AUD/USD Forecast: Easing within range, downside limited

Valeria Bednarik FXStreet

AUD/USD Current Price: 0.6973

Australian employment figures beat the market’s expectations in June.
Chinese Q2 GDP printed at 11.5% much better than anticipated.
AUD/USD is technically neutral in the short-term, bearish only below 0.6900.

The AUD/USD pair trimmed Wednesday’s gains, ending the day in the red yet around 0.6970. Encouraging data released at the beginning of the day was offset by concerns about the future of the global economy, as the coronavirus pandemic seems only to be getting worse. The number of global cases is on the rise and above 13 million, and small outbreaks are being seen worldwide, leading to some new lockdowns.

The market ignored the fact that Australia added 210.8K jobs in June, almost doubling the market’s forecast, while the unemployment rate met the market’s expectations at 7.4%. Additionally, HIA New Home Sales soared in May by 87.2%. News coming from China were also encouraging, as the Q2 GDP resulted at 11.5%, beating the expected 9.6%, while Industrial Production in the country rose in June by 4.8% YoY. The only miss was Retail Sales, which in the same period declined by 1.8%.

AUD/USD short-term technical outlook

The AUD/USD pair retains its neutral stance, with the bearish potential limited. In the 4-hour chart, the pair is hovering around a flat 20 SMA but above the larger ones, as technical indicators ease within positive levels, reflecting the ongoing retracement from recent tops, but far from supporting a bearish extension ahead. For that to happen, the pair would need to lose the 0.6895 level, the base of its latest range.

Support levels: 0.6940 0.6895 0.6850

Resistance levels: 0.7025 0.7060 0.7100

View Live Chart for the AUD/USD

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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