AUD/USD outlook: Australian Dollar falls on weak economic data

Slobodan Drvenica Windsor Brokers

AUD/USD

AUDUSD fell to one-week low on Tuesday, falling 1% until early US session, deflated by fall in iron ore and unexpected widening of Australia’s current account gap, while US manufacturing sector performed in August slightly better than previous month, adding to fresh optimism and lifting the US dollar.

Fresh weakness is generating initial reversal signal on daily chart, after the price emerged from recent six-day consolidation range.

Break below 10DMA (0.6765) and subsequent acceleration, is pressuring initial Fibo support at 0.6711 (23.6% of 0.6348/0.6823), loss of which to reinforce negative signal, with near-term bias to remain with bears while the price stays below broken 10DMA.

South-heading momentum indicators add to weakening outlook and show space for deeper pullback and expose a cluster of MA’s at 0.6690/15 zone.

Today’s close will in focus and expected to provide better signals however, traders await releases of key US labor report (JOLTS, ADP, NFP) which will be released in coming days and shed more light on the situation in US labor sector – one of key signals for Fed ahead of policy meeting, due later this months

Res: 0.6765; 0.6794; 0.6812; 0.6823.

Sup: 0.6694; 0.6642; 0.6613; 0.6586.

Interested in AUD/USD technicals? Check out the key levels

1. R3 0.6851
2. R2 0.6822
3. R1 0.6767
PP 0.6737
1. S1 0.6682
2. S2 0.6653
3. S3 0.6598

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

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