Home Forex Market Analysis Forex Signals AUD/USD Plunges to Complete Retracement – Quick Trade Plan! 

AUD/USD Plunges to Complete Retracement – Quick Trade Plan! 

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The AUD/USD pair was closed at 0.77604 after placing a high of 0.7773 and a low of 0.76607. Despite the positive macroeconomic data from the US and the rising demand for safe-haven, the currency pair AUD/USD rose higher onboard amid the US dollar’s weakness. The greenback weakened after the beginning of the American session, and the US Dollar Index fell to its two-year lowest level at 89.44 on Tuesday ahead of the Georgia runoff election’s result. The Senate election will decide who will control the upper chamber of the US Congress. The incoming Democratic President, Joe Biden, will need the two seats to control the US Senate. The Republican Party has been controlling the US Senate since 2014, and if the Democratic Party wins this election, it would be beneficial for them.

On the data front, at 05:30 GMT, the ANZ Job Advertisements for December dropped to 9.2% against November’s 13.5% and weighed on the Australian Dollar that ultimately capped further gains in AUD/USD pair on Tuesday. From the US side, at 20:00 GMT, the ISM Manufacturing PMI from December rose to 60.7 against the anticipated 56.6 and supported the US dollar, and capped further gains in AUD/USD pair. The ISM Manufacturing Prices also surged to 77.6 against the predicted 66.0 and supported the US dollar that limited further AUD/USD pair gains. The Wards Total Vehicle Sales raised to 16.3M against the estimated 15.8M and supported the US dollar, ultimately limiting further gains in AUD/USD pair.

Meanwhile, the market’s risk appetite was declined as the number of coronavirus cases was increasing day by day throughout the globe. Since the pandemic started has reached 21M, the US count of total coronavirus cases is equal to the count of the next three countries, India, Russia, and Brazil. The UK also reported more than 60,000 cases in a single day on Tuesday that was the highest since the pandemic started, and imposed new tougher restrictions throughout the country. Moreover, Germany also extended its lockdown till the end of the month to control the rising number of coronavirus cases. All these developments added in the safe-haven appeal and weighed on the risk-sensitive Australian Dollar that failed to reverse the AUD/USD pair’s bullish movement on Tuesday.


Daily Technical Levels

Support Resistance

0.7688 0.7806

0.7615 0.7851

0.7570 0.7924

Pivot Point: 0.7733

The AUD/USD faced resistance at 0.7811 level and has dropped now to trade at 0.7776 level. On the lower side, the pair may find support at the 0.7738 level today. The MACD and RSI support bullish bias, while the 50 periods EMA is likely to extend support at the 0.7685 level. On the higher side, bullish breakout of 0.7811 level can trigger buying trade until 0.7864 level today. I will be looking to take a buy trade over the 0.7738 level today. Good luck! 

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