AUD/USD offered at 1hr 50-SMA, slips below 0.7200

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Feb 24, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    The AUD/USD pair extends losses below 0.72 handle in early-Asia, reversing a spike to hourly 50-SMA located at 0.7212.

    AUD/USD tracks stocks, oil lower

    Currently, the AUD/USD pair trades -0.17 lower at fresh session lows of 0.7192, on its way to test Tuesday’s low of 0.7186. The Aussie is seen struggling to take on the recovery beyond 0.72 handle as the extension of losses in most major Asian indices alongside oil continues to weigh on the sentiment around the higher-yielding asset AUD. Australia’s ASX 200 is down -1.35%, while the Nikkei 225 drops -0.68%.

    In addition, the latest set of the Australian economic data disappointed markets, which further collaborated to the weakness in the AUD/USD pair. Total construction work plunged 3.6% in the December quarter after sliding a revised 1.8% previously and missed estimates of a 2.1% drop. Also, the Q4 wage price index slid 0.5% versus 0.6% expected.

    Moreover, broad based US dollar strength following mixed US data released yesterday, keeps a lid on the prices. Looking ahead, focus now remains on the US services PMI and new home sales data ahead of the crucial Aus capex figures due tomorrow.

    AUD/USD Levels to watch

    The pair finds the immediate resistance at 0.7247/50 (Feb 22 High/ round number) above which gains could be extended to the next hurdle located at 0.7288 (Daily R2). On the flip side, the immediate support located at 0.7182/75 (5-DMA/ 1h 100-SMA). Selling pressure is likely to intensify below the last, dragging the Aussie to 0.7138/33 (100 & 20-DMA).
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