AUD/USD: more downside to come, looking toppish?
|Currently, AUD/USD is trading at 0.7419, up 0.01% on the day, having posted a daily high at 0.7423 and low at 0.7416.
Forex today: scandals and political tensions roil markets once again
AUD/USD failed to hold onto its gains of yesterday after the positive jobs data. The highs at 0.7466 were shortlived and 0.7411 was the low in the US session on an advancement in the dollar related to optimism over a the Comey video news. For today, there is little to go on and analysts at Westpac suggested that it is looking toppish. "A break below 0.7410 would signal a further 0.5c fall," they suggested.
Australian Job Market Continues to Firm
AUD/USD 1-3 month:
Their longer term outlook is also bearish. "The modestly weaker than expected Australian CPI outcome has added yet another factor capping the A$: softer commodity prices; a more protectionist stance from US President Trump, and higher US yields if the Fed raises rates in June as we expect. These leave the A$ with strong resistance at 0.76. We expect to see it heading towards 0.74 by year end."
AUD/USD levels
Valeria Bednarik, chief analyst at FXStreet explained that, technically, the 4 hours chart shows that the 20 SMA has turned flat while the price settled below it. "The Momentum hovers around its 100 level and the RSI turned south, now around 49, all of which anticipates additional declines particularly on a downward acceleration through 0.7390."
Longer term outlook is negative:
Analysts at Commerzbank argued that it is headed to the base of the range offered by the 2016-2017 support line at 0.7301. "This is expected to eventually break down targeting initially 0.7161 December 2016 low then 0.7013 the 2001-2017 support line."
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