Australian Dollar Technical Forecast
- Is AUD/USD about to end its choppy trading dynamic?
- AUD/NZD dominant downtrend over, outlook bullish
- GBP/AUD overshadowed by conflicting price signals
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Looking for a fundamental perspective on AUD? Check out the Weekly AUD Fundamental Forecast.
AUD/USD Technical Outlook:Neutral
The Australian Dollar has been trading in a choppy range against the US Dollar in the aftermath of its decline in early February. AUD/USD may soon however find itself running out of room to consolidate as it approaches the border of two intersecting lines on the 4-hour chart below. Descending resistance goes back to late January and rising support from the early phases of March.
Negative RSI divergence, showing fading upside momentum,hints that perhaps the Aussie is due for another retest of support after failing to breach resistance this past week. Confirmation is always key when it comes to breakouts. In the event of one lower, keep an eye on the psychological barrier just above 0.7050. Otherwise, should the pair climb above the descending trend line, the next area of resistance seems just under 0.72069.
AUD/USD 4-Hour Chart
AUD/NZD Technical Outlook:Bullish
Against the New Zealand Dollar, AUD has made an impressive bullish push these past few weeks. We haven’t seen such consistent aggressive behavior since the end of June 2018. Fundamentally this has come in the aftermath of a dovish RBNZ, which hinted that it sees chances of a cut as the more likely next move. The focus for this pair is arguably respective monetary policy bets as a ‘risk-neutral’ currency pair.
On the daily chart below, the result of this has been a breakout through the well-defined falling trend line from August. With much confirmation at this point, the dominant downtrend since then appears to be over. From here, near-term resistance is a range between 1.0639 and 1.0670. Immediate support seems to be at 1.05439. For more updates on the Australian Dollar, feel free to follow me on twitter here @ddubrovskyFX.
AUD/NZD Daily Chart
GBP/AUD Technical Outlook: Neutral
Looking at the British Pound next, there appears to be conflicting price signals in GBP/AUD. On the one hand, the pair has broken under a rising trend line from December. Though this is not quite with the same enthusiasm as the upside breakout in AUD/NZD. On the other hand, a falling wedge, which is a bullish signal, seems to be undermining the descent through the upward-sloping support line.
Hesitation here may be because of the ongoing Brexit saga which is clouding the fundamental outlook for Sterling. As such, significant technical progress in GBP should be treated with a grain of salt. If the bullish price signal prevails, clearing the ceiling of the wedge exposes 1.8732. Otherwise, ending the dominant uptrend from the end of last year opens the door to testing 1.79916.
GBP/AUD Daily Chart
* Charts created in TradingView
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— Written by Daniel Dubrovsky, Junior Currency Analyst for DailyFX.com
To contact Daniel, use the comments section below or @ddubrovskyFX on Twitter