AUDUSD downtrend continues
Gary Christie November 2, 2020 4:38 PM
A bearish trend channel remains despite strong day for the AUD.
The US Dollar was bullish against most of its major pairs on Monday with the exception of the NZD, AUD and CAD. On the US economic data front, Markit's US Manufacturing Purchasing Managers' Index slightly rose to 53.4 on month in the October final reading (53.3 expected), from 53.3 in the October preliminary reading. Finally, Construction Spending increased 0.3% on month in September (+1.0% expected), compared to +1.4% in August.
On Tuesday, Factory Orders for September are expected to rise 1.0% on month, compared to +0.7% in August. Finally, Durable Goods Orders for the September final reading are anticipated to increase 1.9% on month, in line with the September preliminary reading.
The Euro was bearish against most of its major pairs with the exception of the CHF and GBP. In Europe, Research firm Markit has published final readings of October Manufacturing PMI for the Eurozone at 54.8 (vs 54.4 expected), for Germany at 58.2 (vs 58.0 expected), for France at 51.3 (vs 51.0 expected) and for the U.K. at 53.7 (vs 53.3 expected).
The Australian dollar was bullish against most of its major pairs with the exception of the CAD. Looking at the daily chart of the AUD/USD the pair continues to trade inside a bearish trend channel. The 20-day moving average remains below the 50-day moving average, also a bearish signal. We anticipate a further decline down to test 0.692 support and possibly 0.676 in extension. A break above 0.7155 would be a strong bullish signal and a possible sign of a trend reversal to the upside.
Source: GAIN Capital, TradingView
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