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AUD/USD Technical Analysis

Fundamental: AUD/USD pair has been trading at 1.045 and is looking to move up after the losses it suffered last week. Pressure on the US Dollar is affecting commodity currencies, which has brought the Australian Dollar down. USD has gained traction lately on positive economic data, and the chances of a monetary stimulus in the US have dimmed.

There is nothing significant on the economic calendar for AUD for the coming week, so all eyes are on the US Dollar.This week we’ll find out housing data, jobless claims and data on durable goods which should move the pair.

In the H4 timeframe, the pair has been moving in an upward channel since May. While its oscillations were fairly predictable between mid-June to the end of July, it became much wider since the start of August and seems to be trading downwards and sideways. The price has an immediate support level at 1.043, and if crossed, it could fall till the next support level at 1.0328, after which the channel would have been effectively broken and a shorting opportunity would begin. There is a bearish bias on pair so one must remain cautious for a breakthrough of the support level.

This bearish bias in H4 timeframe is confirmed by studying the MACD and Stochastic. MACDhas been bearish since the 7th of August, which corresponds with the price fall. It continues to be in the negative and a reversal doesn’t seem likely. The Stochastic indicator confirms the bias as it recently displayed a bearish signal. With the trending and the contrarian indicator pointing at the same direction,traders should look out for an opportunity soon .

The hourly timeframe shows the price movement in the month of August. The AUD/USD pair has been moving in a bearish channel, indicating that a downward trend may catch on to the 3H chart as well. It is likely that the price will touch the upper channel and then move downwards, but the trend line is to face some resistance in the near term as it is already hovering over the support level of 1.045. Looking at the RSI Indicator, we see a similar movement as the graph seems to hover at 50 for now.

Look out for news and breakouts in the near term as it may signal a trend, possibly a bearish one.

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