Despite the Australian economy is currently going through difficult times, the RBA decided to keep the interest rate at 2% earlier today. After the decision, 10-year Australian government bonds’ yield grew, while the AUD/USD pair gained almost 60 points.
However, today’s data on the Australian trade balance for August showed a big drop and amounted to -3.095 billion Australian Dollars against the previous -2.792 billion (forecasted -2.55 billion), which suggests that a further AUD decline is likely.
Support and resistance
The price remains near the strong resistance level at 0.7115 (ЕМА200 on the 4-hour chart).
An upward correction in the pair could continue to the level of 0.7170 (ЕМА50 on the daily chart), while a breakout and consolidation above the level of 0.7270 could start a short-term upward trend towards the level of 0.7500 (23.6% Fibonacci correction and ЕМА144 on the daily chart).
OsMA and Stochastic on the 4-hour and daily charts signal purchases, but remain bearish on the weekly and monthly charts.
Support levels: 0.7035, 0.6960, 0.6910.
Resistance levels: 0.7115, 0.7170, 0.7200, 0.7270.
Long positions can be opened after the breakout of the level of 0.7135 with targets at 0.7180, 0.7200 and stop-loss at 0.7115.
Short positions can be opened after the price consolidation below the level of 0.7110 with targets at 0.7060, 0.7030 and stop-loss at 0.7130.