Morning Dealing Room Technical Report

August 11, 2015

Market Comment

Australia

The S&P/ASX 200 index gained 0.63% or 34.377pts to 5509.16 (day range: 5513 – 5458.2) on Monday. The index is below its 20d MA (@ 5627) and below its 50d MA (@ 5580). 38% of the index constituents are above their 20D MA (vs 33% the previous session) and 43% of the shares are above their 50D MA (vs 40%).Australia’s foreign reserves amounted to A$68.9B in July vs A$676.3B in June, according to the Reserve Bank of Australia.

Foreign Exchange

The US dollar was mixed against its major counterparts on Monday. There was no major economic news reported in the U.S. on Monday.

The Euro was mixed against its major pairs. In Europe, euro zone Sentix investor confidence index fell to 18.4 in August from 18.5 in July. It was expected to be 20.3.

The Australian dollar was under pressure against all of its major counterparts.

Last %1D %YTD
EUR/USD 1,1017 0.46 -8.94
GBP/USD 1,5588 0.63 0.07
USD/JPY 124,56 0.26 4.07
EUR/CHF 1,0837 0.44 -9.80
EUR/JPY 137,2300 0.74 -5.14
EUR/GBP 0,7068 -0.15 -9.00
AUD/NZD 1,1206 0.04 6.93
AUD/JPY 92,2820 0.12 -5.60
EUR/AUD 1,4870 0.57 0.42
USD/CAD 1,3009 -0.95 11.94
USD/CHF 0,9836 -0.02 -1.08
AUD/USD 0,7409 -0.12 -9.37
NZD/USD 0,6611 -0.17 -15.21

Currency Updates:

Medium Term Strategy: Forex Pair of the day

AUD/USD – under pressure
The pair stands below the strong resistance at 0.7805. In addition, the 20 and 50-days moving averages crossed downward and the RSI stands below its neutrality area. As a consequence, further weakness is expected with a first target at 0.7255 (horizontal support and previous overlap) and a second one set at 0.6980 (horizontal support). A third target is set at 0.6865. Only a break above the strong horizontal resistance at 0.7805 would turn the outlook to bullish and favour a recovery towards 0.8165 (May top) at first and towards January top at 0.83 in extension.

Intraday Technical Strategy

AUD/USD Intraday: further upside.
Pivot 0.7380
Our preference Long positions above 0.738 with targets @ 0.743 & 0.745 in extension.
Alternative scenario Below 0.738 look for further downside with 0.735 & 0.7315 as targets.
Comment The RSI is well directed.

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