AUD/USD outlook: Extended pullback pressures the top of thick daily cloud

Slobodan Drvenica Windsor Brokers

AUD/USD

The Australian dollar dipped below 0.7800 handles on Wednesday after weaker than expected China bank loans data, with increased pressure coming from falling Asian equities.

Fresh weakness signals an extension of a pullback from 0.7890 (May 10 high), where larger bulls stalled.

Bullish daily studies (rising positive momentum / MA’s in bullish setup) suggest limited correction before bulls regain traction.

Top of thick daily cloud (0.7769) and Fibo 38.2% of 0.7531/0.7890 (0.7753) offer solid supports which should contain dips and keep bulls intact for a renewed attempt at 0.7794 targets (Fibo 76.4% of 0.8007/0.7531).

Caution on the break of these levels which could open the way for deeper correction and expose supports at 0.7720 zones (converged 30/55/100DMA’s) and 0.7674 (May 4 trough).

Res: 0.7820; 0.7845; 0.7856; 0.7890.
Sup: 0.7785; 0.7769; 0.7753; 0.7720.

Interested in AUD/USD technicals? Check out the key levels

1. R3 0.7896
2. R2 0.7876
3. R1 0.7859
PP 0.7839
1. S1 0.7821
2. S2 0.7802
3. S3 0.7784

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

EUR/USD makes a U-turn, focus on 1.1900

EUR/USD’s recovery picks up further pace, prompting the pair to retarget the key 1.1900 barrier amid further loss of momentum in the US Dollar on Wednesday. Moving forward, investors are expected to remain focused on upcoming labour market figures and the always relevant US CPI prints on Thursday and Friday, respectively.

GBP/USD sticks to the bullish tone near 1.3660

GBP/USD maintains its solid performance on Wednesday, hovering around the 1.3660 zone as the Greenback surrenders its post-NFP bounce. Cable, in the meantime, should now shift its attention to key UK data due on Thursday, including preliminary GDP gauges.

Gold holds on to higher ground ahead of the next catalyst

Gold keeps the bid tone well in place on Wednesday, retargeting the $5,100 zone per troy ounce on the back of modest losses in the US Dollar and despite firm US Treasury yields across the curve. Moving forward, the yellow metal’s next test will come from the release of US CPI figures on Friday.