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AUD/USD Rebound Approaching Key Resistances

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Aayush Jindal

Key Highlights

  • The Aussie Dollar started a decent rebound fromthe 0.6865 support against the US Dollar.
  • AUD/USD traded above a key bearish trend line at0.6885 on the 4-hours chart.
  • The US Consumer Confidence in May 2019 increasedfrom 129.2 to 134.1.
  • The Richmond Fed Manufacturing Index in May 2019could rise from 3 to 6.

AUDUSD Technical Analysis

After a solid decline, the Aussie Dollar found support near 0.6865 against the US Dollar. A support base was formed and the AUD/USD pair started a decent recovery above the 0.6900 level.

AUDUSD Technical Analysis Aussie Dollar US Dollar

Looking at the 4-hours chart, the pair tested the 0.6865level on multiple occasions and finally started an upward move. It broke thekey 0.6880 and 0.6900 resistance levels to start a short term rebound.

Moreover, there was a break above a key bearish trend lineat 0.6885. The pair tested the 38.2% Fib retracement level of the downward movefrom the 0.7048 high to 0.6864 low.

However, the pair is now facing a lot of hurdles near the0.6940 and the 100 simple moving average (4-hours). The main resistance is nearthe 0.6960 and the 50% Fib retracement level of the downward move from the0.7048 high to 0.6864 low.

If there is a successful close above the 0.6960 level, thepair could climb further higher towards the 0.7000 or 0.7040 level. Conversely,if there is no upside break above 0.6960, the pair might decline again andrevisit the 0.6880 or 0.6865 support.

Fundamentally, the US Consumer Confidence for May 2019 wasreleased by the Conference Board. The market was looking for an increase from129.2 to 130.1.

The actual result was better, as the Confidence Indexincreased to 134.1. Moreover, the Present Situation Index increased from 169.0to 175.2.

The report added:

The Expectations Index – based on consumers’ short-termoutlook for income, business and labor market conditions – increased from 102.7last month to 106.6 this month.

Looking at GBP/USD, the pair remains in a strong downtrend, while EUR/USD is still struggling to clear the 1.1225 resistance level.

Economic Releases to Watch Today

  • Germany’s Unemployment Change May 2019 -Forecast -8K, versus -12K previous.
  • Germany’s Unemployment Rate May 2019 – Forecast 4.9%,versus 4.9% previous.
  • Richmond Fed Manufacturing Index May 2019 –Forecast 6, versus 3 previous.
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