Yesterday we saw an interesting reversal of the pair AUD/USD.
After a long fall from 0.78 to 0.71 the pair AUD/USD was able to demonstrate a significant increase yesterday.
Yesterday’s increase of the pair AUD/USD doesn’t confirm the reversal, but gives good hope.
In recent weeks, the market was convinced that the Reserve Bank of Australia will make an additional rate cut because the big problems of the country's economy. However, recent reports suggest that the state of the Australian economy is not so bad.
The volume of exports has exceeded expectations, the housing market observed a surge of activity, and building permits rose in April. Investors don’t exclude that the regulator will refrain from any radical steps in the near future. This means that the Aussie is oversold and ready for a correction.
The only risk factor for the pair AUD/USD could be the publication of Non-Farm Payrolls, so some investors advise entering the market on Friday.
The US is to publish data on ISM Manufacturing PMI, forecast 50.4 vs. the previous 50.8. Tomorrow we wait for data on retail sales and trade balance of Australia. The retail sales are expected to decline, 0.3% vs. 0.4%. The trade balance may show a decrease the deficit after the positive data on exports.
How to trade
The upward moving is possible above 0.7292. The downward movement is possible in the range of 0.7248 - 0.7223. We would buy call options if the pair goes above 0.7292. we would buy put options if the pair decreases below 0.7248.
Expiry time: 20:00 GMT