AUD/USD Daily Forecast – Australian Dollar Rebounds After Yesterday’s Sell-Off

AUD/USD Video 29.10.20.

Australian Dollar Gains Ground Against U.S. Dollar

AUD/USD managed to stay above the support level at 0.7030 and tested the nearest resistance at 0.7075 while the U.S. dollar remained little changed against a broad basket of currencies after yesterday’s major upside move.

The U.S. Dollar Index has lost momentum but remains close to the nearest resistance level at the 50 EMA at 93.55. If the U.S. Dollar Index manages to settle above this level, it will gain additional upside momentum and head towards the 94 level which will be bearish for AUD/USD.

Today, AUD/USD traders will focus on economic data from the U.S. Third-quarter GDP is expected to increase by as much as 31% quarter-over-quarter as the economy rebounded after the acute phase of the coronavirus crisis.

Initial Jobless Claims are expected to decline from 787,000 to 775,000. Analysts expect to see better progress in Continuing Jobless Claims which are projected to drop from 8.37 million to 7.7 million.

Meanwhile, Pending Home Sales are projected to grow by 3.4% month-over-month in September after growing by as much as 8.8% in August.

Technical Analysis

AUD/USD did not manage to settle below the support at 0.7030 and rebounded closer to the resistance at 0.7075. AUD/USD has already made an attempt to settle above this resistance level but this attempt yielded no results.

In case AUD/USD manages to get above 0.7075, it will head towards the next resistance level at 0.7100. A move above 0.7100 will push AUD/USD towards the 20 EMA at 0.7115.

If AUD/USD settles above the 20 EMA, it will head towards the 50 EMA at 0.7145. The major resistance level at 0.7150 is in the nearby so AUD/USD is set to face strong resistance somewhere in the 0.7140 – 0.7160 area.

On the support side, AUD/USD needs to settle below the support at 0.7030 to continue its downside move. RSI is in the moderate territory so there is plenty of room to gain momentum in case the right catalysts emerge.

If AUD/USD declines below 0.7030, it will head towards the next support level near 0.7000. A move below this level will open the way to the test of the support at 0.6975.

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