FxWirePro: AUD/USD Consolidates Above 61.8% Fib, Weakness to Resume on Close Below
- AUD/USD failed to close below 61.8% Fib of Jan to Apr rally (0.7212) on Thursday.
- The pair is now consolidating above the 61.8% Fib level and weakness to resume only on close below.
- Positive comments on Australia’s inflation outlook by RBA's Edwards in a WSJ interview likely to keep AUD supported.
- Edwards said that there was no urgency to restore inflation to target, adding that inflationary expectations remain anchored.
- Recovery in the oil prices and the Asian equities also helping lift demand for higher-yielding currencies.
- AUD/USD currently trading around 0.7225, finds stiff resistance at 0.7242. Break above could find next hurdle at 0.7259 (5-DMA).
- On the downside 61.8% Fib (0.7212) is immediate support, break below sees next support at 0.7176 (May 19th low).
- We had advised a short in the pair (http://www.econotimes.com/FxWirePro-AUD-USD-breaks-618-Fib-hits-fresh-11-week-lows-on-poor-jobs-data-210104).
- Recommend holding for downside. Bearish invalidation above 0.73