AUD: External background prevents recovery of Australian Dollar

The Australian Dollar rate continues its efforts to recover at the Forex currency market on Thursday; however aggravation of the external background, which is still preserved due to the events in the Middle East, does not promote active purchase.

Forex recommendations: MACD indicator is in the positive area for the pair AUD/USD and it goes down slowly, continuing to give a pair sell signal. Stochastic Oscillator is moving towards oversold zone and is also giving a pair sell signal.

Forex recommendations: if external background changes for the worse, the pair will go to 1.0020 and 0.9980. If the situation remains stable the pair will continue to consolidate close to the current levels.

It became known today that level of capital investment in private sector of Australia increased by 1.3% on quarterly basis in QIV last year, reaching the level of A$29.691 billion. Thus, in accordance with the forecast, total index of capital expenditures will be at the level of A$128.93 billion in 2010-2011.

The data released earlier showed that the level of business confidence NAB in Australia declined by 5 points in QIV against the level of 9 points earlier. However the pressure from external background is getting stronger and the currency is being sold, due to investors’ withdrawal from risks.

No important publications are expected this week; therefore, external background will become the main activator for the pair. Situation in the Australian economy remains unchanged. The AUD is still afloat due to the overall optimism.

Earlier the head of the Reserve Bank of Australia Glenn Stevens noted that he expected stabilization of the national economy, due to which, interest rate would remain unchanged for some time. He also said that economic growth of the Australian economy could be better, than the forecast, despite negative impact of the natural disaster that befell on the country at the beginning of the year.  At the same time Stevens believes in the support from strong economies of India, China, the USA, and risks – from the European economies.

In general, medium term trend for the currency seems downward.

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