Bullish View
- Set a buy-stop at 0.7495 and a take-profit at 0.7550.
- Add a stop-loss at 0.7400.
- Timeline: 1-2 days.
Bearish View
- Set a sell-stop at 0.7450 and a take-profit at 0.7400.
- Add a stop-loss at 0.7500.
The AUD/USD price retreated slightly as traders looked at the happenings in Australia where New South Wales (NSW) reported more COVID cases. The pair will also react to important economic data from the US, Australia, and China later this week.
Australia COVID Cases
The AUD/USD has struggled lately as the Australian government battled a new wave of coronavirus. Local governments in NSW even returned some travel restrictions that were supposed to end this week. This seems to be highly unlikely as the number of cases increases.
According to the government, NSW reported 112 cases in the past 24 hours. At the same time, Victoria and Queensland have reported no cases. Subsequently, Victoria has banned residents from NSW from entering the state. Victoria residents returning home will also need a permit and go to a 14-day quarantine. In all, these measures will affect the Australian economic recovery.
Later this week, the AUD/USD will react to the latest Australian jobs data that will come out on Thursday. Economists expect the data to show that the Australian unemployment rate declined from 5.1% in May to 5.0% in June. They also expect that the participation rate rose from 66.2% to 66.3% as the country added more than 30,000 jobs.
On the same day, the pair will react to the latest China GDP data. Estimates are that the economy expanded by 8.1% while industrial production slowed to 7.9% in June. Macro data from China are important because of the vast amount of resources that China buys from Australia.
The AUD/USD will also react to the data dump from the US. On Tuesday, the statistics bureau will publish the latest consumer inflation data. Economists expect that the headline CPI rose by 4.9% in June while core CPI rose by 4.0% on a year-on-year basis. The US will also publish retail sales numbers on Friday.
AUD/USD Technical Analysis
The AUD/USD pair declined slightly during the Asian session. On the four-hour chart, the pair has formed a bullish Gartley pattern and is slightly above the 25-period and 15-period exponential moving averages (EMA). It is also below the important resistance shown in orange while the MACD pattern is rising. Therefore, the pair will likely resume the upward trend as bulls target the important resistance at 0.7550. On the flip side, a drop below 0.7450 will invalidate this prediction.
