AUD/USD technical analysisClick for AUD/USD Current price
-Aussie recovers but the fundamental background leans the risk to the downside.
-Poor United States data could boost AUD/USD, but, it may be temporarily, equities behavior to weigh more.
The AUD/USD pair recovered the 0.7000 level in the US afternoon, settling a handful of pips above the level. The AUD/USD pair fell at the beginning of the day to 0.6775, its lowest in a decade, amid thin volumes exacerbating a brief round of panic selling after Apple issued a warning downgrading revenues amid tensions between the US and China. The recovery was partly due to a bounce in Wall Street from daily lows, but mostly due to broad dollar's weakness following tepid local data, as the December ISM Manufacturing Index, a first-tier factory gauge, fell the most in almost 10 years, spurring concerns about an economic slowdown.
Meanwhile, the 4 hours chart shows that the pair is pressuring a mild bearish 20 SMA in its 4 hours chart, while the larger ones maintain their bearish slopes above it. Technical indicators in the mentioned chart maintain their upward slopes but below their midlines, suggesting a limited upward potential. Much of Friday's direction will depend on how the market reads the US Nonfarm Payroll report. A key resistance is the 0.7070 price zone, as gains above the level should anticipate further gains ahead.
Support levels: 0.6980 0.6950 0.6920
Resistance levels: 0.7030 0.7070 0.7110
View Chart for the AUD/USD
Author: Valeria Bednarik