Friday’s trade saw AUD/USD within the range of 0.7212-0.7249. The pair closed at 0.7223, inching down 0.07% on a daily basis. It has been the 13th drop in the past 22 trading days and also a third consecutive one. In weekly terms, AUD/USD lost 0.62% of its value during the current week. It has been the 11th drop in the past 20 weeks and also a fifth consecutive one. AUD/USD has gone down 5.00% so far during the current month, following a 0.72% slump in April.
On Monday (May 23rd) AUD/USD trading may be influenced by the following macroeconomic reports and other events as listed below.
Fundamentals
United States
Manufacturing PMI by Markit – preliminary reading
Manufacturing activity in the United States probably was little changed in May, with the corresponding preliminary Purchasing Managers’ Index coming in at a reading of 51.0, according to market expectations, up from a final seasonally adjusted reading of 50.8 in April. The latter has been the lowest PMI level in more than 3 years.
Values above the key level of 50.0 indicate predominant optimism (expanding activity) among survey respondents. In case the flash manufacturing PMI showed a worse-than-anticipated performance in May, this would have a moderate bearish effect on the US dollar. The preliminary PMI reading by Markit Economics is due out at 13:45 GMT.
Fed speakers
At 10:15 GMT on Monday the Fed President for St. Louis, James Bullard, is expected to take a statement, followed by the Fed President for San Francisco and also a FOMC member, John Williams at 12:00 GMT. Additionally, at 22:30 GMT the Federal Reserve President for Philadelphia and also a FOMC member, Patrick Harker is to speak. Their remarks will be closely watched by market players for hints over the Banks monetary policy stance in the upcoming months and, thus, may lead to moderate volatility of the currency pairs containing the US dollar.
Correlation with other Majors
Taking into account the business week ended on May 20th and the daily closing levels of the currency pairs involved, we come to the following conclusions in regard to the strength of relationship:
AUD/USD to NZD/USD (0.9680, or very strong)
AUD/USD to EUR/USD (0.9362, or very strong)
AUD/USD to GBP/USD (-0.7458, or strong)
AUD/USD to USD/CHF (-0.8860, or very strong)
AUD/USD to USD/CAD (-0.9198, or very strong)
AUD/USD to USD/JPY (-0.9271, or very strong)
1. During the examined period AUD/USD moved almost equally in one and the same direction with EUR/USD and NZD/USD. This relationship has been the most pronounced between AUD/USD and NZD/USD.
2. AUD/USD moved strongly in the opposite direction compared to GBP/USD during the week.
3. AUD/USD moved almost equally in the opposite direction compared to USD/CHF, USD/CAD and USD/JPY during the period in question. This relationship has been the most pronounced between AUD/USD and USD/JPY.
Daily and Weekly Pivot Levels
By employing the traditional calculation method, the Monday pivot levels for AUD/USD are presented as follows:
Central Pivot Point – 0.7228
R1 – 0.7244
R2 – 0.7265
R3 – 0.7281
S1 – 0.7207
S2 – 0.7191
S3 – 0.7170
By using the traditional method of calculation again, the weekly pivot levels for AUD/USD are presented as follows:
Central Pivot Point – 0.7256
R1 – 0.7334
R2 – 0.7446
R3 – 0.7524
S1 – 0.7144
S2 – 0.7066
S3 – 0.6954
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