{"id":6230,"date":"2010-01-26T09:51:15","date_gmt":"2010-01-26T14:51:15","guid":{"rendered":"http:\/\/countingpips.com\/fx\/?p=6230"},"modified":"2010-01-26T09:51:15","modified_gmt":"2010-01-26T14:51:15","slug":"audusd-drops-below-90-level-on-china-news","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2010\/01\/26\/audusd-drops-below-90-level-on-china-news\/","title":{"rendered":"AUD\/USD Drops Below .90 Level on China News"},"content":{"rendered":"

By Fast Brokers<\/strong> – The AUD\/USD has dropped well below its psychological .90 level and is setting new January lows as the Dollar strengthens across the board.\u00a0 The Aussie\u2019s selloff was triggered by news that China\u2019s major banks are tightening their lending practices in light of the central bank\u2019s hawkish monetary stance in an effort to combat inflation and the formation of asset bubbles.\u00a0 Tighter liquidity in China indicates the government is trying to cool down its economy, a particularly negative development for the Aussie since Australia\u2019s strong economic performance has been fueled by China\u2019s demand for commodities such as crude and iron ore.\u00a0 Furthermore, investors should consider that Australia just printed a weaker than expected PPI figure and this may dissuade Australia\u2019s central bank from raising rates at its next policy meeting despite the improvement in employment and domestic consumption.\u00a0 That being said, Australia\u2019s CPI release during tomorrow\u2019s Asia trading session could carry some additional weight.\u00a0 A weaker than expected CPI figure could place further downward pressure on the AUD\/USD while a hot CPI could help buoy the currency pair.\u00a0 Additionally, the U.S. will release CB Consumer Confidence today followed by New Home Sales and the Fed\u2019s monetary policy decision tomorrow.\u00a0 Hence, volatility in the Greenback could remain at a heightened state for the next couple trading sessions.<\/p>\n

Technically speaking, the AUD\/USD is currently approaching our key 1st and 2nd tier uptrend lines.\u00a0 These trend lines could serve as the last line of defense for the currency pair over the near term since they run through December \u201909 lows, or the .8730 level.\u00a0 As for the topside, the AUD\/USD faces multiple downtrend lines along with 12\/16 and 1\/25 highs.\u00a0 Furthermore, the psychological .90 level may serve as a technical barrier now.<\/p>\n

Price: .8962<\/p>\n

Resistances:\u00a0 .8972, .8994, .9006, .9022, .9044, .9060<\/p>\n

Supports: .8950, .8931, .8919, .8904, .8881, .8867<\/p>\n

Psychological: .90, December lows and January highs<\/p>\n

(click to enlarge)<\/p>\n

\"\"<\/a><\/p>\n

Market Commentary<\/strong><\/em> provided by Fast Brokers<\/strong>.<\/a><\/p>\n

Disclaimer:<\/strong> FastBrokers\u2019 market commentary is provided for information purposes only and under no circumstances should be regardedneither as an investment advice nor as a solicitation or an offer to sell\/buy any financial product. FastBrokers assumes no responsibility or liability from gains or losses incurred by the information herein contained.<\/p>\n

Risk Disclosure:<\/strong> There is a substantial risk of loss in trading futures and foreign exchange. Please carefully review all risk disclosure documents before opening an account as these financial instruments are not appropriate for all investors.<\/p>\n","protected":false},"excerpt":{"rendered":"

By Fast Brokers – The AUD\/USD has dropped well below its psychological .90 level and is setting new January lows as the Dollar strengthens across the board.\u00a0 The Aussie\u2019s selloff was triggered by news that China\u2019s major banks are tightening their lending practices in light of the central bank\u2019s hawkish monetary stance in an effort … <\/p>\n

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