AUD/USD Daily Forecast – Another Test Of Resistance At 0.7575

AUD/USD Video 16.12.20.

Australian Dollar Gains Ground Against U.S. Dollar

AUD/USD is currently trying to settle above the resistance at 0.7575 while the U.S. dollar remains under pressure against a broad basket of currencies.

The U.S. Dollar Index has recently managed to get below the major support level at the yearly lows at 90.50 and is moving lower. In case the U.S. Dollar Index gains additional downside momentum, it will head towards the 90 level which will be bullish for AUD/USD.

The main event of the day for foreign exchange market traders is the Fed Interest Rate Decision and the subsequent commentary from the world’s most important central bank. If the Fed is dovish enough, the U.S. dollar will find itself under additional pressure.

Today, Australia reported that Manufacturing PMI increased from 55.8 in November to 56.0 in December while Services PMI increased from 55.1 to 57.4. Numbers above 50 show expansion. The rebound of the Australian economy remains robust thanks to the country’s success in containing the virus.

In the U.S., Manufacturing PMI is expected to decrease from 56.7 to 55.7 while Services PMI is projected to drop from 58.4 to 55.9. Meanwhile, Retail Sales are projected to decline by 0.3% month-over-month in November as consumer activity slowed down due to the second wave of the virus.

Technical Analysis

AUD/USD managed to get above the resistance level at 0.7535 and is trying to settle above the resistance at the recent highs at 0.7575.

If AUD/USD manages to settle above this level, it will gain additional upside momentum and head towards the next resistance level at 0.7600.

A successful test of the resistance at 0.7600 will open the way to the test of the resistance at 0.7635.

On the support side, the nearest support level for AUD/USD is located at 0.7535. In case AUD/USD declines below this level, it will head towards the next support at 0.7500. Yesterday, AUD/USD tried to get to the test of this level but failed to gain sufficient downside momentum.

If AUD/USD manages to settle below the support at 0.7500, it will continue its downside move and head towards the next support at 0.7485.

For a look at all of today’s economic events, check out our economic calendar.