Review and dynamics
Since mid-January when the pair was at the level of 0.6835, AUD/USD has grown by 14% up to the level of 0.7820, which was reached in the second half of April. The level of 0.7820 is crossed by Fibonacci 38.2% to the last wave of decline since July 2014.
Significant rise in the national currency started to worry exporters, while RBA was the only large world’s bank, which did not introduce monetary policy easing.
After the decision to decrease interest rate the pair AUD/USD by 2% today. Volatility in the pair was over 160 points. The decline in the pair was stopped by support level of 1.7560 (ЕМА50 on the daily chart).
However, many economists and market participants believe that the pair AUD/USD can regain positions and resume growth. This opinion is based on the following facts: the US Fed has not indicated possibility of the interest rate increase in the USA, commodity prices, including iron ore, are growing. Note that iron ore is the main item of Australian export.
Despite today’s decline the pair AUD/USD remains in the upward channel on the daily chart with the upper limit at the level of 0.7900 (Highs of February and March 2015).
On the other hand, on the weekly and daily chart the indicators OsMA and Stochastic give signals for opening short positions.
Consolidation of the price below the level of 0.7560 can trigger further decline to support levels of 0.7500, 0.7445 (ЕМА200 on the daily chart and Fibonacci 23.6%). Breakout below the levels of 0.7365 and 0.7330 may bring the pair AUD/USD back to the downtrend.
The rise in the pair may happen if the price consolidates above the level of 0.7605 (ЕМА200 on 4-hour chart and the lower limit of the ascending channel on the daily chart).
If price goes back to the level of 0.7725 (the highs of today and March) the pair will resume the rise to 0.7820. In case of breakdown of this level the pair will go up to 0.7900 and 0.8130 (ЕМА144 on the daily chart and Fibonacci 50%).
Support levels: 0.7560, 0.7500, 0.7445, 0.7365, 0.7330 and 0.7300.
Resistance levels: 0.7680, 0.7720, 0.7820 and 0.7900.
Sell Stop: 0.7540. Stop-Loss: 0.7590. Take-Profit: 0.7500, 0.7445, 0.7365, 0.7330 and 0.7300. Buy Stop: 0.7620. Stop-Loss: 0.7550. Take-Profit: 0.7720, 0.7820, 0.7900, 0.8000 and 0.8130.
Rebound from support level of 0.7560
The pair remains in the upward channel