USD Trading Outlook (24-11-2014)

AUD/USD initially was a major beneficiary of the PBOC’s actions as it got a major boost off rallies in commodities. NY walked in with AUD/USD near 0.8700. NY made an attempt to clear Europe’s 0.8723 high as the USD was soft and commodities remains firm. The attempt failed and the pair slipped as doubts about the efficacy of the PBOC action crept into the market. The pair hit 0.8700 again as JPY strength drove AUD/JPY from the 102.75 area down below 102.30. AUD/USD tested the 200-HMA and hourly support in the 0.8685/90 area. The pause there was brief though as the USD rebounded from earlier losses vs JPY. AUD/USD slipped further to trade near 0.8665. Little bounce was seen and the pair sat near 0.8670 late in the day. The pair’s inability to mount bigger gains off the PBOC as well as it’s failure to hold above the 10 & 21-DMAs may concern recent longs. Bears appear to be putting up a fight. Aussie Q3 Capex report is due next week. A weak result likely puts added bear pressure on AUD. We might then see a retest of the 0.8540/60 support zone.