We are bullish and look for support near the 0.7475 range lows to underpin a move higher. Our initial targets are at the 0.7725 recent highs. Beyond there we look for a move towards our greater targets in the 0.7880 area (Barclays, eFXnews).
Meanwhile, better AUD data, rising iron ore prices and a hawkish RBA have support AUD in the last few weeks. However, recent data (retail sales, trade balance, building approvals) all point to a weak 1Q and the RBA included negative language on the AUD in its last statement for the first time since July 2015. We believe data will continue to be weak and like selling AUD on rallies as a higher AUD puts growth at risk and makes an RBA cut more likely (Rubenfeld & Khoo, Morgan Stanley Global FX Strategy). The pair needs to break below 0.7470, the low for these last three weeks, to confirm a new leg south towards the 0.7380 region, the 38.2% retracement of the same rally (Valeria Bednarik, FXStreet). In larger time frame, bearish harami occurs on weekly time frame, its could be a sign for bearish along this week (Ismail, TradingView).
AUDUSD Weekly Chart
