The AUD/USD currency pair looks set to end the 6-week losing run experienced since the start of the year following this week’s rebound. The currency pair closed higher on Friday in a consolidative bullish triangle as it looked to break loose off the descending channel.
The pair has now climbed off oversold levels of the RSI indicator after steadying above the 0.6700 key level. This could be the beginning of a significant bull-run.
AUD/USD Fundamentals Overview
From a fundamental perspective, the AUD/USD currency pair is trading at the back of a relatively busy period in the US market. The Aussie is struggling to attract optimism from traders. This comes amid coronavirus fears. Nonetheless, investors will look into the latest economic data from Australia to try to gauge the immediate future of the pair.
On Monday, Australian Home Loans grew by 3.5% in December. Analysts were expecting a growth of just 0.7%. However, National Australia Bank’s Business Confidence Index in January missed with -1 versus an expectation of 0.
On the other hand, Investment Lending for Homes grew by 2.8% in December up from 2.5% in the previous reading. Westpac Consumer Confidence for February also edged higher to 2.3% up from 1.8% in the previous reading. This was also better than the expectation of 1.4%.
In the US, initial and continuing jobless claims outperformed expectations on Thursday. The consumer price index for January was also impressive only missing expectations on the (MoM) estimate.
AUD/USD Technical Analysis (the 60-min Chart)
Technically, the AUD/USD currency pair appears to have recently made an attempt to reverse the current bearish run. The pair is now trading in a slightly bullish triangle after bottoming out at 0.6664 at the start of the week.
Therefore, the bulls will be targeting short-term profits at around 0.6736 or higher at 0.6760. On the other hand, the bears will look to retake control of the pair by targeting profits at around 0.6688 or lower at 0.6664.
AUD/USD Technical Analysis (the Daily Chart)
In the daily chart, the AUD/USD currency pair appears to be trading within a highly volatile sideways channel. The pair recently bounced off the support after 6 weeks of consistent declines to surge above 0.6700. It has now recovered from oversold levels of the RSI indicator amid increased bullish sentiment.
Therefore, the bulls will be targeting long-term profits at around 0.6806 or higher at 0.6893. On the ether hand, the bears will look for a quick pullback towards 0.6623 or lower at 0.6553 going into next week.