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AUD/USD binary signal - Australia Quarterly Inflation - 26 April 2017

Signal details
Entry Price: 
0.7525
Close Price: 
0.7475
Direction: 
Low
Expiry Time: 
20:00 GMT
Result: 
ITM
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Consumer price index (CPI) rose at a slower than expected pace in the three months ending March, data from statistics agency, Australian Bureau of Statistics showed earlier today. The data was slightly below what economists had forecast which sent the Australian dollar weaker in today's Asian trading session.

Rising just 0.5% on the quarter, the annual inflation rate was registered at 2.1% in the first quarter. Excluding the volatile food and energy components, the underlying inflation or core inflation was seen at 1.8% on the year, while rising 0.45% on the quarter. In terms of policy implications, the Reserve Bank of Australia (RBA) is not expected to make any changes to interest rates which will most likely remain unchanged at the next policy meeting.

Economists were expecting to see inflation rise 0.6% on the quarter. The slow pace of increase came despite higher energy prices. Petrol prices gained 5.7% while electricity prices jumped 2.5%. The gains from oil and energy were offset by a 6.7% decline fresh fruit prices which managed to drag inflation lower. The RBA's meeting is coming up next week on Monday where interest rates are likely to remain unchanged at 1.5%. The 2.1% annual inflation rate sits within the RBA's target band.

The Australian dollar has been trading weaker for the past two weeks as the currency also came under pressure from the weaker iron-ore prices. At the time of writing, AUDUSD was seen falling to a 4-day low at 0.7505 marking a third consecutive day of decline against a rather mixed U.S. dollar. Technical support in AUDUSD is seen at 0.7500 and 0.7465 which has been tested three times so far.

Considering the above factors, the binary options trade signal for today is to purchase daily PUT options in AUDUSD. Wait for AUDUSD to post a short-term rally towards 0.7525 where resistance will be established. Purchase daily PUT options here (0.7525) for a 20:00 GMT expiry time as AUDUSD will be seen extending the declines from the resistance level.

Disclaimer: The article is written for informative purposes only and it is not financial advice. The author does not have any position in the currency pairs mentioned, and no plans to initiate a position. He wrote the article himself and expressed his own opinions. He has no business nor personal relationships with any mentioned government entities or stocks. Readers should not treat any opinion expressed by the author as a specific inducement to make a particular trade or follow a particular strategy, but only as an expression of his opinion.