The Australian dollar initially gapped just a touch lower to kick off the week, but then turned around to rally back into the middle of the consolidation area.
Looking at the underlying holdings of the ETFs in our coverage universe at ETF Channel, we have compared the trading price of each holding against the average analyst 12-month forward target price, and computed the weighted average implied analyst target price for the ETF itself. For the Vanguard Communication Services ETF (VOX), we found that the implied analyst target price for the ETF based upon its underlying holdings is $160.39 per unit.
The direction of the AUD/USD on Monday is likely to be determined by trader reaction to .7352.
The dollar edged lower Monday, just above a one-month low, in tight trading ranges ahead of the release of key U.S. employment data later in the week which could influence Federal Reserve policy. The dollar index dropped close to 1% last week after Fed Chairman Jerome Powell stated, following the central bank’s July meeting, that interest rate increases were still a long way away and more economic progress was needed, particularly in terms of jobs being created, before the central bank started tapering its huge bond-buying program. Fed board member Lael Brainard restated the central bank's focus on further labor market progress at the weekend, while Minnesota Fed President Neal Kashkari warned that the spread of the delta variant of Covid-19 could slow the economy in the second half.
Some investors feel that RBA policymakers may be forced to walk back their plan to begin tapering their bond purchases announced on July 6.
Economic data and monetary policy will be in focus in the week ahead. Both the RBA and the BoE are in action. Expect FOMC member chatter to also draw attention.
The Australian and New Zealand Dollars edged lower on Friday, as upbeat data helped the U.S. Dollar reverse some of its losses since Wednesday when dovish remarks by the U.S. Federal Reserve helped bring an end to its month-long rally. Meanwhile, profit-takers hit the Aussie and Kiwi as a shift in investor sentiment sent up a caution flag ahead of the weekend. U.S. consumer spending surged in June as vaccinations against COVID-19 boosted demand for travel-related services, but part of the increase reflected higher prices, with annual inflation accelerating further above the Federal Reserve’s 2% target, Reuters reported.
The Australian dollar has gone back and forth during the course of the trading week as we dance around the 200 week EMA again.
The Australian dollar has gone back and forth during the course of the trading session on Friday, as we continue to see that the market is cautious to say the least.
The Australian and New Zealand Dollars are trading lower on Friday, pressured by a drop in demand for higher risk currencies that is being fueled by a plunge in global equity markets. The Aussie and Kiwi are being underpinned, however, by a weaker U.S. Dollar. Meanwhile, the Covid situation in Australia is worsening, raising fears that the country will experience another virus-related contraction during the third quarter.