AUD/USD Current Price: 0.7105
- Australian businesses activity improved in July, with the Composite PMI hitting an over 3-year high.
- The dismal tone of global equities kept the upside limited for the pair.
- AUD/USD could resume its advance on a recovery above 0.7020.
The AUD/USD pair managed to close Friday unchanged at 0.7105, up for the fifth consecutive week. Australian data released at the beginning of the day offset the poor performance of equities, as the Commonwealth Bank preliminary July Manufacturing PMI rose to 53.4 from 51.2, slightly below expected, while the services index jumped to 58.5 from 53.1, leaving the Composite PMI at 57.9, the highest in over three years. As said a risk-off mood limited the pair’s advance, with worldwide equities closing in the red. The Australian macroeconomic calendar has nothing to offer this Monday.
AUD/USD short-term technical outlook
The AUD/USD pair has corrected from a multi-month high of 0.7182, and the daily chart suggests that the slide has been corrective, and may be completed, opening the doors for higher highs in the days to come. In the mentioned time-frame, technical indicators have eased within positive levels, but lack downward strength as the 20 SMA gains bullish strength below the current level. In the shorter-term, and according to the 4-hour chart, the risk is skewed to the downside, as the pair is below its 20 SMA, providing dynamic resistance around 0.7120, while the Momentum indicator heads south within negative levels. The RSI has stabilized around 54, somehow limiting the bearish potential. A recovery above the mentioned 0.7120 level should favour additional short-term advances.
Support levels: 0.7065 0.7030 0.6995
Resistance levels: 0.7120 0.7160 0.7200
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