Aussie Holds 0.72 Support as USD Strength Cap Rally

AUD/USD Slips as Dollar Strength Pressures the Aussie

AUD/USD is down over 0.25% on the day. But this isn’t Aussie specific. It looks more like USD strength. GBP/USD and EUR/USD are also weaker among the majors. Middle East tension and elevated energy prices are keeping the USD relatively firm. But NAB Business confidence could have also contributed to the decline in the Aussie.

AUD/USD Underperforms as the Greenback Firms

Currency Heat Map

Source: FXEmpire.com

AUD/USD Faces Pressure as NAB Business Confidence Stays Weak

The NAB Business Confidence is not so confident. April and May readings are sitting deep below zero. Yes, Australian businesses are more cautious on trading conditions, profitability, hiring and the broader outlook. This data point could be attributed to the pullback in the AUD/USD over the last 24 hours. On another note this may possibly keep the RBA from sounding too hawkish and raising rates.

NAB Business Confidence Remains Deeply Negative

Bar Chart Showing Australia’s NAB Business Confidence

Source: TradingView

AUD/USD 0.001-Brick Renko Cools Near Support

AUD/USD seems to have found some support around the 0.7205 price level but the Z-Score SMA needs to confirm with a change in trend. There’s a positive crossover on the 50-SMA and a trend flip on the Supertrend. RSI is also slightly above 50. Once we get that confirmation we can see AUD/USD making a move back towards 0.72775.

AUD/USD 0.001 Brick Renko Finds Some Support

AUD/USD Renko Chart with 0.001 Brick Size

Source: TradingView

The Verdict

Current Trend Direction: Bullish

Bias: Positive

Support Levels: 0.6833,0.70720

Resistance Levels: 0.72715, 0.74070

Medium Term Path: Despite the minor pullback over the last 24 hours AUD/USD remains in a constructive uptrend. Expectations that the Aussie will hold at around 0.7200 support and make another attempt in the short term for 0.72775. In the medium term the move for AUD/USD is at 0.7407.