The Aussie enjoyed a positive week and began struggling with higher barriers. Here’s an outlook for the events that will move the Aussie and an updated technical analysis for AUD/USD.
AUD/USD chart with resistance and support lines on it. Click to enlarge:
The meeting minutes showed that the central bank is worried about European developments, but seems confident about the Australian economy. Indeed, the Aussie rose quite nicely in the past week, and took dips only on bad European news. OK, let’s start:
- New Motor Vehicle Sales: Published on Monday at 1:30 GMT. With Australia’s great outback, vehicle sales are significant for the economy. Last month’s leap of 8.4% was strongly felt in the currency. A small drop is expected this time, as this indicator is quite volatile.
- CB Leading Index: Published on Wednesday at 1:30 GMT. Most of the 7 economic indicators that build this indicator have already been released. Nevertheless, this still has an impact on the Aussie. After two months of drops, the leading index recovered last month and rose by 0.3%. Given the great improvement in employment, another rise can be expected now.
AUD/USD Technical Analysis
The Aussie made a significant breakout in the past week. After a struggle, it passed the critical 0.8567 resistance line and made a failed attempt for the next line – 0.8735, which was December’s low. The pair is currently bound between these two lines.
Note that some higher lines were added on last week’s outlook. Above 0.8735, 0.88 is the next resistance line, being a swing low a few months ago. Higher, 0.90, is a round number and also served as a support line.
Higher, also 0.9135 was a strong support line and now works as resistance. It’s followed by the minor resistance line of 0.9250 and then by a very strong line – 0.9327, which worked as a resistance line many times in the past. The year-to-date high of 0.9366 is the last line.
Looking down below 0.8567, 0.8360 provides support. This was a pivotal line in the past weeks. Lower, 0.8240 was also a significant line in recent weeks as well as last summer. It’s followed by the year-to-date low of 0.8066.
I remain bullish on the Aussie.
The Aussie has all the reasons to rise, with an excellent job market, a high interest rate, growing economy and now also record high levels of gold.
- For a broad view of all the week’s major events worldwide, read the forex weekly outlook.
- For EUR/USD, check out the Euro/Dollar Forecast.
- For GBP/USD (cable), look into the British Pound forecast.
- For the New Zealand dollar (kiwi), read the NZD/USD forecast.
- For USD/CAD (loonie), check out the Canadian dollar forecast.
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