AUDUSD, JPY, CAD – Rate Settings:
- Australian dollars She looks weak as she tests vital support.
- The main focus is on retail sales in Australia and primary in the United States PCE data tomorrow.
- any way to Australian dollar / US dollarAnd Australian dollar / Japanese yenand AUD/bastard?
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The Australian dollar looks vulnerable as it tests key support against the US dollar, a breakout that could lead to more losses in the near term.
The Australian dollar has been hit by a combination of factors recently: a setback in risk sentiment amid the lack of meaningful progress in Washington on raising the debt limit, diminished interest rate cut expectations after hawkish talk from US Federal Reserve officials, and disappointing Australian data. (The job data is the most recent).
This puts increased focus on Australian retail sales data for April due on Friday – it is expected to slow to 0.1% m/m from 0.4% previously, and a lower-than-expected reading could send the Aussie lower. Also, a higher than expected US core PCE price index (expected to hold steady at 4.6% yoy) could boost the US dollar.
Daily chart of the Australian dollar / US dollar
Chart by Manish Gradi using TradingView
AUD/USD: Threatening to break lower
AUD/USD is trying to breach the crucial support on the horizontal trend line from November at around 0.6585. Such a break could initially open the way towards 0.6350, based on the width of the side channel. Most importantly, such a move would invalidate the bullish outlook outlined in “Aussie Dollar Pre-Budget: AUD/USD, AUD/JPY, EUR/AUD Price Setup,” published on May 9. A barrier at 0.6805 to dispel the bearish pressure.
Daily chart of the Australian dollar / Canadian dollar
Chart by Manish Gradi using TradingView
AUD/CAD: cracks below support
AUD/CAD’s drop below the horizontal trend line from April at around 0.8950 has created a minor double top (April and May tops), which could present downside risks towards 0.8800. The downward development follows the failure to cross above the severe resistance at the 89-day moving average (see daily chart).
Daily chart of the Australian dollar / Japanese yen
Chart by Manish Gradi using TradingView
Australian Dollar / Japanese Yen: The uptrend is capped
AUD/JPY risks turning lower as it tests a strong convergence barrier at the 200-day moving average, which roughly coincides with February’s high of 93.00. Any break below 90.00-90.25 will raise chances of a continuation of the wide range, which is entrenched at 86.00-93.00.
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– Posted by Manish Grady, Strategist for DailyFX.com
Connect with Jaradi and follow her on Twitter: @JaradiManish