Key Highlights
- The Aussie Dollar made a nice upside move above 0.7900-0.7950 against the US Dollar.
- There is a crucial bullish trend line forming with support at 0.7950 on the 4-hours chart of AUD/USD.
- Australia’s Construction Work Done rose by 9.3% in Q2 2017, more than the forecast of 1%.
- Australia’s Building Permits declined by 1.7% (MoM), less than the forecast of -5%.
AUD/USD Technical Analysis
The Aussie Dollar is in a solid uptrend from the 0.7800 low against the US Dollar. The AUD/USD pair is now comfortably placed above 0.7950 and looking to test 0.8000.
Looking at the 4-hours chart, there is a crucial bullish trend line forming with support at 0.7950. The pair recently tested a resistance trend line at 0.7996 and is currently correcting lower.
On the downside, an initial support sits at the 38.2% Fib retracement level of the last wave from the 0.7905 low to 0.7996 high.
However, the most important support is near 0.7950, which is also the 50% Fib retracement level of the last wave from the 0.7905 low to 0.7996 high. The 0.7950 level was a resistance earlier and now likely to act as a support.
Once the current correction is complete, the AUD/USD pair is likely to resume its upside with a break above 0.8000.
Australia’s Building Permits and Construction Work
Today, Australia’s Building Permits report for July 2017 was released by the Australian Bureau of Statistics. The forecast was slated for a decline of 5% in permits compared with the previous month.
The actual result was better, as the decline was 1.7%. However, it was disappointing compared with the last revised increase of 11.7%. In terms of the yearly change, there was a decrease of 13.9%, less than the forecast of -16.6%, but more than the last -2.3%.
The report added that:
The trend estimate of the value of total building approved rose 1.3% in July and has risen for six months. The value of residential building was flat. The value of non-residential building rose 3.1% and has risen for six months.
The Construction Work Done report for Q2 2017 was also published today. The forecast was slated for a rise of 1% in Q2 2017. The actual was a lot better, as there was a rise of 9.3%, more than the last revised 0.9%.
The overall outcome was positive, and would help AUD/USD to remain above 0.7950 in the near term. Today,s US GDP release for Q2 2017 (Prelim) is forecasted to post an annual rise of 2.7%, which could impact the US Dollar and all major pairs in the near term.
