The Australian Dollar (AUD) extended downside movement against the US Dollar (USD) on Wednesday, dragging the price of AUDUSD to less than 0.7600 following the release of some key economic news. The technical bias remains bullish because of a Higher High in the recent upside rally.
Technical Analysis
As of this writing, the pair is being traded near 0.7595. A hurdle may be noted around 0.7654, the confluence of a horizontal resistance as well as the intraday high of yesterday. A break above the 0.7654 resistance shall validate a rally towards the 0.7753, the swing high of the latest major upside rally as demonstrated in the given below daily chart.
On the downside, the pair is likely to find a support around 0.7500-0.7510, the confluence of the horizontal support and the psychological number ahead of 0.7420, the swing low of the latest major downside move. The technical bias will remain bullish as long as the 0.7420 support area is intact.
Construction Work Falls
Total construction work done in Australia has fallen for the fifth consecutive quarter, dragged down by new work failing to fill the void left by the completion of big resource projects. On a seasonally adjusted basis, the Australian Bureau of Statistics figures show that the value of total construction fell 3.7 per cent in the June quarter to $47.4 billion, a level not seen since June 2011, when the construction sector was just beginning to recover from the GFC. Total construction over the year is now down 10.6 per cent.
Trade Idea
Considering the overall technical and fundamental outlook, selling the pair on short-term rallies appears to be a good strategy in the near term.
Trade global forex with the best ECN broker of 2021*. Choose from 50+ forex markets 24/5. Open your FXOpen account now or learn more about making your money go further with FXOpen.
* FXOpen International, best ECN broker of 2021, according to the IAFT
