AUDUSD: Bears are in Control

Negative tone prevails for the AUDUSD pair during the forex trading session. Aussie fundamental data continue to disappoint investors. The Australia’s construction activity has seen its sharpest fall over six years in May. The total value of home loans fell in April by 1% with the result weighed by a 2.2% decline in the value of investor loans. Owner- occupied loan values lifted more than expected, up 1%. Aussie quarterly GDP growth picked up a little in first quarter to 0.4% q/q, although annual growth continued to slow and is now down to 1.8%, the slowest pace since 2009 in the midst of the global financial crisis. A weak household sector, pressure from persistently low income growth, high debt and falling house prices are the main factors of the slowdown.

The Aussie failed to capitalize the USD weakness yesterday. As of writing, the pair trades at 0.6971 close to daily low. The pair breached the 100 hour moving average support zone and shorts took the upper hand for today. On the downside immediate support stands at 0.6960 the low from June 5th, while more bids will emerge at 0.6860 YTD low. On the upside immediate resistance now stands at the previous support at 0.6976 while key resistance stands at 0.7019 where the 50 day moving average crosses.