(MENAFN- Daily Forex) Bullish view
Buy the AUD/USD pair and set a take-profit at 0.6620. Add a stop-loss at 0.6485. Timeline: 1-2 days.
Bearish view
Set a sell-stop at 0.6500 and a take-profit at 0.6400. Add a stop-loss at 0.6600.
The AUD/USD exchange rate remained in a consolidation phase as China's Two Sessions meeting started in Beijing and after Australia published mixed economic numbers. This performance was in line with the performance of other forex majors , which remained in a tight range. It was trading at 0.6515, a few points below last week's high of 6535's Two Sessions meetings
An important meeting known as Two Sessions started in China with little fanfare. Xi Jinping, the country's president, has decided to avoid further stimulus as the economic growth stalls. The government now targets an economic growth of 5% this year.
Activities in China have an impact on Australia since it is the biggest buyer of its products like coal, nickel, and iron ore. In most periods, Australia tends to do well when China is thriving. This partly explains why the Aussie has dropped by over 5% from its highest level in 2023.
The AUD/USD pair also reacted mildly to the important Australian economic numbers. According to the country's statistics bureau, building approvals jumped by 10% in January after falling by 1.70% in the previous month. These approvals dropped by 1.0% on a MoM basis.
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Meanwhile, private house approvals fell by 9.9% while business inventories fell by 1.7% in the last quarter. These numbers mean that the country's economy is slowing.
This view will be confirmed when the government publishes its estimates of the fourth quarter GDP. Economists expect the data to show that the economy expanded by 1.5% in Q4 after growing by 2.1% in the previous quarter.
The AUD/USD will react to the latest US services PMI numbers, which will come in the afternoon session. Economists expect the report by S&P Global to show that the PMI dropped to 51.3 in February from the previous 52.5.
A separate report by ISM is expected to show that the non-manufacturing PMI slipped slightly from 53.4 in January to 52.9. The US will also publish the latest factory orders and durable goods orders numbers/USD technical analysis
The AUD/USD pair remained in a tight range on Tuesday morning. On the four-hour chart , the pair moved slightly below the Woodie pivot point. It has dropped below the 25-period and 50-period Exponential Moving Averages (EMA) .
The pair has also formed a symmetrical triangle pattern, which has a few days or weeks to get to its confluence point. Further, the Klinger oscillator has pointed upwards.
Therefore, the pair will likely remain in this range on Tuesday as traders wait for the upcoming Australia GDP and US jobs data. The key support and resistance levels to watch will be at 0.6482 and 0.6565, respectively.
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