AUD/USD analysis: back to its comfort zone, mild bullish

Valeria Bednarik FXStreet

AUD/USD Current price: 0.7575

Chinese May manufacturing and non-manufacturing PMI seen steady in May.
AUD/USD flirts with weekly highs, but key resistance lies at 0.7620.

The AUD/USD pair is up over 100 pips and near its weekly high of 0.7580, as headlines coming from Italy, suggesting that the country may not need a new election, brought relief, resulting in a better performance of equities which usually results in an advancing Aussie. Market players ignored poor local data released at the beginning of the day, as April Building Permits fell by more-than-expected, down 5.0% in the month, and up by just 1.9% yearly basis, below the 4.1% forecasted. During the upcoming Asian session, attention will shift to China, and May Manufacturing and Non-manufacturing PMI. The first is expected at 51.3 from the previous 51.4, while the second one is seen remaining steady at 54.8. Better-than-expected numbers could give the AUD an additional boost. The pair heads into the Asian opening above the 38.2% retracement of its latest weekly slide, also above all of its moving averages that anyway continue lacking directional strength, while technical indicators entered positive territory, with the Momentum still in neutral territory but the RSI at 61. The key to the upside is 0.7620, the 50% retracement of the latest weekly decline, as above it, the risk will clearly lean to the upside.

Support levels: 0.7565 0.7505 0.7470

Resistance levels: 0.7620 0.7660 0.7700

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Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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