AUD/USD Struggles for Direction in a Consolidative Sideways Channel

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The AUD/USD currency pair has continued to trade in a consolidative sideways channel around the 0.6775 level for the second successive week. The currency pair appears to be rangebound 0.6804 and 0.6740 within a strong support and resistance zones.

The up and down movement is restricted to just a few pips, which creates multiple trading opportunities for both the bulls and the bears. The AUD/USD is currently tightly pegged to the 100-hour and the 200-hour moving average lines, which evens the ground for the bulls and the bears.

AUD/USD Fundamentals Overview

From a fundamental perspective, the AUD/USD currency pair is trading at the back of a calmer week compared to the previous two weeks, which explains the lack of momentum and direction.

However, this week, the US 3-month and 6-month auction rates fell further for the week ended Aug 16, 2019, with the 3-month bill averaging 1.90% down from 1.96% in the previous week. ON the other hand, the 6-mon bill dropped to 1.84% down from 1.89%.

There was, however, a significant improvement in the Redbook Index, which posted (MoM) decline of 1.7% versus a decline of 2.0% in the previous period while the (YoY) growth was up 4.9% versus 4.4%.

In addition, the US Federal Reserve clarified the decision to cut interest rates at the start of the month. Existing Home Sales beats expectations but this did not give the greenback any support to sway the balance.

AUD/USD Technical Analysis (the 60-min Chart)

Technically, the AUD/USD currency pair appears to be lacking a distinctive direction with the Aussie and the greenback holding it nearly from a sentimental perspective. The market appears to be relatively undecided and this could continue through next week.

Therefore, the bulls will be targeting short-term profits at around 0.6804 and 0.6820 going into next week. On the other hand, the bears will look to pounce by targeting profits at around 0.6740 and 0.6720.

AUD/USD Technical Analysis (the Daily Chart)

In the daily chart, the AUD/USD currency pair appears to be still experiencing intense bearish pressure with the pair consolidating next to the trendline support in recent trading sessions. 

This opens up long-term trading opportunities at around 0.6670 for the bears while the bulls will target 0.6870. The Relative Strength Index indicator has recently bounced off the oversold levels, which suggests that the bulls have a lot of room to aim at.

In summary, the AUD/USD currency pair appears to be trading in a consolidative sideways channel in the short-term, but in the long-term, the bears still appear to be in control.

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