Yesterday the pair showed choppy trade and slightly strengthened for the day.
The Australian Dollar was supported by data on the AZN Job Advertisements that in January grew by 1.0% against a 0.1% decline in the previous month.
In addition, the USD remains under pressure amid lowered probability of interest rate hikes this year. Investors’ attention is focused on tomorrow’s Fed’s Yellen Testifies, where some clarification regarding further plans of the regulator might be given.
Support and resistance
Bollinger Bands on the daily chart is turning horizontally while the price range is narrowing. MACD is falling and giving a strong sell signal. Stochastic is also falling and approaching the oversold zone.
The indicators recommend waiting for clearer trading signals.
Support levels: 0.7000 (psychologically important level), 0.6981, 0.6936, 0.6900 (21 January low), 0.6875, 0.6850, 0.6826 (15 January low).
Resistance levels: 0.7045 (local high), 0.7068, 0.7100, 0.7128 (local high), 0.7158, 0.7183, 0.7200, 0.7241 (4 February high), 0.7259, 0.7282, 0.7300, 0.7327 (31 December high).
Long positions can be opened after the breakout of the level of 0.7065 (with the appropriate indicators signals) with the target at 0.7135 and stop-loss at 0.7020. Validity – 2-3 days.
Short positions can be opened after the breakdown of the level of 0.7030 with targets at 0.6985, 0.6940 and stop-loss at 0.7050. Validity – 2-3 days.