- The Aussie looks set to continue trading flat after last week’s quiet affair.
- The early week sees no figures or events for the AUD, first data for the week hits on Wednesday.
The AUD/USD is trading near 0.7560 to kick off the new week, largely unchanged following last week’s sedate moves.
The Aussie traded up last week against the Greenback, but only slightly, finishing barely positive with a scant sub-30 pip gain on the week. The pair hit a one-month high of 0.7605 before getting caught in a lull to finish a week that saw a thin news schedule for the pair as the world focused on US-driven trade headlines.
It’s geared to be another slim schedule on the economic calendar, and the AUD is data-free until Wednesday’s month-on-month Building Permits for April drop, forecast at a -3.0% contraction compared to the previous reading of 2.6%.
AUD/USD levels to watch
FXStreet’s Chief Analyst Valeria Bednarik noted that despite the AUD/USD’s flat tone, technical risks continue to lean bearish for the Aussie: “the AUD/USD pair corrected up to the 50% retracement of its latest weekly decline, ending the week a few pips below the 38.2% retracement of the same slide at 0.7565. The weekly chart shows that it’s the third consecutive one that the pair holds around the current levels, with the candles showing small bodies, but for a change, this last time it managed to post a higher high and a higher low.
The battle for direction continues, although the risk remains skewed to the downside according to technical readings in the weekly chart, as the pair is developing below all of its moving averages, with the 100 SMA being the closest one, and converging with the 61.8% retracement of the mentioned decline at around 0.7655. The Momentum indicator in the mentioned chart has turned south within negative territory, while the RSI hovers around 41. In the daily chart, however, the pair managed to recover and settle above a modestly bullish 20 DMA, while technical indicators retreat within positive territory, not enough to suggest an upcoming decline. The 0.7505 Fibonacci level is the immediate support ahead of the low set at 0.7411, while a break below this last exposes a more relevant long-term support, at 0.7250. To the upside, the 0.7565 level is the first relevant resistance, followed by the mentioned 0.7655 Fibonacci level, with gains beyond this last needed to confirm an interim bottom and further gains ahead.”
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