Fundamentally,the AUD/USD rallied in today’s trading session after reports showed that Private Capital Expenditure came in worse than expected however last month’s figure was revised up which gave the Australian economy a better outlook for 2014. Also,industry data earlier showed that new home sales in Australia rose 2.9% in April, after a 0.2% uptick the previous month. This gave the single currency strength against all its major counter-parts.
Elsewhere, the Bureau of Economic Analysis revealed earlier that the U.S. gross domestic product contracted 1.0% in the first quarter, after a preliminary estimate showed growth of 0.1%. Market expectations had been for a 0.5% contraction. It was the first decline in U.S. GDP since the first quarter of 2011, and the dollar softened on the news, reminding investors that even when the Federal Reserve winds down stimulus programs, rate hikes won’t come for some time afterwards.
Technically intra-day bias remains on the upside with a fresh cross of 21 and 55 EMA emanating on the 1hour charts with a possible reversal in place. The OSMA and SSRC customs indicators are also signalling a fresh bullish continuation is expected in the pair. More demand to 0.93315 is expected and further demand to 0.93411 could be seen.