The Australian dollar fell on fears of trade wars and ahead of the Fed decision. The upcoming week features important events from Australia: the jobs report and also the RBA meeting minutes. Will the pair recover? Here are the highlights of the week and an updated technical analysis for AUD/USD.
Chinese industrial output rose by 7.2% in February, much better than expected and an encouraging sign for Australia. However, Trump’s ongoing push for tariffs and the fear of trade wars weighed on the Australian dollar, a risk asset. The upcoming Fed decision also pushed the greenback higher.
AUD/USD daily graph with support and resistance lines on it. Click to enlarge:
*All times are GMT
AUD/USD Technical Analysis
Aussie/USD had a stable start to the week but suffered a sharp fall and closed the week just above the 0.77 level mentioned last week.
Technical lines from top to bottom:
0.8130 was the high point in 2017 and was challenged early in the year. 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.
0.7760 was the low point in mid-February and works as support. The round level of 0.77 was resistance in December.
Lower, 0.7650 worked as resistance in several occasions in late 2017. The last line to watch is the round 0.75 level.
I turn from bearish to neutral on AUD/USD
While the trade story is still quite worrying for Australia, a not-so-hawkish Federal Reserve and a stable jobs report at home can help the A$ stabilize, perhaps before another fall later on.
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