The Aussie dollar dropped sharply over the course of the last trading week as interest rate
expectations on either side of the pair conspired to push it lower by around 4%. US rates got a shot
in the arm from the Fed’s Evans and talk from one of the major Australian banks of rate cuts from
the RBA and a general ‘risk off’ environment put an end to the Aussie recent run of good form. The
pair has rallied back off of lows just above 70 cents and traders are waiting from fresh impetus for
the next move.
Initial short-term topside resistance is coming in around 0.7100 at the moment but the longer-term
level reflects the pace of the move we’ve seen and is still up near 0.7290. Initial daily short-term
support is now at 0.7065 with the lower TL support coming in at 0.7020 and last week’s low at
On the longer-term daily chart, the Aussie is still in a upward trend. Initial trend line support comes in now around 0.7020 with the first fibo retracement line down below that at 0.6952. Topside there is a fair amount of space now with the trend line sitting around 0.7400 just below the yearly highs at 0.7414.