AUD/USD plunges as the USD is lifted by the USDX’s rally. The pair decreased and erased the last two day’s gains and is almost to reach a confluence area very soon.
Price moves in range on the short term, but maintains a bearish bias because is still trapped below very strong resistance levels. The rate failed to stabilize above a very strong dynamic resistance and to close near another one, so the current drop is natural and it may continue if the USDX will make new highs. Is very important to see what will happen with the USDX in the upcoming days. I’ve said that the USDX will make a larger increase if will have enough directional energy to close and stabilize above the 93.50 psychological level.
The Aussie increased a little in the morning, but has taken a serious hit from the Australian GDP, which has increased only by 0.6% in the third quarter, less versus the 0.7% estimate and compared to the 0.9% growth in the former reading period. The USD moves higher versus its rivals as the United States ADP Non-Farm Employment Change has come in better than expected, it was reported at 190K in November, higher versus the 189K estimate. Moreover, the Revised Nonfarm Productivity increased only by 3.0%, less versus the 3.3% estimate, which is better for the USD.
The rate failed to stay above the median line (ML) of the major descending pitchfork and now is almost to reach the confluence area formed by the sliding line (SL) with the downtrend line, a valid breakdown will signal a further drop in the upcoming period. We’ll see what will happen in the upcoming hours, but a further drop is favored after the failure to close right on the median line (ml) of the descending pitchfork. Technically, the downside target remains at the lower median line (ml) of the descending pitchfork, will reach it if the dollar index will have enough energy to jump above the 93.81 upside target.