- A sedate open for the week keeps the AUD/USD trapped near 0..7200.
- A lack of Aussie data leaves the major pair tied to broader market sentiment.
The AUD/USD sees light trading volumes to walk through the door for the next trading week, sticking to levels near 0.7230.
A dour market approach to market sentiment sees the AUD largely hung up on familiar levels that the AUD/USD has been cycling around over the past month, and with little impetus for the AUD/USD to buckle down, continued mid-range action can be expected. This week sees little of note on the economic calendar for the Aussie, with an early-week speech from the Reserve Bank of Australia’s (RBA) Mark Carney focused on topics other than monetary policy, and the rest of the week sees market focus turning towards the FOMC as a key driver for flows this week.
AUD/USD Levels to watch
The Aussie has seen little internal momentum develop over the past little while, instead seeing AUD traders getting pulled along with the frequent back-and-forth swings in broader market sentiment, and as FXStreet’s own Valeria Bednarik noted, plays to the middle ground are likely to continue without broad-market shifts in risk appetite:
The pair held these last few days above 0.7200, also above the 38.2% retracement of the 0.7020/0.7337 rally at 0.7215, with a break below this area probably damaging, at least temporarily, bulls’ confidence. Technical readings in the daily chart support such view, as the pair closed below the 100 DMA, while a bullish 20 DMA converges with the mentioned Fibonacci support, reinforcing the key support area. Technical indicators maintain strong bearish slopes right above their midlines, at a brink of entering negative ground. In the 4 hours chart, the bearish case is even stronger, as the pair finished below its 20 and 100 SMA, with the shorter about to cross below the larger one, both above the current level, and technical indicators maintaining their downward slopes within negative ground. The downward case with gain momentum on a break below 0.7170. Above 0.7265, on the other hand, the pair will likely recover its positive momentum an attempt again to break through 0.7300.
Support levels: 0.7200 0.7170 0.7140
Resistance levels: 0.7265 0.7300 0.7340
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