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The FxPro Analyst Team

FxPro Forex Analysis: Australian Dollar Pressured By Commodity Prices

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The Australian Dollar was pressured by sellers overnight and during early trading in London on Tuesday, as markets responded to a sharp fall in iron ore prices. Prices of iron ore, Australia’s largest export, are a perpetual source of risk for the currency. The U.S. imposed tariffs on imported washing machines and solar panels sparked fears of a global trade war. This is expected to heavily affect manufacturers in China and fluctuations in Chinese demand can have a significant impact on the Australian economy.

AUDUSD

The uptrend in AUDUSD since December found strong resistance at 0.8320. As seen on the 4-Hourly chart, the pair has failed to break the level on a number of attempts and is due to test trend line support. A break through the trend line at 0.7950 could lead to a deeper decline with support evident at 0.7934 and then 0.7900. On the upside, any recovery attempts might find supply near the 0.800 handle and then at 0.8040.

AUDUSD 4-Hour Chart

AUDUSD 4-Hour Chart

AUDNZD

The Aussie weakness was evident in the AUDNZD cross, which has been gathering solid momentum to the downside. In the 4-Hourly timeframe, the pair turned lower from the October resistance trend line and is now finding near-term support at 1.0870. A break would lead to a move to 1.0850, followed by trend line support at 1.0830. A reversal and close above resistance at 1.0895 is needed to see a recovery to 1.0920.

AUDNZD 4-Hour Chart

AUDNZD 4-Hour Chart