AUD/USD Set to Test Resistance Near 0.7500 Amid Improving Australian Fundamentals

AUD/USD – Technical Analysis for Australian Forex Trading

Australia – CB Leading Index

Today, at GMT 3:30 p.m., the Conference Board Inc will release the month-over-month leading index for Australia, which measures the changes in the level of a composite index based seven other major fundamental indicators.

Since the CB leading index aggregates some of the other indicator data, Forex traders consider this to be an important representation of the overall Australian economy. However, since most of these data are previously released, the CB leading index tends to have a minimized immediate market impact.

For the last two months, the CB leading index increased by 0.4% and if the positive trend continues this month, it would like have a bullish influence on the Australian Dollar against other major currencies.

United States – Existing Home Sales

On Wednesday, at GMT 3:00 p.m., the US National Association of Realtors will release the existing home sales number, which is the annualized number of residential buildings that were sold during the last month in the country. However, this figure excludes the number newly building constructions.

Since the sale of an existing home usually has a wide-spread positive ripple effect in the local economy, collectively this figure acts as an excellent leading indicator of the overall economic health of the country. Therefore, Forex investors consider the existing home sales number to be an important data as it tends to have a considerable market impact.

Last month, the US existing home sales figure came out at 5.71 million and the forecast for this month is currently set at 5.65 million.

AUD/USD Forecast

AUD/USD Analysis for Australian forex trading

Since forming a bearish outside bar on March 21, 2017, the AUD/USD remained in a strong downtrend that pushed price down by around 340 pips over the last two months. However, as soon as the AUD/USD price reached near the 0.7335 level, it found a strong support and started a bullish retracement move.

Earlier today, the AUD/USD penetrated above the downtrend line and currently, it is approaching the next resistance level near the 0.7500 level.

As the Australian CB leading index is expected to grow by around 0.4%, but the US existing home sales figure is expected to come lower compared to last reporting period, we believe it would likely set a bullish fundamental outlook for the AUD/USD this week. Therefore, if the AUD/USD breaks above the next resistance level around 0.7500, it would likely attract additional bullish momentum in the market.

Hence, Australian Forex traders should look out for trading opportunities above this major resistance level around the 0.7500 level.

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Asif worked as a prop trader for almost a decade, and later he managed trading operations for one of the largest foreign exchange strategy developers in Europe. Currently, he works as a trading consultant to several brokers and writes about various tech and financial topics. You can reach him at contact@asifimtiaz.com

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Asif Imtiaz

Asif worked as a prop trader for almost a decade, and later he managed trading operations for one of the largest foreign exchange strategy developers in Europe. Currently, he works as a trading consultant to several brokers and writes about various tech and financial topics. You can reach him at contact@asifimtiaz.com

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