The data supporting the global economic recovery continues to be mixed - patchy, inconsistent over time, and varying enormously by region - and in no way supporting the idea of a "V-shaped" recovery, the popular view six months ago.

While there is little doubt that a recovery is underway, if it continues in this fashion it has strong implications for markets.

Trading Ranges, Not Trends

The key factor is that markets are likely to trade

"sideways", rather than trending in a particular direction. This means that they could trade in ranges.

Comfort around the European banking system, and a recovery in the Shanghai Composite Index, has led to more investor appetite for "risk" assets - including the Australian dollar.

The move up through .8851 for the AUD/USD CFD is signaling a new trading range, between .8851 and .9224 initially, and possibly .9378.

AUD/USD Daily