- AUD/USD is treated near the 0.6270 region and cannot recover the ground in the middle of the permanent USD power.
- A soft Australian labor market report and a safe demand for the US dollar continue to focus on Aussie.
- As the dual key remains below the average movement, the technical indicators indicate even more negatively.
The AUD/USD pair remained depressed as a stronger US dollar (USD) under the 0.6300 barrier during the American session, and continued to weigh the disappointing employment data from Australia. As the indicators worsens and the price action between the significant average movement, technical signals are gradually returned.
Daily Digest market carriers: While the US dollar remains intact, the Australian dollar softened.
- The Australian dollar (AUD) was extended for a second session on Friday, which was suppressed by both external and domestic drivers.
- The publication of a disappointing Australian job report, which shows that the economy was far below 52.8 thousand positions in February, has created new concerns about the weakness of the labor market.
- The US dollar was directed by the expectations that the Federal Reserve (FED) would increase interest rates for a longer period of time following higher inflation projections in the last summary of economic projections.
- Although the Fed held its policy unchanged, the updated tone leaned over and provided a elevator to Greenback.
- The continuous uncertainty on geopolitical tensions and the US trade policy was added to the use of safe-to-use of the US dollar.
- US President Donald Trump’s comments on potential new tariffs and retaliation trade measures, considering the fact that Australia was exposed to severe trade to China, kept investors in particularly affecting risk -sensitive currencies such as Aussie.
- From the perspective of domestic monetary policy, weak employment data increases the likelihood of more relaxation than the Australian Reserve Bank (RBA). In February, RBA had reduced rates by 25 basis points, and if analysts continue to disappoint economic data, additional convenience points up to 75 base can be guaranteed.
AUD/USD Technical Analysis: Negative momentum deepens with the key levels violated
The AUD/USD pair approached the 0.6270 support zone at the American session on Friday and continued to move lower with the decline pressure that dominated the day. The double remains below the simple moving averages of 20 days and 100 days, and the deterioration confirms the technical structure.
While the moving average convergence deviation (MACD) indicator presses a new red rod, the relative force index (RSI) fell sharply to 44, remaining in the negative area. Both signals indicate the disadvantage of the momentum that continues to support.
In terms of key levels, emergency support is around 0.6250 and the following break may trigger a decrease to more than 0.6200. On the up side, the resistance is close to 0.6310, then a more important barrier in 0.6340, where the couple may face sales pressure.
Australian dollars FAQ
One of the most important factors for the Australian dollar (AUD) is the interest rates determined by the Australian Reserve Bank (RBA). Since Australia is a rich country in terms of welding, another key drive is the price of the biggest export, iron ore. The health of the Chinese economy, the largest trade partner, is inflation, growth rate and trade balance in Australia. Market sensation-whether it is a risky factor for AUD at the same time, whether they receive more risky assets (risky) or seek safe-life (risk-off).
The Australian Reserve Bank (RBA) affects the Australian dollar (AUD) by determining the level of interest rates that Australian banks may lend to each other. This affects the level of interest rates in the economy as a whole. The main purpose of the RBA is to maintain a stable inflation rate of 2-3% by adjusting interest rates up or down. Compared to other major central banks, relatively high interest rates support AUD and the opposite of the relatively low level. RBA can also use quantitative facilitating and squeezing to affect credit conditions with the old Aud-negative and second Aud-positive.
China is the largest trade partner in Australia, so the health of the Chinese economy is a major impact on the value of the Australian dollar (AUD). When the Chinese economy gives good results, it buys more raw materials, goods and services than Australia, increasing demand for AUD and increasing its value. On the contrary, the Chinese economy does not grow as fast as expected. Therefore, positive or negative surprises in Chinese growth data have a direct effect on the Australian dollar and pairs.
According to data from 2021, Iron Ore is the biggest export of Australia, which calculates $ 118 billion per year as China’s primary target. The price of the iron ore can therefore be the driving force of the Australian dollar. In general, if the price of the iron ore increases, AUD also rises as the total demand for the currency increases. If the price of the iron ore decreases, the opposite is the opposite. Higher iron ore prices tend to cause a positive trade balance for Australia, which is positive of AUD.
The difference between what he earned from imports from the exports of a country for imports is another factor that may affect the value of the Australian dollar. If Australia is produced at a high rate of exports, the currency gains value from the demand created since foreign buyers who want to buy their exports spend to buy imports. Therefore, a positive net trade balance strengthens AUD with the opposite effect if the trade balance is negative.
