Home AUD/USD Breaks Resistance

The Australian dollar enjoyed a better mood in Europe and jumped higher, finally crossing the important 0.9660 line. This line provided strong support in recent weeks and turned into strong resistance in recent days.

Earlier in the day, Australian GDP disappointed with a modest rise of 0.2% in Q3, while expectations stood on 0.5%. Also the figure for Q2 was revised to the downside, from 1.2% to 1.1%. But the Aussie only fell to the 0.9540 support level – it didn’t go lower.

And then good news came along – soon after the GDP release, Chinese Manufacturing PMI was released and it was slightly better than expected – 55.2 instead of 54.8. The Aussie bounced quickly. This shows over and over again how the Australian dollar depends on China. But, it’s important to note that it wasn’t enough to send AUD/USD above resistance.

The improved mood in Europe made the difference. ECB president Jean-Claude Trichet hinted that bond buying would resume. Yields on Euro-zone peripherals finally fell after reaching record highs, the Euro rose, stocks rose, and the Aussie finally cut through.

The next hurdle is 0.9724, which was the bottom border of a range between 0.9724 and 0.9863. For more technical levels and analysis, see the AUD/USD forecast.

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Yohay Elam

Yohay Elam

Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.