The Australian dollar moved on, higher and higher, enjoying the holiday week to close 2017 on a positive note. Will this continue into 2018? The new year starts with figures from both China and Australia Here are the highlights of the week and an updated technical analysis for AUD/USD.
Prices of copper went up and with nothing really happening, the Aussie was reminded of the correlation with this industrial metal. In addition, the US dollar suffered from some profit taking and lost some ground.
AUD/USD daily graph with support and resistance lines on it. Click to enlarge:
AUD/USD Technical Analysis
Aussie/USD enjoyed a rally, initially hesitating at 0.7730 (mentioned last week) but then continuing higher and higher.
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. The round number of 0.77 capped the pair in mid-December. 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.
I am bearish on AUD/USD
The Aussie certainly took advantage of the downfall of the greenback and the rise in copper prices. However, this significant rise is not really in line with economic fundamentals.We could see a correction now.
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