AUD/USD: Daily Technical Analysis For July 4, 2014

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The Australian dollar weakened sharply against all currencies after mixed data and comments from central bank Governor Glenn Stevens that record low interest rates have not full flowed through the economy as the exchange rate remained high. In a speech in Hobart, Stevens said, “In either nominal or real terms, the cash rate is well below ‘normal’ levels, and comfortably below even the mooted lower ‘new normal’ levels.”

“Moreover, we still have ammunition on interest rates – we have not got close to the zero lower bound that has afflicted some other countries,” he added. But he said the exchange rate remains high by historical standards and has affected the economy.”The full effects of the very accommodative stance of policy have not been seen at this stage. It will be supporting demand for some time yet,” Stevens said. This sent the Australian dollar weak


Elsewhere, the U.S dollar firmed after the U.S. Department of Labor reported that Non-Farm Payrolls rose by 288,000 in June, easily surpassing expectations for an increase of 212,000. May’s figure was revised up to a gain of 224,000 from 217,000.

The unemployment rate ticked down to 6.1% from 6.3% in May. Analysts had expected the jobless rate to hold steady at 6.3% last month.


Intra-day bias in the pair remains on the downside with a fresh cross of 21 and 55 Ema’s on the 1 hour and 4 hours time-frame respectively which is signaling a bearish continuation. Also MACD and SSRC stochastic are also showing signs of more supply could be seen.  A break of 0.93212 support could resume further fall to 0.92708

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