- AUD/USD witnessed some profit-taking on the last trading day of the week.
- The downside remains cushioned near the 0.7715-10 confluence support.
- The set-up favours bullish traders and supports prospects for further gains.
The AUD/USD pair edged lower on the last trading day of the week and eroded a part of the previous day's positive move to four-week tops. The pair was last seen trading just below mid-0.7700s, down 0.15% for the day.
Mixed Chinese economic releases seemed to be the only factor that prompted some profit-taking around the China-proxy aussie. That said, a softer tone surrounding the US dollar extended some support to the AUD/USD pair. Apart from this, the prevalent risk-on mood further collaborated to limit the downside for the perceived riskier Australian dollar.
Looking at the technical picture, the AUD/USD pair stalled this week's solid rebound from sub-0.7600 levels just ahead of a resistance marked by the 50% Fibonacci level of the 0.8008-0.7531 downfall. The pullback, however, lacked any strong follow-through and the pair, so far, has managed to hold above the 50-day SMA/38.2% Fibo. confluence region.
The mentioned support is pegged near the 0.7715-10 region, which should now act as a key pivotal point for short-term traders and help determine the next leg of a directional move for the AUD/USD pair. Given that oscillators on the daily chart have just started moving into the positive territory, the bias seems tilted in favour of bullish traders.
However, it will still be prudent to wait for a sustained move beyond the 61.8% Fibo. level, around the 0.7765-70 region before positioning for any further appreciating move. The AUD/USD pair might then aim to surpass the 0.7800 mark and test the 61.8% Fibo., around the 0.7825-30 area, which is closely followed by March swing highs near mid-0.7800s.
On the flip side, weakness below the 0.7715-10 confluence resistance-turned-support should now be seen as a buying opportunity. This should help limit the downside near the recent trading range breakpoint, around the 0.7665-60 region. Only a sustained break below the latter will negate the positive bias and prompt some technical selling.
AUD/USD daily chart
.png)
Technical levels to watch
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 drops to near 1.0850, further support at nine-day EMA
EUR/USD continues to lose ground, trading around 1.0860 during the Asian hours on Friday. From a technical perspective on a daily chart analysis indicates a sideways trend for the pair as it continues to lie within the symmetrical triangle.
GBP/USD posts modest gains above 1.2650, focus on the Fedspeak
The GBP/USD pair posts modest gains near 1.2670 during the Asian session on Friday. Meanwhile, the USD Index recovers some lost ground after retracing to multi-week lows near 104.00 in the previous session.
Gold price gains ground, with Fed speakers in focus
The Gold price trades with a positive bias on Friday. The bullish move of precious metals in the previous sessions was bolstered by the softer-than-expected US inflation data in April, which triggered hope for rate cuts from the US Fed.
LINK price jumps 10% as Chainlink races toward tokenization of funds
Chainlink price has remained range-bound for a while, stuck between the $16.00 roadblock to the upside and $13.08 to the downside. However, in light of recent revelations, the token may have further upside potential.
Fed speak tempers rate cut expectations
The biggest takeaway into Friday is the latest round of Fed speak. These Fed officials reiterated their stance rates should be kept restrictive for a longer period of time until there is more clear evidence inflation is heading back towards the 2% target.