Current trend

Against the growth of the American currency, the AUD/USD pair is retreating from the highs of the last week, trading around 0.6759.

The July manufacturing PMI of Australia rose from 48.2 points to 49.6 points but the sector PMI fell from 50.3 points to 48.0 points. An extended review of the Q2 consumer price index is expected tomorrow: according to analysts, inflation could reach 1.0% instead of 1.4% earlier, leading to a slowdown in the growth rates from 5.6% to 5.4% YoY, which is not enough to start a strong economic recovery.

The dynamics of the US dollar changed to positive, and quotes returned to the 101.000 area in the USD Index, now trading around 100.900. The manufacturing PMI rose from 46.3 points to 49.0 points, supporting the currency. The positive dynamics may continue today, as experts expect the Conference Board consumer confidence index to strengthen from 109.7 points to 111.8 points.

Support and resistance

On the daily chart, the trading instrument is moving within the global Expanding Formation pattern with dynamic boundaries 0.6940–0.6420, the implementation of which continues in a downtrend.

Technical indicators are weakening the buy signal: fast EMAs on the Alligator indicator are approaching the signal line, narrowing the oscillation range, and the AO histogram is forming down bars in the buying zone.

Resistance levels: 0.6800, 0.6900.

Support levels: 0.6710, 0.6570.

Trading tips

Short positions may be opened after a reversal, reduction, and consolidation of the price below 0.6710 with the target at 0.6570. Stop loss – 0.6800. Implementation period: 7 days or more.

Long positions may be opened after a reversal, growth, and consolidation of the price above 0.6800 with the target at 0.6900. Stop loss – 0.6750.