AUDUSD since August 2011 moves south. As a result of these declines, in September 2015 market reached level 0.6950 and since then has moved in a consolidation. It is also worth noting that the market has beaten, and then re-testing has already rejected the trend line up.
Looking at weekly chart, we notice that market has moved calmly up since January 2016 and formed an ascending triangle. It is noteworthy that, despite numerous tests, the upper limit of this formation at 0.7760 level for over two years remained unbroken but last week bullish efforts succeeded and the price broke out from the mentioned triangle.
Yesterday at 1:30 GMT minutes of the July RBA meeting on monetary policy were published. As we reported earlier, although comments were not so hawkish, the position on the neutral interest rate in the bank’s assessment led to an appreciation of the AUD. In minutes we read that according to the RBA ratings the neutral value of the main rate fell by about 1% and now stands at 3.5%.
The appreciation of the AUD and the depreciation of the US dollar caused by the declaration of two Republican senators who indicated they did not intend to support Senate health reform project that would replace the well-known Obamacare program caused yesterday’s pushed AUDUSD further north.
If this trend continues, in near future we would expect to test vicinity of 0.8050. It is also worth noting that market has still not tested from above (as support) the upper limit of the previous formation. If the uptrend continues and any correction will occur after rejection of 0.8050 then this support would coincide with the 38.2% of the Fibo correction from the last upward movement.
Whether the growth will continue depends on the direction of the break from yesterday’s consolidation. If breakout thru bottom occurs, then first demand response would be expected in vicinity of previous high coinciding with 70.7% of Fibonacci adjustment from the last growth impulse.
