AUD/USD analysis: no relief for Aussie, 0.6826 in the cards
AUD/USD Current price: 0.7191
- Tensions with China and global trade woes hit hard the Aussie.
- Australian TD Securities Inflation for August to be out this Monday.
The AUD/USD pair fell to a fresh yearly low of 0.7175 and settled a handful of pips above this last, with the Aussie being the worst performer against the greenback. The Australian currency was undermined by a combination of factors, which include local political turmoil, escalating global trade tensions, and falling base metals. At the same time, tensions between the country and China rose as this last is denying visas to Australian journalists while Australia is banning China's Huawei cells from its mobile network market. The recovery in US equities at the end of the way wasn't enough to offset the negative sentiment toward the Aussie. The country will start the week with the release of August TD Securities Inflation for August, previously at 2.0% YoY. The AUD/USD pair trades at levels last seen in January 2017, and the daily chart shows that selling interest remains strong, as it plunged after breaking below a now bearish 20 DMA, also well below the larger ones, while technical indicators entered negative territory with strong downward slopes. The next relevant support comes at the 0.7150 region, where the pair bottomed multiple times by the end of 2016 and the beginning of 2017, also with lows from late 2016, with a break below it exposing 0.6826, 2016 low. In the 4 hours chart, the pair has fallen over 100 pips below a now vertical 20 SMA, which broke below the 100 SMA, while technical indicators posted modest bounces, with the RSI currently at 26, falling short of suggesting an upward corrective movement ahead.
Support levels: 0.7150 0.7120 0.7090
Resistance levels: 0.7215 0.7260 0.7300
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.
