AUD/USD has been quite bearish due to downbeat economic reports from Australia and unchanged RBA Cash rate statement report published yesterday. Australia released a negative report of Building Approvals at -5.6% which previously was at 4.8% and was expected to be at -1.2%. Yesterday, Australia's Retail Sales report was better than expected, showing growth to 0.6% which was expected to be at 0.2% but the fresh figure was less than the previous value of 1.0%. Besides, in the RBA statement the Cash Rate was unchanged at 1.50% which was quite disappointing amid the recent global economic boom where most of the central banks are signaling a rate hike in the short term. Though today, Australia's AIG Service Index report was published with a better figure at 54.8 which previously was at 51.5, it didn't provide AUD with support against USD. On the USD side, today we have Factory Orders report which is expected to show more deficit at -0.5% which previously was at -0.2%. As it is one of the leading indicators of rising purchase orders in the industrial sector, this means a robust development in the manufacturing sector or the secondary sector of the economy. If the news comes positive today, we might see USD gaining much more against AUD in the coming days.
Now let us look at the technical chart. Today price has already rejected the bulls off the 0.7630 level retesting it as a resistance after breaking below it yesterday. Currently the price is being hold by the dynamic support of 20 EMA but it is expected to go more down towards 0.7500-50 support area in the coming days. If the price breaks below 0.7500 with a daily close, then a further bearish move is expected. On the other hand, if the price bounces off the support area 0.7500-50 and closes above 0.7550 with a daily close, then we will consider buy positions with a target towards 0.7750 resistance level. The bearish bias is expected to continue further until price breaks above 0.7630 with a daily close.
