USD Trading Outlook (05-12-2014)

AUD/USD After giving up all the retail sales inspired gains Europe lifted the pair off the day’s 0.8356 low. Profit taking had the pair near 0.8375 as NY got going. Early NY saw the lift gather pace as the USD went broadly offered on USD/JPY’s drop from the 119.95 area. AUD/USD near 0.8400 but made a quick spike down near 0.8360 on a combination of EUR/AUD’s lift from below 1.4660 towards 1.4780 and USD/JPY’s rebound. AUD/USD’s dip was bought though as the USD couldn’t manage a serious rally. AUD/USD rallied and hit 0.8421. The USD clawed back some losses in NY’s afternoon and this saw the pair slip lower and sit just above 0.8380 late in the day. Action in Asia is likely to be subdued as the market awaits the US jobs figures but the Oz Nov AiG PCI is due. A weak result may see AUD get hit as it will bolster the view that the Oz econ is struggling a bit. Bears are looking at 0.8315 as key s-t support for now.