Forex Market: AUD/USD daily forecast

During yesterday’s trading session AUD/USD traded within the range of 0.9327-0.9393 and closed at 0.9356.

At 8:35 GMT AUD/USD traded at 0.9350, losing 0.06% for the day. The pair touched a daily low at 0.9335 at 7:25 GMT.

Fundamental view

The monthly survey by Thomson Reuters and the University of Michigan may show that the preliminary reading of the US consumer confidence improved to 84.5 in May from a final reading of 84.1 in the previous month. The survey encompasses about 500 respondents throughout the country. The index is comprised by two major components, a gauge of current conditions and a gauge of expectations. The current conditions index is based on the answers to two standard questions, while the index of expectations is based on three standard questions. All five questions have an equal weight in determining the value of the overall index.

In case the gauge of consumer sentiment showed a larger improvement than projected, this would boost demand for the dollar. The official reading is due out at 13:55 GMT.

Building permits probably increased to an annualized pace of 1.015 million units last month from 0.990 million in March. Housing statistics are calculated based on issued building permits, including those of local authorities. Not all regions of the country require building permits. The statistics reflects only those in which it is required. Ongoing studies related to construction only cover the percentage of work undertaken on the basis of permits. The majority of the data for the reporting period is not available at the time of publication and therefore does not provide statistical data for actually started construction works for the observed period.

The US Department of Commerce is expected to release its official data at 12:30 GMT today. Higher-than-expected readings can be seen as signs of improving housing market conditions and will certainly provide support for the greenback.

Housing starts in the US probably rose to an annualized pace of 0.985 million units in April from 0.946 million units in the previous month, according to the median estimate of experts. As a start of construction is considered the beginning of construction works, excavation or development of the foundations of the building. The construction of houses, is considered to be initiated at the beginning of the excavation. The index started in 1992 and covers the whole territory of the country, regardless whether construction permits are needed.

Technical view

According to Binary Tribune’s daily analysis, in case AUD/USD manages to breach the first resistance level at 0.9390, it will probably continue up to test 0.9425. In case the second key resistance is broken, the pair will probably attempt to advance to 0.9456.

If AUD/USD manages to breach the first key support at 0.9324, it will probably continue to slide and test 0.9293. With this second key support broken, the movement to the downside will probably continue to 0.9258.