FBS: bullish on AUD/USD
Australian dollar recovers ground after being thrown down at the end of the previous week. Strong China’s manufacturing PMI released today is an important source of support for the Aussie. Improvement in the Chinese dataflow revives hopes that demand on Australian commodities will remain sufficient. As a result, market expectations of RBA rate cuts are becoming lower. US will release manufacturing PMI today at 13:00 GMT.
In the medium term we remain bullish on the Aussie. It is now a good chance to buy AUD/USD on a break above $0.9460 with a target of $0.9500 and a stop at $0.9410. The recent CFTC report confirms the prospects for a higher recovery, showing the market keeps covering Aussie shorts. The $0.9500/30 area could cap the upside or at least to provoke another consolidation below as there is a lot of sell orders clustered there. We will remain bullish as long as the $0.9225 level holds.
Chart. H4 AUD/USD