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AUD/USD Upward Channel Extends Support - Trade Plan! 

EagleFX

The AUD/USD pair was closed at 0.70067 after placing a high of 0.70334 and a low of 0.69692. Overall the movement of AUD/USD pair remained bullish throughout the day. The AUD/USD pair edged higher on Wednesday and extended its previous day's gains reached the highest level since 10th June due to increased risk sentiment and broad-based US dollar weakness.

On Wednesday, the Westpac Consumer Sentiment came in as -6.1% in July against the 6.3% of June. Despite this disappointing data from Australia, the positive news related to the vaccine hopes continued pushing AUD/USD pair on the higher side after increasing optimism and risk sentiment.

On the virus front, after the lockdown in Australia's most populous state, the number of appearing cases from Australia showed a decline, which helped to push Aussie against the dollar a bit. As in result, AUD/USD pair gains were extended.

On the other hand, the US dollar was under pressure throughout the day due to increased market risk sentiment after US President Donald Trump announced that he had signed the Hong Kong Autonomy Act. This statement by Trump raised risk sentiment in the market and weighed on the US dollar. The US dollar index dropped below 96 levels.

However, in response to this, the Chinese foreign ministry said that it strongly condemns and opposes the US to move to pass the Hong Kong Autonomy Act. It also announced to retaliate strongly against the US legislative who passed the bill. This also helped AUD/USD pair to gain traction in the market and post gains.

On the US front, the US's data came in support of local currency but failed to drag the pair AUD/USD on the down track as risk appetite continues to support the currency pair.

On Thursday, the Aussie employment numbers and the unemployment rate will be under observation by the Australian Dollar traders. While from China, the GDP numbers will remain under focus by the traders to find more clues about the pair's movement. The US-China tensions might cap the gains if further escalated.


Daily Technical Levels

Support Resistance

0.6971 0.7041

0.6935 0.7075

0.6901 0.7112

Pivot point: 0.7005

The AUD/USD pair is testing the support level around 0.6985 level, along with resistance at 0.7040 level. Bullish crossover of 0.7040 level can extend buying until the next target level of 0.7067 level. The RSI and MACD are suggesting bullish bias in the market. Recently, the AUD/USD is trying to form a Doji pattern on the four hourly charts, and the closing of this candle could drive the buying trend in the AUD/USD pair and lead it towards the next target level 0.7030 level today. Besides, the support stays at 0.6925 and 0.6850 level. Good luck!

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