The Aussie has climbed back above its psychological .90 level and is testing previous March highs as the risk trade rallies in reaction to better than expected U.S. employment data. The Aussie is enjoying the development in particular since the RBA just raised rates again and Australia’s economic data has been altogether solid. The Aussie has broken above our key 2nd tier downtrend line again in the process. Our 2nd tier runs through the .92 level. Hence, a confirmation through our 3rd tier downtrend line could signal a more lasting near-term rally towards the .92 area. Meanwhile, we recognize strong price action in gold and the USD/JPY, positive developments for the risk trade as well. Data is done for the week, meaning the remainder of the trading session will likely feed off of today’s U.S. employment figures barring any psychological developments. Australia will kick off next week with job advertisements and business confidence data. However, the more influential releases will likely be Chinese new loans and trade balance data along with Australia’s home loans figure due Wednesday. For the time being it will be interesting to see if the Aussie can break through previous March lows and solidify.
Technically speaking, the Aussie has multiple uptrend lines serving as technical cushions along with intraday and 3/3lows. We’ve kept our trend lines intact to give investors an idea of the relevance of today’s topside movement. As for the topside, the Aussie has multiple downtrend lines serving as technical barriers along with March highs and the highly psychological .90 area.
Price: .9081
Resistances: .9090, .9104, .9120, .9134, .9146, .9160
Supports: .9072, .9054, .9038, .9021, .9008, .8993
Psychological: .90, March highs and lows
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