Australian dollar has been trading in the downward range against USD for two months due to the fall of the Australian currency and the growth of demand for US dollar . AUD felt considerable pressure due to the fall of investors' interest after the decision of RBA to keep the unchanged. At the same time the oversold US currency was supported by strong data on the labor market and key indexes. Moreover, the demand for US dollar grew due to the position of FOMC aimed at further winding up of the program for the stimulation of the economy and gradual increase of interest rates.
In the beginning of the previous week the pair continued to fall because of negative data on the Australian retail sales and construction sector. However, by the middle of the previous week an upward correction wave started to form. It got even stronger after the release of weak and retail sales data from the USA.
During the current week special attention should be paid to the data on the industrial output and labor market in the USA. Australian releases include main indexes, unemployment rate, and the minutes of the recent RBA meeting.
Support and resistance
Currently the forecast remains unchanged – short positions in the trend. Indicators on the D1 chart confirm it: shows the preservation of the high of short positions, and are directed downwards. An alternative scenario will be movement to wide lateral consolidation which is typical for AUD/USD .
Support levels: 0.7370, 0.7350, 0.7300, 0.7240, 0.7225, 0.7150, 0.7100, 0.7030.
Resistance levels: 0.7440, 0.7475, 0.7490, 0.7550, 0.7610, 0.7680, 0.7745.
Short positions may be opened from the current level or the upper border of the at 0.7475 with stop-loss 0.7495. One may lock in profits at 0.7300.