- No news is good news for a bullish Aussie on a quiet Monday.
- Friday’s bounceback on a weakening US Dollar is a welcome reprieve for AUD buyers.
The AUD/USD is trading close to Friday’s highs near 0.7440 following a bullish move against the US Dollar to close out last week’s action, and the new week is expected to maintain broader market sentiment with a quiet schedule slated for Monday.
It’s a very quiet week for the Aussie on the economic calendar, and the first round of scheduled action won’t be until Friday with mid-tier Home Sales data. Even the Reserve Bank of Australia (RBA) is absent from the week’s data docket, giving RBA Governor Philip Lowe a rare opportunity to avoid having to address markets directly and continuously reminding traders that the RBA is in full-on wait-and-see mode as it pertains to interest rates, and the Australian economy in general.
For the AUD, no news truly might be good news, as last week’s bullish turnaround is being attributed to the US Dollar’s broader decline following an easing in US Treasury yields, rather than from any intrinsic strength in the Aussie itself. AUD bulls have been keen to jump on the snap-back wagon in the AUD/USD pair, but a lack of economic data for the Aussie on the week will leave the pair fully exposed to overall market sentiment swings, and bullish positions could find themselves unwinding very quickly if traders find themselves favoring the Greenback once again.
AUD/USD levels to watch
FXStreet’s Valeria Bednarik highlights that the Aussie’s still-weak position in the markets is present across the technical landscape, noting that, “the daily chart shows that the pair is well below all of its moving averages, which maintain their bearish slopes, while technical indicators have bounced modestly from oversold readings, the Momentum already turning flat and the RSI at 41, indicating that the latest recovery could be reverted by bears. Shorter term, and according to the 4 hours chart, however, the pair could extend its current upward corrective movement, as it is advancing above a bullish 20 SMA, while technical indicators hold well above their midlines, partially losing their upward strength amid decreasing volumes at the end of the week, and not as a sign of decreasing buying interest.”
Support levels: 0.7410 0.7380 0.7345
Resistance levels: 0.7470 0.7505 0.7540
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