AUDUSD has been moving in the downward channel for over two years. During this time the value of the Australian dollar to the US dollar has fallen from 0.8130 to 0.6440, which is close to -25%.
Australia is the world’s largest exporter of iron ore, with China as its main customer. Negotiations lasting nearly a year and difficulties in signing a new trade agreement between the US and China had a significant impact on the risk of falling demand for this raw material, which in the long run weakened the Australian currency. The weakening currency has undoubtedly also been affected by several weeks of bush fires and drought, but it seems, at least from a technical point of view, that it is time for an upward adjustment, at least a few percent.
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On the daily chart we can see the Inside Bar candlestick pattern. It was formed by the last candle of February with the first candle of March. Today, the price has broken out of the pattern, this is accompanied by an ascending MACD , and there is a high probability of continued increases towards the resistance of the channel, which is currently around 0.6750. An additional support for the AUD may be yesterday’s unexpected cut by 0.50pb interest rates in the USA.
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