AUD/USD Resistance Around 0.7050 Might Push the Price Much Lower

Australia – National Australia Bank (NAB) Limited Business Confidence Index

Today, at GMT 12:30 a.m., the National Australia Bank (NAB) Limited will release its monthly business confidence index figure. This figure measures the level of a diffusion index based on a survey of 350 businesses in Australia.

The survey asks respondents to rate the current business environment in Australia. Since businesses are the first to react to changing business conditions, the level of their sentiment regarding optimism and business confidence, binary options traders consider it as a leading indicator of the overall economic health in the coming months.

Last month, in December 2015, the NAB business confidence index came out at 5 and this month it came out much worse, at 3.

United States – The Conference Board (CB) Consumer Confidence Index

Tomorrow, at GMT 3:00 p.m., United States based Conference Board Inc. (CB) will release its consumer confidence index, which measures the changes in the level of a composite index by surveying 5,000 households in the United States.

The large sample size (5,000) of the survey makes it one of the most comprehensive research data regarding the consumer spending pattern in the country. Since consumer confidence is correlated with consumer spending, binary options investors pay close attention to the CB consumer confidence index.

Last month, the CB consumer confidence index reading came out at 96.5 and the forecast for December is currently set at 96.6.

Trade Recommendation for the AUD/USD

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After breaking below the uptrend line on January 6, the AUD/USD price has fallen around 300 pips over the last few weeks. However, after the AUD/USD found strong support around the 0.6800 level last week, the pair has retraced back to the 0.7050 level.

Last Friday, the AUD/USD price reached near the 0.7050 level, and formed a bearish pin bar, as a result it appears that there is a bearish momentum in the market. Furthermore, as the NAB business confidence index has fallen to 3 this month, the fundamental outlook also appears to be bearish for the moment.

Under the circumstances, it would be recommended that traders consider placing a PUT order for the AUD/USD with their binary options brokers at market price, as long as it remains below 0.6985.

Recommended Broker: HighLow.net

Asif worked as a prop trader for almost a decade, and later he managed trading operations for one of the largest foreign exchange strategy developers in Europe. Currently, he works as a trading consultant to several brokers and writes on various tech and financial topics. You can reach him at contact@asifimtiaz.com

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Asif Imtiaz

Asif worked as a prop trader for almost a decade, and later he managed trading operations for one of the largest foreign exchange strategy developers in Europe. Currently, he works as a trading consultant to several brokers and writes on various tech and financial topics. You can reach him at contact@asifimtiaz.com

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