The Australian dollar reached new lows but managed to recover as the market mood improved. What’s next? The RBA Meeting Minutes stand out. Here are the highlights of the week and an updated technical analysis for AUD/USD.
Australia enjoyed a gain of 44K jobs in August, nearly triple the expectations. Another boost to the Aussie came from the trade war front. The US has not imposed new tariffs on China and negotiations have resumed. Do the talks have a fair chance? This is still to be seen, but at the moment, markets are up and the A$ rides the wave.
AUD/USD daily graph with support and resistance lines on it. Click to enlarge:
*All times are GMT
AUD/USD Technical Analysis
Aussie/USD fell lost further ground, temporarily dipping below 0.71 (mentioned last week) before staging an impressive recovery.
Technical lines from top to bottom:
0.7480 capped the pair in mid-July and defends the round 0.75 level. 0.7420 capped the pair twice in mid-July. 0.7360 was a low point in mid-July.
0.7310 is the low of July 2018. 0.7235 was a swing low in late August and the pair attempted to reach it in mid-September.
The round number of 0.7200 was a temporary low. 0.7150 was a stepping stone on the way down in early September. 0.7085 is the 2018 trough.
Below, we are back to levels last seen in January 2017: 0.7050 could provide some temporary defense against an assault on the round 0.70 level. Even lower, 0.6880 is the next level to watch.
I am bearish on AUD/USD
The trade truce is probably temporary and the US Dollar is set to resume its rises.
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