AUD: Sales of Australian Dollar are increasing

At the Forex currency market in the middle of the week sales of the Australian Dollar are increasing; high-risky currency has neither fundamental nor technical basis to seize upon in order to suspend its decline.

Forex forecast: MACD indicator for the pair AUD/USD has merged with the signal line and is not giving a signal, tending to break down. Stochastic Oscillator goes down the neutral zone, giving a sell signal. 

Forex recommendations: in case of breakdown at the level of 1.0200, the pair will go to 1.0180 and 1.0160. If downward breakdown does not take place, the pair will consolidate at the current levels.

Morning statistics did not save the AUD from downfall: consumer confidence Westpac in Australia rose by 8.1% m/m in September, reaching the level of 96.9 points. Statistics released earlier showed that index of business conditions NAB in Australia fell by 3 points in August against the level of -1 point in July. The index declined to the lows since April 2009, indicating slump in the sentiments and prospects. National Australian Bank Ltd, noted commenting this outcome that it reflects increased level of uneasiness and concern that debt crisis will spread further. As long as external background remains negative, the pair will continue to lose positions.

At the meeting last week, the Reserve Bank of Australia decided to leave the cash rate unchanged at 4.75% per annum, as expected. In the follow-up comments the head of the RBA Glen Stevens noted that “medium term economic prospects look worse that it had been expected a few months earlier. Global financial markets demonstrated severe instability”. The situation with the rate seems logical amid such background.  “The RBA Committee decided that the most viable option will be to maintain current course of the monetary policy. At the next meeting the RBA will continue to carefully analyze both the prospects for economic growth and inflation in Australia, –said Stevens. The pause in the policy of monetary tightening, maintained by the RBA, has been already going on for 9 months.

It became known earlier that trade balance in Australia was at the level of +A$1.83 billion in July against the forecast of +A$1.9 billion, which is slightly better than the data in June, however weaker than predicted. Obviously, external background puts pressure on the economy of the Green Continent. Currently, the pair AUD/USD will have downward trend in the medium term.