The Australian dollar continued grinding lower surrendering to the might of the US dollar. The jobs report is the highlight of the week. Will the Aussie continue falling? Here are the highlights of the week and an updated technical analysis for AUD/USD.
The RBA left the interest rate unchanged as expected and sounded a bit more optimistic. Retail sales rose by 0.5% and it also provided an early cushion to the Aussie. However, the GDP report missed by rising by only 0.6%, weighing on the A$. In the US, the jobs report was mixed, but the greenback enjoyed the advances made on tax cuts.
AUD/USD daily graph with support and resistance lines on it. Click to enlarge:
AUD/USD Technical Analysis
The Aussie failed to break above the 0.7840 level (mentioned last week). It then dropped to the lower ground, hardly holding onto the 0.75 level.
Technical lines from top to bottom:
The psychological round level of 0.80. Below, we find 0.7940, which capped the pair in August.
0.7860 served as support during September and is another line to watch. 0.7785 was a stepping stone on the way up.
Below, we find 0.7730, that was a high point in June 2017 and also beforehand, working as resistance in November. 0.7640 worked as resistance in November.
0.7595 was a swing high in early December and capped the pair. 07550 provided support in late November.
0.7530 is the cycle low, very close to the previous line and the last stop before the round number of 0.75.
Even lower, we find 0.7440 and then 0.7375.
I remain bearish on AUD/USD
The jobs report could disappoint for the second time in a row and even if it doesn’t the trend remains clear: to the downside. The US dollar is expected to remain stable amid the expected rate hike by the FED.
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