AUD/USD – Enjoys Support from Key 0.76 Level

AUD/USD – Tuesday 2 June 2015

The last few weeks have seen the Australian dollar fall sharply from a four month high above 0.8150 down to the key support level at 0.76.  This level has been a significant level for a couple of months and has propped the Australian dollar up on multiple occasions.  This recent price action has been a significant reversal as it wasn’t so long ago, the AUD/USD was in a solid medium term up trend having broken through the key 0.7850 level and achieved the four month high above 0.8150.

For most of this year the Australian dollar has traded within a wide trading range between the support at 0.76 and resistance around 0.7850.  Earlier this year in February that range was tighter with the support level higher at 0.77.  Throughout this period it experienced reasonable swings back and forth between the two key levels with very few excursions beyond the levels.

The key level presently remains 0.76 and it will be interesting to see how well the support at this level can hold up and stop the strong down trend the AUD/USD has experienced over the last few weeks.  The 4 hour chart below shows how steady the recent decline has been but equally how significant the 0.76 level in being able to temporarily halt the decline.

(Daily chart / 4 hourly chart below)

AUD/USD June 1 at 23:50 GMT   0.7610   H: 0.7668   L: 0.7598

AUD/USD Technical

During the early hours of the Asian trading session on Tuesday, the Australian dollar is finding support at the key 0.76 level after falling sharply from 0.7650.  Current range: trading right above 0.76.

Further levels in both directions:

• Below: 0.7600.

• Above: 0.7850 and 0.8150.

OANDA’s Open Position Ratios

(Shows the ratio of long vs. short positions held for 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 AUD/USD has increased to near 60% as the AUD/USD has eased back to the key support level of 0.76.  The trader sentiment is strongly in favour of long positions.

Economic Releases

• 23:30 (Mon) AU AIG Services PMI (May)
• 01:30 AU Current Account (Q1)
• 01:30 AU Net Exports of GDP (Q1)
• 04:30 AU RBA – Overnight Rate
• 08:30 UK BoE – Mortgage Approvals (Apr)
• 08:30 UK BoE – Net Consumer Credit (Apr)
• 08:30 UK BoE – Secured Lending (Apr)
• 08:30 UK CIPS/Markit Construction PMI (May)
• 08:30 UK M4 Money Supply (Apr)
• 09:00 EU Flash HICP (May)
• 09:00 EU PPI (Apr)
• 14:00 US Factory Orders (Apr)
• 14:00 US IBD Consumer Optimism (Jun)
• US Vehicle Sales (May)

* All release times are GMT

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