AUD/USD has been quite impulsive and consistent with the recent bullish pressure after the price was rejected off the 0.6750 support area after an impulsive downward leap. Despite downbeat economic reports from Australia, AUD managed to sustain the bullish momentum over USD which generates strength of AUD in the pair.
Recently Australia's Trade Balance report was published with a decrease to 1.93B from the previous figure of 2.01B which was expected to increase to 2.18B and Building Approvals contracted to -9.1% from the previous value of -1.5% which was expected to increase to -0.3%. Ahead of Retail Sales report to be published tomorrow which is expected to be unchanged at 0.3%, the Australian economy is currently quite feeble that is confirmed by the latest economic data.
On the other hand, USD lost ground after the recent FOMC Meeting where FED policymakers stated that the rate hike mechanism is going to slow down, and the FED is not going to increase its rates rapidly this year like in 2018. Moreover, the employment reports were mixed and not as expected which nudged USD to lose momentum. Today FED Chairman Powell and FOMC Member Bullard are going to speak about the forward guidance, including short term interest rates and stance on monetary policy. The FED is currently trying to slow down the rapid global economic growth which if not controlled may lead to severe risk of a financial crisis in the future.
Meanwhile, USD is currently much softer in comparison to AUD which has already derived the market sentiment and bias against it. Though AUD has been struggling amid the recent economic reports, any positive data from Australia may encourage bullish momentum in the future.
Now let us look at the technical view. The price is currently residing above 0.7150 price area while being held by the dynamic level of 20 EMA as support. After the recent impulsive bearish rejection with a daily close below 0.70 area, the bulls have already showed their strength in the market and their further objective to push higher in the coming days. As the price remains above 0.70 area with a daily close, the bullish bias is expected to continue further with a target towards 0.7350 resistance area in the coming days.
SUPPORT: 0.7000-50, 0.7150
RESISTANCE: 0.7350, 0.7500
BIAS: BULLISH
MOMENTUM: VOLATILE
The material has been provided by InstaForex Company -
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