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Aussie Follows Rebound In Commodities

Reversing the hefty losses witnessed over the past couple of sessions, metals rallied back as gold bullion climbed higher by 1 percent and copper fought back to the tune of 5 percent.  The positive vibe set by the two benchmarks has boosted other metal contracts and has lent strength to an otherwise down Aussie.  This coupled with early session bloc buying hit stops above the 0.7400 figure, boosting the major pair higher.  However, with <?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />US data mixed, the currency has pulled back slightly, still residing as one of the top market movers on the session.  Fed manufacturing data came in strong making a good case for the dollar after preceding initial jobless claims fell.  However, with a significantly lower TIC data report and a decline in overall production, traders lost confidence in greenback longs positions and pared back initiatives slightly heading into the Asian session.  The major buying bid several crosses higher with AUDJPY breaking above the 85.00 figure, as stops were additionally triggered to the upside.

Technically Speaking

After a slight retracement erased its modest intraday gains, the AUDUSD bounced off of yesterdays close to finish near previous support at the 50.0 fibo of its 0.7014-0.7791 run. Given that it crashed through the fibo at 0.7400 on Tuesday and unsuccessfully tested it yesterday, it will be important to note whether price can sustain above the key level. Standing in its way of further gains are the 200-day SMA at 0.7425 and the 100-day SMA at .7450. Thus in the likely case that it fails to break above these important indicators, the pair could instead move towards the 61.8 fibo of the aforementioned uptrend at 0.7314.

AUDNZD

Positive Kiwi Data Overshadowed

The Kiwi dollar leg of the cross could not be helped by a 17-month high in manufacturing as per the ANZ PMI report this morning with US data overshadowing reports on the major.  According to the measure, manufacturing improved in the region, printing a comparably higher than expected figure for the month.  The mornings reports and countering US sentiment couldnt compare to higher metal prices that boosted the Australian dollar as a rumored US based investment house was seen bidding the cross up heavily, placing unwanted pressure on the Kiwi leg.  Looking ahead, with no releases tomorrow, it is seemingly feasible to see some paring back as both economies are absent of any real market moving data.  Not to mention that commodity trading is likely to influence the pair as has been the case over the past couple of weeks.

Rumormill

After a modest drop in yesterdays trading, the AUDNZD posted a 70-pip gain to finish slightly below its 20-day SMA. Mondays gain saw a very similar move, but a sharp downturn at exactly the level of the moving average proved that it would not easily make it through this resistance. As a result, we will have to wait and see whether it can stay above the 1.1910 level to predict its direction in the coming days. Its nearest support can be found in two-week intraday low range of 1.1760-1.1785, while heady resistance awaits at the same periods intraday highs of 1.1970-1.1990.    

AUDCAD

Gold Over Oil, Cross Moves Higher

Although the Canadian dollar gained on the session, weakness could be seen when riding against the Aussie as the AUDCAD cross rounded out our top three market movers of the day.  Sparking some strength by the Canadian single currency early on were comments by Fed Chairman Bernanke that spoke about Chinese demand in the near term as likely to increase.  The comments rippled jitters throughout the commodities markets as traders bid metals and crude higher following weekly losses up to the most recent session.  Subsequently, Canadian real money selling placed some rumored weight on the pair driving it lower to 1.1130.  As we head into the Asian session, Aussie biased trades are still plentiful, but may be subject to some technical levels in the overnight.  With no releases tomorrow, the cross could be in for a tepid Friday afternoon range.

Technically Speaking

The AUDCAD continued to recover from Tuesdays fresh four-year lows to move 50 pips higher on the day. Its month-long skid found a short-term bottom when it stayed above the 78.6 fibo of its 2001-2004 uptrend at approximately 0.8150. Despite this, there is little on the technical charts to suggest that this recovery is likely to continue. Currently below the 10-day SMA, the AUDCAD would likely need to at least break above Mondays intraday high of 0.8279 to avoid retesting its recent lows at 0.8142.