Market News

Chinese PMI Weakness Impacts Australian Dollar: Expert Analysis

Chinese PMI Australian Dollar

In the wake of disappointing Chinese PMI figures, the Australian dollar (AUD) faces downward pressure against the US dollar (USD). This decline follows a slowdown in Chinese factory activity, affecting various commodities, including soft commodities, precious and base metals. Australia, a significant trading partner with China, is experiencing the negative repercussions of this economic slowdown.

Chinese PMI Impacts Australian Dollar – Expert Analysis

Chinese PMI’s drop below the 50 mark, indicating contraction, has led to concerns in the market. Despite missing forecasts, there is hope that efforts by the Chinese government to stimulate the economy might bring positive changes in the future. The Reserve Bank of Australia’s (RBA) Assistant Governor, Brad Jones, expressed uncertainty around interest rates due to factors such as war, global trade disruptions, cyberattacks, and climate change, which could increase rate volatility.

On a positive note for AUD, the housing credit Month-on-Month (MoM) figure reached yearly highs at 0.4%. However, sticky inflation keeps the RBA rate decision on November 7th leaning towards a 25 basis points rate hike.

Investor attention turns to the US CB consumer confidence print and labor cost data. These indicators are crucial in gauging the health of the US economy. Additionally, anticipation builds for Friday’s Non-Farm Payroll (NFP) report, likely impacting currency markets significantly.

Technical Analysis: AUD/USD Price Trends

In the technical analysis, daily AUD/USD price action faces resistance around the longer-term trendline zone. Bulls are eyeing a confirmation close above this zone and the 50-day moving average to capitalize on a potential reversal.

Conversely, a descending triangle pattern with support at 0.6272 is developing, suggesting a bearish trend if prices decline further.

Key Resistance Levels:

0.6500

0.6459

50-day moving average

Trendline resistance at 0.6358

Key Support Levels:

0.6272

0.6170

Retail Trader Sentiment: Bullish Outlook for AUD/USD

Retail traders are currently net LONG on AUD/USD, with 73% holding long positions according to IG Client Sentiment (IGCS) data. This bullish sentiment among retail traders indicates a positive outlook despite the current challenges faced by the Australian dollar in the forex market.

As events unfold, market participants keenly await developments in the Chinese economy and upcoming US economic data, which will play pivotal roles in shaping the future trajectory of AUD/USD exchange rates.

Stay Updated with the Latest Market News. Visit our YouTube Channel for the Latest Forex Analysis.

Leave a comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Our Newsletter

Subscribe to ForexPropNews Trading Newsletters

Receive the best-curated content by our editors for the week ahead.

Mini Charts

Fidelcrest video review

Play Video

Related Articles

Dow and Nasdaq Near Peaks, Hang Seng Rally Strong

Global markets show Dow Jones and Nasdaq 100 nearing record highs, while...

Gold Bulls Stifled by Resistance as Focus Shifts to US PCE

Gold prices retreated on Monday, pressured by rising U.S. Treasury yields, with...

Crypto Stock Surge as Market Hits New Highs

Bitcoin and Ethereum surge to $57k and $3,275 respectively, driven by strong...

USD/CAD: H1 Support is in Play

USD/CAD -Technical Analysis- H4 Chart The chart shows that the price made...

Featured educational content

EXPLORE MORE

Featured educational content

New to Forex? Learn to Read Charts Like a Pro

Dive into forex trading basics: chart reading, candlesticks, technical indicators, timeframes, currency pairs. Start your journey to trading success today!

Video: How I Re-Programmed My Mind to be a Consistent Trader (Thanks to The Wolf of Wall Street)

How I Re-Programmed My Mind to be a Killer Trader (Thanks to The Wolf of Wall Street)

Video: This Invisible Trading Indicator Tells you What Day Trade (Not Just Price)

This Invisible Trading Indicator Tells you WHEN to Trade (Not Just Where)

Technical Analysis: Chart Patterns and Indicators for Profitable Investments

Navigate stocks with confidence using chart patterns like Head and Shoulders, indicators such as MACD, and tools like trendlines. Master technical analysis for...

Latest News

Dow Nasdaq Hang Seng
Market News

Dow and Nasdaq Near Peaks, Hang Seng Rally Strong

Global markets show Dow Jones and Nasdaq 100 nearing record highs, while Hang Seng Index rallies above 100-day SMA.

Gold US PCE
Market News

Gold Bulls Stifled by Resistance as Focus Shifts to US PCE

Gold prices retreated on Monday, pressured by rising U.S. Treasury yields, with investors eyeing the upcoming US PCE data release.

Copyright © 2023 Forex Prop News. All Rights Reserved.