AUD/USD Likely Turn Bullish as US Building Permits Set to Decline

AUD/USD – Technical Analysis for Forex Trading & CFDs.

Australia – New Motor Vehicle Sales

On Tuesday, at GMT 12:30 a.m., the Australian Bureau of Statistics released the new motor vehicle sales figure, which measures the changes in the number of cars that are sold in the local market over the past month.

Since people tend to make car purchases when they feel confident about their financial conditions, Forex traders consider the new motor vehicle sales figure to be a leading indicator of the consumer confidence in Australia.

Last month, the new motor vehicle sales (m/m) figure remained unchanged by 0.0% and in August it declined by -2.0%. If the trend continues, it would have a negative impact on the Australian Dollar against other major currencies.

United States – Building Permits

On Wednesday, at GMT 12:30 p.m., the US Census Bureau will release the Building Permits figure, which is an annualized number of new building permits for the residential housing sector issued during the last month.

Since getting a building permit usually indicate future construction work, Forex investors consider this data to be a leading indicator of the overall economic activity in the country.

Last month, 1.27 million building permits were issued and this month, analysts are expecting the figure to come out around 1.25 million.

AUD/USD Forecast

The AUD/USD turned bearish after breaking below the uptrend line on September 18 and the pair fell to the 0.7740 in early October. Here, the AUD/USD found a strong support and as a result, it started a bullish retracement last week, which has so far pushed the price to the resistance near 0.7900.

As the Australian new motor vehicle sales have stabilized and remained unchanged last month, but the US building permits figure is expected to go down once again this month to 1.25 million, we believe it would set a bullish fundamental outlook for the AUD/USD this week. Therefore, if the AUD/USD closes above the resistance near 0.7900, 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 0.7900.

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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