The fall in the commodity prices hits the Australian economy very badly in the recent years. The Australian economy used to be called as luck country, there are many natural resources such as coal, iron ore, and gold. After the commodities super cycle the iron ore and coal prices have been falling sharply. Recently, gold prices added some more pressure to the AUD.
Goldman Sachs expects that iron ore prices will continue falling until the second quarter of 2016.
The pressure from the nuclear deal makes the oil prices move lower. The lower oil prices directly effect the Canadian economy.
Upcoming events: Traders keep an eye on the data on unemployment rate and employment change in Australia. Besides, Canada's trade balance is due to be released today.
Overview: The cross has been trading on a bearish texture. The cross retested 0.9400 thrice in 15 months, but successfully managed to close above that. The 20- and 50Dsma are found at 0.9515, and 20Wsma seems to be at 0.9550.
After the RBA kept the rates unchanged the AUD spiked 1.50% closing at the highest point of the day.
On the daily chart, the cross managed to close above all the moving averages. The cross made a higher low and higher high on the daily chart.
On the weekly chart, the cross managed to close above 20- and 50Wsma.
At yesterday's session, the cross faced resistance at 0.9745 and parallel resistance at 0.9744. The nearest resistance seems to be at 0.9790 100Wema, 0.9810 100Wsma, and 0.9840.
Today the cross is trading at 0.9715 compared to the Tuesday close at 0.9731. The cross has some more room towards the 0.9800 and 0.9820 levels.
Intraday: Support is at 0.9700, 0.9650, and 0.9630. Resistance is at 0.9775, 0.9800, and 0.9820.
Trade: We recommend fresh buying above 0.9750 aiming at 0.9775 and 0.9800, and in the extreme case, at 0.9820 or even further to 0.9840.
Trend: The trend favours buying on the dip at 0.9650 and 0.9630. SL is at 0.9600. For positional basis, buy with SL 0.9530.
The material has been provided by InstaForex Company – www.instaforex.com