AUD/USD lacks direction around 0.7580, Australia CPI eyed

Currently, AUD/USD is trading at 0.7580, down -0.05% on the day, having posted a daily high at 0.7606 and low at 0.7553.

On the AUD economic docket, investors and traders await the Consumer Price Index YoY figures, consensus target 1.6% which value represents +0.3% increase from previous 1.6%. Furthermore, if the final figure prints a value as 'expected' or 'better than expected,' in a matter of seconds risk-sentiment may shift towards adding more long-Aussie positions. Historical data indicates that the Australian dollar had it highest performance day at +1.18% or 89-pips (Jan.17) and the lowest at -0.81% or 61-pips (Jan.18). 

No Recession; Thank You, Immigrants

Carrington Clarke, Business reporter at ABC News AU notes that Australia has ridden 25 years of economic growth without a recession. An amazing stretch of prosperity and a badge of honour that governments of all persuasions have tried to claim as their own. But often underappreciated is the role that migration has played. A huge increase in migration has fuelled headline GDP growth, keeping Australia technically out of recession. But, it's also masked a dirty secret, individuals haven't felt the benefit of this record run.

He further writes, "In fact, since the GFC, Australia has seen per capita income go backwards and it's only recently recovered. Even if the visitor visa category is stripped out of the aggregate temporary migration numbers, the total number of temporary migrant entrants sat at 1,608,460, which is a rise of 4.3 per cent in one year. Overall Australian population growth has averaged 1.7 per cent over the last decade - that's more than double the rate in the US over the same period."

Technical levels to watch

Valeria Bednarik, Chief Analyst at FXStreet, notes, "The AUD/USD pair trimmed its daily gains and closed the day a handful of pips above Friday's close, after flirting with the recent multi-month high of 0.7588. Higher commodities' prices underpinned the Aussie, with most base metals up this Monday, although the negative tone of equities limited the advance. There won't be any relevant macroeconomic releases in Australia until next Wednesday when the country will release its latest quarterly inflation figures." 

She further writes, "Despite the pair failed to break above previous high, the positive tone persists, although losing momentum, given that in the 4 hours chart, the price is steadily meeting buying interest around a horizontal 20 SMA, around 0.7530, whilst technical indicators have turned modestly lower, but still remain within positive territory. As commented on previous updates, the pair needs now to surpass the 0.7600 level to be able to extend its gains towards the 0.7700 region, and beyond, should upcoming inflation readings surpass market's expectations." 

On the long-term view, expanding Valeria's analysis, worth to evaluate the Australian dollar current price action and challenges in 2017. To the upside, barriers are aligned at 0.7841 (short-term 38.2% Fib) above that at 0.7920 (long-term 50.0% Fib) and a close and open above that level would open doors to target 0.8155 (short-term 50.0% Fib). To the downside, supports are aligned at 0.7453 (short-term 23.6% Fib), below that at 0.7177 (long-term 38.2% Fib) and a close and open below that level would drag the pair lower towards 0.6826 (low Jan.2016). (Note: Long-term Fib from September 1998 to May 2001 low and high June 2011, then Shor-term Fib from July 2014 high to January 2016 low)

AUDUSD Elliottwave Analysis: Ending wave 5 Impulse