The Aussie is getting back to normal, making kangaroo leaps on good data and facing some challenging resistance lines. Here’s an update on the high-yielding Aussie, and a look forward towards the next technical hurdles for AUD/USD.
The Australian dollar is doing well this week. It confirmed the break above 0.8950 and continued higher. The Aussie enjoyed a strong rise in Building Approvals. After last month’s disappointment – a unexpected drop of 1.8%, they rose by 5.9%.
Not only did this rise erase all of last month’s drop and more, the scale of the rise was double the early expectations. A rise of 3.1% was expected in this key Australian figure, and the result helped the Aussie.
This wasn’t the only reason for the Aussie’s rise. After being beaten in December by the mighty dollar, this carry-trade currency is making a comeback also on the dollar’s weakness this week. The dollar is sold almost everywhere, as traders are cautious towards the Non-Farm Payrolls on Friday.
AUD/USD enjoys this dollar-weakness very much. Currently at 0.9200, the pair is very close to the 0.9210 resistance line. If this line is broken, the road to 0.9322 is paved. 0.9322 was a resistance line several times in the fall of 2009. This is already a huge resistance line. More technical lines are mentioned in the AUD/USD forecast.
Apart from the aforementioned NFP, two major releases are still awaited in Australia: Retail Sales are expected to rise by 0.4%, higher than last month, and the Trade Balance is expected to show a smaller deficit than last month. If these expectations are met, the Aussie could break the immediate resistance line of 0.9210.
The bullish sentiment receives some back wind…
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