The Australian dollar closed lower for the fourth week in a row but did not record new lows for a change. Is it ready to recover? A speech by Phillip Lowe is the main event in a busy week. Here are the highlights of the week and an updated technical analysis for AUD/USD.
The Reserve Bank of Australia left the interest rate unchanged once again and did not indicate any change. Most Australian figures such as the trade balance and retail sales came out above expectations. However, China, Australia’s main trade partner is expecting slightly weaker growth according to the forward-looking PMI figures.
AUD/USD daily graph with support and resistance lines on it. Click to enlarge:
*All times are GMT
AUD/USD Technical Analysis
Aussie/USD flirted with the 0.7650 level (mentioned last week) before bounvcing. However, the pair did not go anywhere fast.
Technical lines from top to bottom:
0.8050 capped the pair in August and also temporarily in January, on its way up. 0.7990 was the high point in February and protects the 0.80 level.
0.7890 worked as support in February and resistance in October. 0.7780 capped the pair in late March and also was a pivotal line in February.
0.7730 capped the pair in early April. 0.7675 served as a line of support in mid-March.
Lower, 0.7640 was a trough in late Marc. The last line to watch is the round 0.75 level which is where the began its assent in December.
As the chart shows, AUD/USD is trading in a downtrend channel. This is a bearish sign. The pair holds on to this channel.
I remain bearish on AUD/USD
The RBA is in no rush to make any move while the Fed is keen to raise rates even if the tensions around global trade take a toll on the economy.
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