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Thomson Reuters
Apr 18 - 02:36 PM
AUD/USD - COMMENT-Data Puts AUD/USD's Bottoming Process On A Longer Path
First appeared on eFXplus on Apr 18 - 12:45 PM

AUD/USD's recent attempts to reclaim its 200-DMA boosted bulls' hopes that a long-term bottom was forming, but today's U.S. data nL1N21Z0OU suggests that may be a premature assumption nL1N2200GD.
Indeed, the upbeat data suggests the U.S. economy remains robust.
Eurodollar and fed funds futures prices reacted negatively and now suggest lowered odds for Fed rate cuts.
As a result, AUD/USD reversed below its 10-DMA and the daily RSI turned down giving short-term techs a bearish tilt.
That said, a sustained AUD/USD drop appears unlikely given solid Australian March employment results nL3N2200K4, which have likely further confounded the RBA's view on the economy.
While Australian 3-month bank bills rates still suggest an RBA cut is due, odds have not increased after the jobs data.
Thus, investors will likely continue to ponder future rate paths for both the Fed and the RBA, which could serve to hamstring AUD/USD price action until new risk factors emerge.
One of those risks could be the April 23 release of Q1 Australian inflation data.
Forecasts call for inflation to deteriorate from Q4's result, so an upside surprise could trigger a run through 0.7205/10, targeting the January and December highs.

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