Good day forex traders.

Welcome to another forex forecast review of the AUD/USD. This currency pair in comparison with the EUR/USD is much less popular although the AUD/USD presents a good opportunity for diversification.

In the previous review we noted that both the SMA 20 and SMA 50 were bearish and this might mean further bearish pressure. An attempt to test the extended bearish target of 1.0140 might be possible but the charts suggested a possible test of the support turned resistance region of 1.0330. The Reserve Bank of Australia RBA ‘s hint of a willingness to cut interest rates to stimulate the economy probably weighted down on the currency.

Technical Analysis

The AUD/USD did continue to test the region of 1.0330 and succeeded in breaking through.

SMA 20 = bearish
SMA 50 = flattening

The SMA 50 is flattening and this suggest that the bearish pressure may be easing. The currency pair tested and fail to break the 1.0430 region and has eased off since.

Fundamental Analysis

It was reported that China’s growth was clocked at 8.1% last quarter which was lower than expected. Sentiments were dampened as speculations of a cooling Chinese economy weights down on Australia’s economy too. This growth is the least in almost 3 years. China is Australia’s key trading partner.

Speculations of an interest rate reduction by the Reserve Bank of Australia RBA continued to surface too as investors felt that it might be done to prop up the Australian economy.

Trade Safely.

Related Forex Articles from the Koala Forex Training College.

How a low interest rate affects a currency

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AUD/USD Forex Forecast Weekly Review 14 Apr 12

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