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AUD Analysis and Talking Points

  • AUDUSD | Challenges Ahead Could Curb Upside
  • AUDJPY | Recovery May be Short-lived as Downside Risks Remain
  • AUDNZD | Resistance Break Key for 1.07 Test

See our Q1 FX forecast to learn what will drive the currency throughout the rest of the year.

AUDUSD | Challenges Ahead Could Curb Upside

Despite the bounce back in AUDUSD, challenges are ahead for the pair. AUDUSD has recovered from last week’s flash crash lows to hit highs of 0.7150, however, the 50 (0.7185) and 100DMA (0.7180) could curb further upside for now, before the pivotal 0.7200 handle. On the downside, there is little in the way of notable support until the psychological 0.7000 handle. Despite the lift in prices, momentum indicators remain bearish.

AUDUSD PRICE CHART: Daily Time Frame (Jul 2018 – Jan 2019)

AUD Technical Analysis Overview: AUDUSD, AUDJPY, AUDNZD

Chart by IG

AUDJPY | Recovery May be Short-lived as Downside Risks Remain

Momentum indicators continue to imply that risks are skewed to the downside for AUDJPY with the series of lower highs confirming this, which in turn suggests the recovery may be short-lived. Alongside this, price action could be curtailed by the descending trendline stemming from the Dec 2018 peak, which currently sits at 0.7780-90. For a continued recovery in the cross a breach of 0.7870 would be needed.

AUDJPY PRICE CHART: Daily Time Frame (Aug 2018– Jan 2019)

AUD Technical Analysis Overview: AUDUSD, AUDJPY, AUDNZD

Chart by IG

AUDNZD | Resistance Break Key for 1.07 Test

AUDNZD is currently hovering around crucial resistance, which marks the trendline from record low, whereby a break and close above could see the cross make a retest of the 1.07 handle. Bearish momentum indicators have also moderated in recent sessions. Outlook is cautiously bullish in the short term.

AUDNZD PRICE CHART: Daily Time Frame (May 2018 – Jan 2019)

AUD Technical Analysis Overview: AUDUSD, AUDJPY, AUDNZD

Chart by IG

G10 FX Technical Reports

--- Written by Justin McQueen, Market Analyst

To contact Justin, email him at Justin.mcqueen@ig.com

Follow Justin on Twitter @JMcQueenFX