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The FxPro Analyst Team

Forex: AUD/USD Bull Nears Mid-Term Major Resistance Zone

AUD/USD has turned bullish since early January, as a result of the retracement of the dollar and the rebound of commodity prices. The Aussie has been one of the best currency performers year to date.

The Reserve Bank of Australia (RBA) announced the rates remain unchanged at a record low of 1.5%
On 7th Feb, implying the rates would remain on hold in the short term.

The current price is still trading above the downside near- term major uptrend line support.

However, the price has retraced on 16th and 17th Feb, after testing the mid-term major resistance level at 0.7700.

The mid-term major resistance zone lies between 0.7720 – 0.7800, where the selling pressure is heavy, be aware that the bullish attempt is likely to be restrained at this zone.

On the 4-hourly chart, the 10 SMA is crossing over the 20 SMA downward, suggesting waned bullish momentum.

The daily Stochastic Oscillator is crossing over from above, suggesting a pullback.

The resistance level is at 0.7685, followed by 0.7700 and 0.7720.
The support line is at 0.7660, followed by 0.7640 and 0.7620.

The Reserve Bank of Australia (RBA) will release the meeting minutes at 00:30 GMT on Tuesday 21st, followed by RBA’s Governor Phillipe Lowe’s speech at 21:30 GMT. Keep an eye on the content of the minutes and the speech, as it will likely influence the strength of the Aussie.

The US PMI figures for Feb, will be released at 14:45 GMT this Tuesday (Feb 21), including Markit Manufacturing, Services and Composite PMIs. It will likely influence the strength of the dollar and the dollar crosses.

With better-than-expected numbers, it will likely weigh on AUD/USD and test supports.
With lower-than-expected numbers, it will likely push AUD/USD up and test resistances.

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