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AUD/USD extends the drop to 0.7050

The Aussie dollar is now rapidly losing the grip vs. the greenback, pushing AUD/USD to the 0.7060/50 band, or session lows.

AUD/USD plummets on USD strength

Spot has quickly left behind the critical support at the 0.7100 handle and dropped to the current area of session lows in the mid-0.7000s in response to a strong rebound of the US dollar, which continues to hurt the USD-denominated assets.

In addition, the generalized softer tone in the commodities’ space is adding further downside pressure to AUD, which is already trading in 2-day lows.

AUD/USD key levels

As of writing the pair is losing 0.24% at 0.7055 and a breach of 0.7021 (20-day sma) would expose 0.6999 (low Feb.3) and finally 0.6916 (low Jan.26). On the flip side, the next hurdle aligns at 0.7246 (high Feb.4) followed by 0.7325 (200-day sma) and then 0.7388 (monthly high Dec.4).

The Aussie dollar is now rapidly losing the grip vs. the greenback, pushing AUD/USD to the 0.7060/50 band, or session lows…

(Market News Provided by FXstreet)

China: Possible 6.5-7.0% growth target for 2016 – Nomura

Research Team at Nomura, notes that according to the latest news from the Chinese government, the growth target for 2016 is set at 6.5-7.0% (unconfirmed).

Key Quotes

“Such a target is consistent with our view. However, we still believe such a target is too challenging and more aggressive easing is required to reach the target. At this stage, because of strong headwinds and the lack of clarity on how the government will stimulate the economy, we maintain our forecast that real GDP growth will slow to 5.8% in 2016 from 6.9% in 2015. We recognise that the risks to our forecast are skewed to the upside, as the government may implement stronger-than-expected easing measures to ensure that economic growth reaches the stated target.

However, the Fed’s emphasis on data dependency means Yellen will most likely stop short of taking additional rate hikes off the table in the near term, even though the markets are now pricing only about a 50% probability of a rate increase this year. Unless there is an outsized and unwarranted reaction in financial markets to Yellen’s testimony on Wednesday, Thursday’s appearance should be a nonevent.”

Research Team at Nomura, notes that according to the latest news from the Chinese government, the growth target for 2016 is set at 6.5-7.0% (unconfirmed).

(Market News Provided by FXstreet)

Gold at 3-1/2 month high, up $100 in one month

FXStreet (Mumbai) – Gold extended gains to a fresh 3-1/2 month high of USD 1181.72 levels as the flight to safety continues in early US session.

Metal up $100 within one month

Prices began the rally form the intraday low of USD 1070.90 seen on Jan 14th largely on account of the risk-off in the global markets. Japan’s negative rate surprise and the ECB’s readiness to do more in March only added to the bullish momentum.

As of now, the major US index futures are pointing to a weak opening. Hence, the upside remains exposed as we approach the opening bell.

Gold Technical Levels

The immediate resistance is seen at 1183.00 (Oct 28 high), above which prices could test 1191.57 (Oct 15 high). On the other hand, a break below 1163.80 (daily low), under which losses could be extended to 1157.22 (76.4% of Oct high-Dec low).

Gold extended gains to a fresh 3-1/2 month high of USD 1181.72 levels as the flight to safety continues in early US session.

(Market News Provided by FXstreet)

Fed: Yellen’s speech is all important this week – Deutsche Bank

Research Team at Deutsche Bank, suggests that the Yellen’s prepared remarks at her semi-annual testimony will be the same on both days; only the Q&A sessions will be different.

Key Quotes

“We expect the Chair to highlight that the Fed is closely watching the recent tightening in financial conditions, and that this development could affect monetary policymaking. Such dovish comments would essentially echo recent remarks by Vice Chair Fischer and NY Fed President Dudley, who tend to have similar economic and financial views to Yellen.

However, the Fed’s emphasis on data dependency means Yellen will most likely stop short of taking additional rate hikes off the table in the near term, even though the markets are now pricing only about a 50% probability of a rate increase this year. Unless there is an outsized and unwarranted reaction in financial markets to Yellen’s testimony on Wednesday, Thursday’s appearance should be a nonevent.”

Research Team at Deutsche Bank, suggests that the Yellen’s prepared remarks at her semi-annual testimony will be the same on both days; only the Q&A sessions will be different.

(Market News Provided by FXstreet)