Hot Features
Premium
Trade smarter, not harder: Unleash your inner pro with our toolkit and live discussions.
The aussie has hit a new low for the year today as the risk-off environment pervades the market once more. With commodities struggling, led by a near 20% decline in iron ore prices this month, there has also been little support from Treasury bond yields either, which have fallen to multi-week lows.
Tariff tensions are front and centre for markets currently and President Trump’s opening salvo of $60bn worth of tariffs on China has hit the AUD hard. The Australian economy of course has high exposure to the China trade story with its open economy and high dependency on trade. It’s no wonder then that the aussie is the worst performing major currency this month and second on the year now after the depressed CAD.
Weak recent domestic data including disappointing GDP and retail sales figures won’t help the RBA paint a hawkish picture in their meeting next week. The housing bubble also gives a slightly negative backdrop to the aussie, though current domestic data has obviously taken a back seat to the broader trade tumult.
AUD/USD Daily Candle Chart
Technically, AUD/USD met resistance again above 0.81 at the end of January. Since then prices have fallen sharply with a series of lower swing highs and lower swing lows. Choppy trading over the last few days has seen some consolidation of this move but seller’s have taken us through the month-to-date lows of 0.7672 today with the bias firmly tilted to the downside.
That said, this break needs to be confirmed as the chances of a ‘false’ breakout are high if 0.7650 support holds in the near-term. Much will depend on the broader risk mood as we head into the long Easter weekend.
Faraday Research offers real time FX and Equity trade signals from qualified analysts. Click here to try us free.
