The AUD/USD pair managed to recover from the lows of the Asian session and is currently at the top of its daily trading range. The pair failed to take advantage of Friday’s positive rebound from two-month lows supported by a mixed monthly report on US jobs (NFP), and opened with a small bearish gap at the beginning of the new trading week amid another dismal China’s macro releases, showing that producer price inflation (PPI) remained at the same level of 0.1%, and the general consumer price index in February fell to 1.5%. This turned out to be one of the key factors affecting some downward pressure on the China-proxy Australian Dollar.
Despite the negative factor, the decline still softened against the background of a moderate price movement in US dollars, which continued to defend itself after disappointing employment data on Friday, which showed that the US economy added only 20 thousand new jobs in February compared to the expected 180K.
Market participants are now looking forward to today’s important release of monthly data on US retail sales for some significant impetus.
This combined with other key US macroeconomic data — the latest data on consumer inflation in the US on Tuesday and data on durable goods orders on Wednesday will now play an important role in determining the next stage of the pair’s movement
AUD/USD Technical Analysis
The Aussie dollar declined recently below the 0.7040 support level against the US Dollar. The AUD/USD pair found support near the 0.7000 area and later bounced back sharply.
The pair climbed above the 0.7020 resistance and the 50 hourly simple moving average. It even broke the 0.7040 level before sellers emerged near the 0.7050 level and a bearish trend line on the hourly chart.
The pair corrected lower, but it found support near the 0.7027 level, the 50 hourly SMA, and the 50% Fibonacci retracement level of the last wave from the 0.7002 low to 0.7052 high.
The current price action is positive and it seems like the pair is likely to climb above the 0.7040 and 0.7050 resistance levels in the near term. On the downside, the 0.7025 and 0.7020 levels are decent supports.