New Car Sales - Australia
At 12:30 am GMT, the Australian Bureau of Statistics released the New Vehicle Sales Volume, which measures changes in the number of new cars sold in the local market over the past month.
New car sales are a leading indicator of consumer confidence because buying something expensive such as a car or truck shows that consumers are optimistic about their financial situation in the future. Thus, binary options traders gauge the general economic situation in Australia using this fundamental data.
Last month, during February, the volume of new car sales in Australia fell by 1.9%, but during the current month, the volume of sales rebounded again and rose by as much as 2.9%.
USA - Capacity utilization rate
Later in the afternoon, at 13:15 GMT, the US Federal Reserve released the Domestic Capacity Exploitation Rate, which measures the percentage of available resources that are used by manufacturers, miners, and utility service providers in the country.
When producers use their available resources to their full potential, they tend to increase prices and ultimately the higher cost is passed on to consumers. Therefore, binary options traders view the capacity utilization rate as a leading indicator of consumer inflation in the US.
In February, the US capacity utilization rate came in at 79.4% and expectations for March came in at 79.5%. But if the capacity utilization rate is above 80%, this indicates a rise in consumer price inflation in the US over the next few months, which will add more strength to the US dollar.
Trading recommendations for the AUD/US dollar currency pair
The AUD/USD currency pair has continued to decline over the past few weeks after the pair broke below the strong support area near the 0.8000 level on January 23, 2015. The AUD/USD pair tested the 0.8000 level again on January 28. However, he was unable to break through the limit above this level, which turned into a strong resistance.
As a result, the AUD/USD formed a bearish outer band (BEOB) and the price quickly fell towards the Fibonacci extension as much as 261.8% of the previous ascending swing extension towards the trend line, where it found temporary support, at 0.7615.
Australian new car sales also rebounded over the past month, supporting the AUD/USD at the current price level. However, the pair may find additional downside momentum if the US capacity utilization rate comes above the 80% level. In this case, it is recommended that binary options traders place a PUT order as soon as the AUD/USD price goes below the 0.7550 level.
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