This week the pair has been trading within the range of 0.9483-0.9386. Today however the “aussi” experienced high volatility of the market and hit local highs at 0.9471. The rise was caused by the favourable releases of unemployment data in Australia. Inevitable decrease down to the level of 0.9387 followed the rise. The Dollar was strengthened due to the Janet Yellen’s appointment as a new Head of FRS of USA. Investors hope that new Head will at last cancel the quantitive easing programs. Meanwhile the Dollar is still under pressure of the US budget crisis, and Australian currency has all the chances to regain its positions.
Support and resistance
The pair is trading now around key level of 0.9430 (middle MA of Bollinger Bands indicator). If the price consolidates above this level the pair will go all the way up to the levels of 0.9470 (upper MA of Bollinger Bands) and 0.9515. Otherwise the fall down to the level of 0.9395 is probable.
Technical indicators give us controversial signals. MACD histogram is in overbought zone, its volumes are decreasing. Stochastic lines can soon cross and reverse upwards, giving a signal to buy.
Regarding the situation it is recommended to open long trades at 0.9440 with targets at 0.9515. Short positions can be placed at the level of 0.9420 with Take Profit orders around 0.9395.
Analyst of LiteForex Group of CompaniesPublication source