Trading news

AUD/USD: The pair will continue upward movement

Current trend

Last Thursday the currency pair AUD/USD had significantly strengthened after release of Australian labour market data. It became known that both employment and unemployment rates were above market’s expectations. Unemployment remained at the previous level of 5.8% against expectation of growth up to 5.9%, while the number of jobs rose by 14.2 thousand against the forecast of 8 thousand.

Following the release of this statistic the price of the pair had reached the four-week highs at the level of 0.9394, but later the price underwent correction to the level of 0.9355 (moving average of Bollinger bands).

It is likely that movement in the pair will be volatile today. Investors will wait for the draft budget of Australia for 2014-2015, which will be released on Tuesday. It is expected that in the next fiscal year tightening of monetary policy will be introduced, and number of benefits for the taxpayers will be cancelled.

Levels of support and resistance

Currently, the price has pushed off from the level of 0.9355, which suggests the rise up to the level of 0.9380 and 0.9395 (upper moving average of Bollinger bands). In case of breakdown of the level of 0.9395, the price can go further up to 0.9425.

Technical indicators give mixed signals. MACD histogram is in the positive zone, its volumes are decreasing. Stochastic lines intersect,turning upward.

Trading tips

In the current situation it makes sense to open long positions from the current level of price with take profit at 0.9395. Short positions with the target of 0.9320 can be opened if the price falls to the level of 0.9355.

 

Dmitry Zolotov

Analyst of LiteForex Investments Limited

Monday, 12 May, 2014 / 10:08

Source : http://www.liteforex.com/

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