- Pair remains under November lows, eying 0.7500.
- Aussie hit by AU data and weak commodity prices.
- US dollar remains strong ahead of NFP and FOMC meeting.
The AUD/USD pair is consolidating daily losses and remains near the lowest level since early June. The combination of a weak aussie and a positive tone of the US dollar pushed the pair below November lows, closer to 0.7500.
Sharp reversal, what’s next?
On Tuesday, the pair spiked to 0.7653 (3-week high) but it was rejected and since then it moved with a bearish bias. It has now fallen more than a hundred pips from the highs. Today it broke below 0.7550 and then under the November low (0.7530). It bottomed at 0.7514.
Today’s slide took place amid a rally of the US dollar across the board. The DXY hit the highest level in two weeks. The greenback remains strong after yesterday ADP report and ahead of tomorrow NFP and next week FOMC meeting. It is being supported also by rising optimism over the tax reform bill.
The aussie is been affected by lower commodity prices and data. Gold dropped today to $1251/oz, the lowest since August while the latest round of Australian economic data did little to help the aussie. Yesterday the GDP reading showed a negative surprise with consumption and today it was weaker trade data.
Technical levels
During the last hours, it had been moving in a small range below 0.7530 and above 0.7515. The technical outlook weakened significantly for the aussie. At current levels, it appears to be headed toward a test of 0.7500. Below the next support might be seen at 0.7485 (Feb low).
To the upside, the FXStreet's technical confluence indicator sees potential resistance at 0.7550, 0.7580, 0.7590 and 0.7610. In the short-term if it is able to recover 0.7550 it could remove some bearish pressure.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD hovers around 1.0700 ahead of German IFO survey
EUR/USD is consolidating recovery gains at around 1.0700 in the European morning on Wednesday. The pair stays afloat amid strong Eurozone business activity data against cooling US manufacturing and services sectors. Germany's IFO survey is next in focus.
GBP/USD steadies near 1.2450, awaits mid-tier US data
GBP/USD is keeping its range at around 1.2450 in European trading on Wednesday. A broadly muted US Dollar combined with a risk-on market mood lend support to the pair, as traders await the mid-tier US Durable Goods data for further trading directives.
Gold: Defending $2,318 support is critical for XAU/USD
Gold price is nursing losses while holding above $2,300 early Wednesday, stalling its two-day decline, as traders look forward to the mid-tier US economic data for fresh cues on the US Federal Reserve interest rates outlook.
Crypto community reacts as BRICS considers launching stablecoin for international trade settlement
BRICS is intensifying efforts to reduce its reliance on the US dollar after plans for its stablecoin effort surfaced online on Tuesday.
Three fundamentals for the week: US GDP, BoJ and the Fed's favorite inflation gauge stand out Premium
While it is hard to predict when geopolitical news erupts, the level of tension is lower – allowing for key data to have its say. This week's US figures are set to shape the Federal Reserve's decision next week – and the Bank of Japan may struggle to halt the Yen's deterioration.