AUD/USD for Thursday, December 12, 2013
After showing some resilience over the last few days by moving to a one week high above 0.9150, the AUD/USD has turned around sharply and looks poised to return to the key level at 0.90. After all of its steady good work a few weeks ago in the middle of November which saw the AUD/USD steadily move higher from support at 0.93 back up to a one week high near 0.9450, the AUD/USD has since returned all of those gains and some moving down to the three month low just below 0.90 late last week. After settling around the 0.95 level for over a week earlier last month, the AUD/USD started to drift lower back towards the support at 0.93. Throughout most of October the AUD/USD enjoyed a solid and steady move higher from the support level at 0.93 up to the resistance level at 0.95 and beyond to a high around 0.9760.
Throughout the first half of September the AUD/USD enjoyed a solid run which was punctuated by a strong surge higher sending it to a then three month high just above 0.95. A couple of months ago the AUD/USD had been trying valiantly to stay above the support level at 0.89 as all week it placed downward pressure but was unable to sustain any break lower. At the beginning of August it moved very well from three year lows to move back above the key level of 90 cents and beyond to a two week high just above 0.92 to finish out that week. At the end of July the AUD/USD fell very strongly and appeared to resume the medium term down trend as it moved to a new three year low near 0.8850 but it reversed very well and looked poised to continue back towards the longer term resistance level at 0.93. For the most part of the last week, it moved very little and was quite subdued staying above the support level at 0.94.
Throughout July the AUD/USD placed constant pressure on the 0.93 level again as it continued to place buying pressure on that level however the resistance there was able to stand firm. It was during this time it did very well to maintain its price level well above 0.92 as place upward buying pressure on the resistance level at 0.93. Throughout July, the AUD/USD spent most of its time trading between 0.90 and 0.93 threatening to break through either level at multiple stages. The 0.9150 level also became a key level during that time providing both some resistance and more recently support, and this was called upon again a few weeks ago providing some much needed support however it was completely ignored a couple of weeks ago as the AUD/USD fell heavily through it. Considering the speed of its decline throughout several months this year, the second half of this year has seen a significant slowing down and almost some consolidation as it has rested well on the support at 0.90 several times. Throughout April to August, the AUD/USD established a strong medium term down trend with lower peaks and lower troughs, as it has moved from near 1.06 down to near 0.90 in that time.
On Wednesday, Consumer sentiment fell by 4.8 percent to 105.0 points in December, from 110.3 in November, according to the Westpac Melbourne Institute Index of Consumer Sentiment. It was the lowest level of the index since July, Westpac chief economist Bill Evans said. "It appears that the boost in confidence partly associated with the election result and booming house prices has faded in December," Mr Evans said. "In particular, confidence around the economic outlook has faltered." Confidence around the labour market wasn't much better, Mr Evans said, with a 4.6 percent increase in consumers expecting unemployment to rise. "It is likely that news on job losses in high profile companies such as Qantas and Holden may have unnerved respondents while media coverage of rising fixed mortgage rates may also have been a factor in the sharp swing in assessments of interest rate news from favourable to unfavourable," Mr Evans said.