AUDUSD analysis 07.05.2020

The Australian dollar fluctuated in a narrow range tilted to the upside during the Asian session, to witness its bounce for the third session in four sessions from the lowest since April 24 against the US dollar, following the developments and economic data that it had reported on the Australian economy and on the cusp of developments and economic data expected today Thursday by The American economy, which includes the talk of Federal Open Market Committee member and Chairman of the Federal Reserve Bank of Patrick Harker.

At 02:32 am GMT, the Australian dollar pair rose against the US dollar by 0.25% to 0.6416 levels, which is the highest level for the pair during the trading session compared to the opening levels at 0.6399, while the pair achieved its lowest at 0.6379.

On the Australian economy, we followed the disclosure of the services index reading by the Australian Industrial Group (AIG), which reflected the widening of the contraction to 27.1 compared to 38.7 in April, and this came before we witnessed the release of the Trade Balance Index reading, which indicated the surplus widening to $ 10.60 billion Aussie compared to A $ 3.87 billion in March, contrary to expectations for a surplus of A $ 6.40 billion.

On the other hand, investors are currently awaiting by the US economy the release of the aid claims index for the last week on the second of May, which may reflect a decline of 839 thousand applications to 3,000 thousand requests compared to 3,839 thousand requests in the previous weekly reading, while reading requests may appear The continuous benefit for the last week on the 25th of this month, increasing by 1,913 thousand applications to 19,905 thousand applications compared to 17,992 thousand requests.

This comes in conjunction with the issuance of the initial reading of the single labor cost index, which reflects the acceleration of growth to 4.3% compared to 0.9% in the fourth quarter, while the initial reading of the productivity of the sectors other than agricultural may indicate a decrease of 5.4% against a rise of 1.2%, leading to the participation of the member of the Federal Open Market Committee And the Chairman of the Federal Reserve Bank of Philadelphia at a hypothetical panel discussion on Coronavirus and economic prospects at the Chicago Board of World Affairs.

Technical analysis

The Australian dollar versus the US dollar achieved a break of 0.6407 and closed the daily candle below it, which stops the suggested positive scenario in our recent reports and puts the price under negative pressure again, on the way to visit the 0.6236 level as a first negative target.

Consequently, the downside direction will be expected for the coming period, supported by the negative pressure formed by the EMA50, noting that breaching 0.6407 and holding above it will stop the suggested decline and push the price to recover again.

The expected trading range for today is between 0.6300 support and 0.6450 resistance.

Expected trend for today: bearish.