According to Thursday’s verdict, the Australian dollar has taken a massive u-turn against its major peers irrespective of the poor performance during the verdict. Australian dollar faced huge losses in 2016 and 2017 as federal government mid-year economic and fiscal outlook couldn’t quite dispel fears of a rating downgrade despite all three major rating agencies confirming country’s triple-A rating for that period.
Because of the recent profits, the market has finally found some life in trading which was eluded in the past several years.
Forex Trading Signals: December’s Caixin PMI readings showed how small and mid-sized businesses in China have beaten expectations reaching a four-month high. The Caixin manufacturing purchasing managers index in December came to be around 51.5. Economists polled and expected the PMI to be around 50.6 in December and 50.8 in November.
China’s service index clocked around 53.9 from 51.9 in November. This was the fastest expansion since August 2014. Before that, the composite index clocked around 53.0 which was the fastest and best outcome since November 2016. With China being the largest trader for Australia economic news flowed as there was a sudden boost in the Australian dollar. RBA(Reserve Bank of Australia) seems to be in no rush to raise rates as there is a 70% chance that one could be with us by the end of 2018.
According to the graphical survey, the AUD/USD continues to find some life after getting down on December 8. This pair seems to be supported by a near-term rising trend line which is yet to be broken. A continued push puts 61.8% Fibonacci retracement at 0.7887 followed by 76.4% at 0.7978. If the Aussie dollar turns lower falls below near-term rising trend then it may affect the 38.2% Fibonacci retracement at 0.7739 lowering to 23.6% Fibonacci retracement at 0.7648.