- 1 AUD/USD – Technical Analysis for Forex Trading Australia
AUD/USD – Technical Analysis for Forex Trading Australia
United States – Institute for Supply Management (ISM) Manufacturing PMI
Today, at GMT 3:00 p.m., the Institute for Supply Management will release its manufacturing PMI figure for the United States. The ISM’s US manufacturing PMI measures the level of a diffusion index based on a survey of 400 purchasing managers.
Purchasing managers in the United States are involved in the supply side of the economy. As most companies reduce their expenses and production based on their sales forecast, the survey of purchasing managers reveals the overall optimism of various companies in the country. Hence, Forex investors can easily figure out the sentiment regarding the economic condition in the country from the ISM manufacturing PMI readings.
Last month, the ISM manufacturing PMI for the United States came out at 57.2 and the forecast for this month is currently set at 56.6.
Australia – Cash Rate
Tomorrow, at GMT 5:30 a.m., the Reserve Bank of Australia (RBA) released the official cash rate, which is the interest rate that major Australian banks and financial institutions pay to borrow funds held at the RBA.
Since short-term interest rates are the primary factor in the valuation of the Australian Dollar against other major currencies, Forex traders pay close attention to any changes in the official cash rate.
The RBA left the cash rate at 1.5% in their last meeting and the forecast for this month is that the RBA will leave the cash rate unchanged at 1.5% for the time being.
After breaking below the uptrend line on April 3, the AUD/USD price went down by around 150 pips over the last month. However, as soon as the AUD/USD reached near the 0.7450 level, it found a strong support last week and formed a bullish pin bar on April 27. Earlier today, the high of this pin bar was penetrated and currently, the AUD/USD is testing the resistance near the 0.7535.
As the Australian cash rate is expected to remain unchanged at 1.5%, but the US ISM manufacturing PMI is expected to come slightly lower, at 56.6, compared to last month’s 57.2 reading, we believe it would likely set a bullish fundamental outlook for the AUD/USD.
Under the circumstances, if the AUD/USD price penetrates and closes above the 0.7535 level, it would likely attract additional bullish momentum in the market. Hence, Forex trading Australia investors should look out for trading opportunities above this major resistance level around 0.7535.
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