading session Tuesday as worries about China's slowing economic growth sparked a selloff. The pair is currently trading at 1.0486 falling from 1.0528

Comments from a BHP Billiton Ltd, executive that China's demand for iron ore is expected to drop to single digits as growth in the world's second largest economy cools hit the currency hard. China imports around 60% of the world's steelmaking material.

In the short term, we are watching U.S. equities for an indication of whether risk appetite can rebound. A close of the S&P above 1,400 should provide a floor in risky assets and a floor in [Australian dollar/U.S. dollar] at 1.0450, at which it can rebound over the days ahead, said Michael Sneyd, a BNP Paribas currency strategist based in London.

The Aussie jumped 20 pips on the RBA minutes, which revealed that the board seemed to lift the pre-conditions for further easing from a relatively broad weakening in demand conditions to a sudden worsening in the situation in Europe and the resultant disruption to capital and trade flows, particularly in Asia, said Adam Cole, global head of foreign exchange strategy at RBC Capital Market, in a note.

Of all the G10 currencies, the Aussie dollar was one of the worst performing for the day

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Economic Events and Reports March 20, 2012 actual v. forecast

Mar. 20

 

AUD

 
 
 

Monetary Policy Meeting Minutes 

 

 
 
 
 
 
 

 

 

CHF

 
 
 

Industrial Production (QoQ) 

7.9%

 

0.4% 

 

-2.0% 

 
 

 

 

GBP

 
 
 

Core CPI (YoY) 

2.4%

 

2.4% 

 

2.6% 

 
 

 

 

GBP

 
 
 

CPI (YoY) 

3.4%

 

3.4% 

 

3.6% 

 
 

 

 

GBP

 
 
 

CBI Industrial Trends Orders 

-8

 

-5 

 

-3 

 
 

 

 

USD

 
 
 

Building Permits 

0.72M

 

0.69M 

 

0.68M 

 
 

 

 

USD

 
 
 

Housing Starts 

0.70M

 

0.70M 

 

0.71M 

 
 

 

 

NZD

 
 
 

Current Account 

-2.76B

 

-2.83B 

 

-4.75B 

 
 

Economic Events Scheduled for March 21, 2012 affecting AUD, NZD and JPY

00:50     JPY        Trade Balance                                                                                                

The Trade Balance measures the difference in value between imported and exported goods and services over the reported period. A positive number indicates that more goods and services were exported than imported.

13:30     USD      Initial Jobless Claims                     

13:30     USD      Continuing Jobless Claims

Initial Jobless Claims measures the number of individuals who filed for unemployment insurance for the first time during the past week. This is the earliest U.S. economic data, but the market impact varies from week to week. Continuing Jobless Claims measures the number of unemployed individuals who qualify for benefits under unemployment insurance.

Government Bond Auctions (this week)

Mar 22  10:10  Sweden  I/L bond auction

Mar 22  10.30  UK  Auctions 0.625% 2042 I/L Gilt

Mar 22  15:00  US

Announces auctions of 2Y Notes on Mar 27, 5Y Notes on Mar

28 & 7Y Notes on Mar 29

AUD/USD Pivot Points (Time Frame: 1 Day)

 

Name S3 S2 S1 Pivot R1 R2 R3

Classic
1.0306
1.0382
1.0433
1.0509
1.0560
1.0636
1.0687

Fibonacci
1.0382
1.0430
1.0460
1.0509
1.0557
1.0587
1.0636

Camarilla
1.0450
1.0462
1.0473
1.0509
1.0497
1.0508
1.0520

Woodie's
-
1.0376
1.0421
1.0503
1.0549
1.0630
-

DeMark's
-
-
1.0534
1.0496
1.0408
-
-