AUDUSD Australian dollar

AUD/USD – Bearish Setup Ahead of the NFP

The AUD/USD pair moved in a relatively tight range so far in the trading year. It found strong support around the 0.76 level while the 0.80 proved to be tough resistance.

For the month of April, it trended higher, bouncing from what appears to be the neckline of a head and shoulders pattern. By failing to make a new high, the pressure mounts for a break below the 0.76 in May.

This week the most important piece of economic data comes out on Friday. The NFP in the United States follows one week after the GDP showed a strong economic recovery during the first quarter of the year.

Yet, despite the strong economic growth, the market kept selling the dollar, as the Fed still keeps the easy monetary policy. If the NFP confirms the strength in the U.S. economy, it may be that the currency market will start reflecting the strong fundamentals. If that is the case, the dollar may bounce strongly, and the AUD/USD pair should keep pressuring the neckline.

AUD/USD Technical Analysis

Bears may want to stay on the short side and add to the position on a break below the horizontal line. 0.7600 is key moving forward, and a move above 0.7900 should invalidate the bearish scenario.

Don’t miss a beat! Follow us on Telegram and Twitter.

AUD/USD Price Forecast

Follow Mircea on Twitter.

Related Posts:

Compare accounts

Provider
Name ATFX Binance
Description

Awarded and global FX/CFD broker. Well-regulated in multiple jurisdictions. Offers great spreads and liquidity for FX, Indices, and Commodities trading.

Cryptocurrency exchange with over 150 coins. As of Jan 18, Binance was the world's largest cryptocurrency exchange per volume.