The Australian dollar closed another week on the downside but managed to stabilize. What’s next? A speech by RBA Governor Lowe stands out. Here are the highlights of the week and an updated technical analysis for AUD/USD.
Australia gained 22.6K jobs in April, better than had been expected. The good news helped the Aussie. Australia’s No. 1 trading partner, China, saw industrial output rise by 7% y/y also above predictions. In the US, yields reached new multi-year highs, supporting the greenback.
AUD/USD daily graph with support and resistance lines on it. Click to enlarge:
*All times are GMT
AUD/USD Technical Analysis
Aussie/USD continued hugging the round 0.7500 level throughout the week and eventually closed slightly above it.
Technical lines from top to bottom:
0.7730 capped the pair in early April. 0.7675 provides some support in March and is another stepping stone.
Further below, 0.7640 was a stubborn cushion in March and April. The fall below this line proved its strength. 0.7615 capped a recovery attempt in late April.
0.7560 is the next level to watch after it was the recovery level in early May. The round number of 0.7500 remains important despite the recent breach.
0.7430 was an initial low in late April and it is followed by 0.7410, an old line from 2017. Further down, 0.7375 is notable.
I remain bullish on AUD/USD
The Australian dollar weathered the strength of the greenback quite well and enjoys OK economic data. If the USD takes a break, the Aussie is well positioned to take advantage of it.
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