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AUD/USD had a rough week, slipping 110 points. The pair closed at 0.7279.  There are only  two events next week. Here is an outlook on the major market-movers and an updated technical analysis for AUD/USD.

In the US Final GDP for  Q3  was solid,  posting a gain of 2.0%.  This  figure was  very close to the estimate. Housing numbers disappointed, and durable goods were weak, but within expectations. The only Australian indicator, CB Leading Index, matched the forecast.

[do action=”autoupdate” tag=”AUDUSDUpdate”/]

AUD/USD graph with support and resistance lines on it. Click to enlarge:

AUD_USD Weekly Forecast Dec31-Jan1


  1. Private Sector Credit: Thursday, 00:30. Analysts keep a close eye on borrowing indicators, as higher credit levels usually translate into increased spending,  a key driver of economic growth. The indicator edged down to 0.7% in November, above the forecast of 0.6%. The estimate for the December reading stands at 0.6%.
  2. Chinese Manufacturing PMI: Friday, 1:00. Chinese key releases such as Manufacturing PMI can have a strong effect on the Australian dollar, as the Asian giant is Australia’s number one trading partner. The index has been steady in recent months, hovering just below the 50-point level, which indicates very slight contraction in the Chinese manufacturing sector. More of the same is expected in the December report, with an estimate of 49.9 points.

* All times are GMT.

AUD/USD Technical Analysis

AUD/USD moved higher throughout the week. The pair started the week at 0.7168 and quickly touched a  low of 0.7154, testing support at  0.7160 (discussed last week). AUD/USD then reversed directions and  climbed to a high  of 0.7279.  The pair  closed the week at 0.7243.

Live chart of AUD/USD: [do action=”tradingviews” pair=”AUDUSD” interval=”60″/]

Technical lines from top to bottom:

We start with resistance at 0.7630.

0.7533 has remained intact since July.

0.7440 capped the pair in August and remains key resistance.

0.7284 held firm in resistance as the pair posted strong gains last week.

0.7160 remains busy and is providing support.

0.7100 is next.

The round number of 0.70 worked as a cushion in August and is a strong support level.

0.6899 has provided support since September. This is the final support level for now.

I am  neutral on AUD/USD

The US dollar continues to enjoy support in the aftermath of the historic Fed rate hike. We may see some choppiness this week due to thin liquidity in the markets over the Christmas break.

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