- AUD/USD trades a narrow range in the Asian session today after bouncing off strongly from PBoC led slump on Thursday.
- The pair has recovered from lows of 0.7371 on Thursday, but upside today capped at stiff trendline resistance currently at 0.7455.
- Doji formation seen in the Asian session till now, we see scope for further upside only on breaks above 0.7455 resistance.
- Worse-than-expected Caixin China manufacturing PMI report disappointed markets and weighed on the investors’ sentiment, capping upside in the Aussie.
- Data released earlier showed China Caixin Manufacturing PMI stood at 48.6 vs. 49.2 expected and 49.2 last.
- However, extended risk-on rally in the Asian equities underpins the demand for the higher-yielding currency AUD, which is likely to keep downside limited.
- The pair finds immediate support at 0.7437 (session lows), then 0.7427 (20-DMA) and 0.7411 (5-DMA).
- On the upside resistance is seen at 0.7455 (trendline), 0.7463 (June 7th high) and 0.7472 (June 30th high).
- Later in the NY session, US manufacturing reports from both the Markit and ISM will be in focus for fresh cues on the major.
- Techs are inconclusive. We prefer to wait for clear technical indication to take any call.
The material has been provided by InstaForex Company – www.instaforex.com