AUD/USD – Thursday 16 July 2015
The Australian dollar has fallen sharply over the last few weeks which has culminated in a new six year low near 0.7350 in recent hours. For the best part of the last two weeks the AUD/USD has traded in a narrow range between 0.74 and 0.75 with the former providing reasonable support and the latter providing stiff resistance during this time. It had been relying upon support at 0.74 and testing this level however this has now been broken in the last 24 hours. A couple of weeks ago the Australia dollar was starting to feel some selling pressure from the 0.77 level and it had its eyes firmly focused on the long term support level at 0.76. A few weeks ago the AUD/USD fell sharply lower below 0.77 however it found solid support from the long term support level at 0.76. This level has provided solid support throughout most of this year so it is quite significant that it has now been strongly broken.
In the first half of June the Australian dollar surged higher from below 0.77 up to a three week high, however it ran straight into resistance at the key 0.7850 level, which has performed this role several times this year. Throughout this time it also spent most of its time trading quite steady around the 0.7750 level whilst receiving solid support from 0.77. Over the last couple of months the resistance level at 0.7850 has played a major role and continues to place selling pressure down on the AUD/USD. Throughout this same period it has been enjoying rock solid support from the long term support level at 0.76 which has allowed it to rebound strongly back up to above 0.78 on more than one occasion.
Throughout the second half of May 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.
(Daily chart / 4 hourly chart below)
AUD/USD July 16 at 02:50 GMT 0.7363 H: 0.7389 L: 0.7354
AUD/USD Technical
| S3 | S2 | S1 | R1 | R2 | R3 |
| — | — | — | 0.7500 | 0.7850 | 0.8150 |
During the early hours of the Asian trading session on Thursday, the Australian dollar is easing back towards the six year low near 0.7350. Current range: trading right around 0.7360.
Further levels in both directions:
• Below:
• Above: 0.7500, 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 moved back below 60% as the AUD/USD has eased further to a six year low near 0.7350. The trader sentiment is in favour of long positions.
Economic Releases
- 09:00 EU HICP (Jun)
- 09:00 EU Trade Balance (sa) (May)
- 11:45 EU ECB – Interest Rate
- 12:30 US Initial Claims (11/07/2015)
- 13:30 EU ECB’s Draghi gives press conference following rate announcement
- 14:00 US NAHB Builders survey (Jul)
- 14:00 US Philadelphia Fed Survey (Jul)
- 20:00 US Net Long-term TICS Flows (May)