AUD/USD Continues To Place Pressure On Resistance Level At 0.93
Stuart McPhee | Jul 24, 2013 12:27AM ET
In a positive sign the AUD/USD has maintained its price level well above 0.92 as it is now presently placing upward buying pressure on the resistance level at 0.93. After a solid start to last week, the AUD/USD finished out last week just easing back a little under 0.92 after being turned away from the resistance level at 0.93 again. After finding solid support at 0.90 a week or so ago, it did well to rally moving up above 0.92 for the first time in nearly a week and getting to within a whisker of 0.93 again. The 0.93 level has provided reasonable resistance to any movement higher just like it did a couple of weeks ago and it is doing so again presently. To finish a couple of weeks ago, it dropped sharply again to resume its medium term down trend as it moved down towards the key long term level of 90 cents. It surged higher to within a whisker of the 93 cents level before falling away to close out the week.
The 0.9150 level had become a key level over the short term providing both some resistance and more recently support, and this has been called upon again in the last couple of days providing some much needed support. It was only a couple of weeks ago that many were waiting for the AUD/USD to break below the 90 cents level and then it would have been a matter of how far can it drop. It had continued to drift lower and move towards the 90 cents level, a level not seen for three years. Considering the speed of its decline over the last few months, the last few weeks has seen a significant slowing down and almost some consolidation as it has rested well on the support at 0.90 and made its way back to 0.93 on a few occasions.
The last few months have seen the AUD/USD establish a strong medium term down trend with lower peaks and lower troughs, as it has moved from near 1.06 down to near 0.90 in that time. In doing so, it has completely ignored any likely support at either 1.04 or 1.0360, and more recently the long term support level at 0.97. Up until mid April, the Australian dollar was enjoying its best move higher since October and November last year. After making a solid run higher in the middle of June back towards the key level of 0.97, the AUD/USD has since continued its strong and steady decline moving to within reach of 0.90 and levels not seen since near the middle of 2010. This has seen it experience a significant strong trend that would have caught many people on the wrong side of.
In economic releases, it feels like summer, with only two releases on Tuesday both out of the US. Australia will release CPI, one of the most important economic indicators, early on Wednesday. This inflation index is considered one of the most important indicators, and could result in the pair breaking out from its current drifting. On Monday, US Existing Home Sales was a disappointment dropping from 5.18 million to 5.08 million. This surprised the markets, which had anticipated a strong showing of 5.27 million.
Get The News You Want
AUD/USD July 24 at 00:20 GMT 0.9297 H: 0.9299 L: 0.9222
During the early hours of the Asian trading session on Wednesday, the AUD/USD is placing pressure on the resistance level at 0.93 after its solid run from down near 0.9230 in the last 12 hours. Despite its slowing down the last couple of weeks, the Australian dollar has been in the middle of a free-fall, as the currency has lost around 13 cents since the beginning of May. In moving through to 1.0580 only a few months ago, it moved to its highest level since January. Current range: trading just below 0.9250.
Further levels in both directions:
• Below: 0.9150 and 0.9000
• Above: 0.9300
(Shows the ratio of long vs. short positions held for the AUD/USD among all OANDA clients. The left percentage (blue) shows long positions; the right percentage (orange) shows short positions.)
The long position ratio for the AUD/USD has drifted back a little under 70% as the Australian dollar has moved through 0.92. The trader sentiment remains in favour of long positions.
Economic Releases
- 01:00 AU Internet Skilled Vacancies (Jun)
- 01:30 AU CPI (Q2)
- 07:58 EU Flash Composite PMI (Jul)
- 07:58 EU Flash Manufacturing PMI (Jul)
- 07:58 EU Flash Services PMI (Jul)
- 10:00 UK CBI Industrial Trends (Jul)
- 12:58 US Flash Manufacturing PMI (Jul)
- 14:00 US New Home Sales (Jun)
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.