AUD/USD: the instrument is declining 02 February 2021, 08:42

AUD/USD: the instrument is declining

02 February 2021, 08:42

Scenario
Timeframe	Intraday
Recommendation	BUY STOP
Entry Point	0.7680
Take Profit	0.7757
Stop Loss	0.7630
Key Levels	0.7500, 0.7556, 0.7600, 0.7641, 0.7675, 0.7700, 0.7725

Alternative scenario
Recommendation	SELL STOP
Entry Point	0.7595
Take Profit	0.7500
Stop Loss	0.7655
Key Levels	0.7500, 0.7556, 0.7600, 0.7641, 0.7675, 0.7700, 0.7725

Current trend

AUD shows ambiguous dynamics of trading against USD during today's Asian session, consolidating at 0.7620. Investors are now focusing on the RBA's decision on the interest rate with follow-up comments, which, however, did not affect the alignment of positions on the market.

Much more support for the instrument is provided by the macroeconomic statistics released yesterday in Australia. AiG Performance of the Manufacturing Sector Index in January rose from 52.1 to 55.3 points, ahead of the average forecasts. The Home Loans in December accelerated from +5.5% to +8.7%, and the RBA Commodity Index SDR rose by impressive +19.7% YoY in January after rising by 11.7% YoY in December.

Support and resistance

Bollinger Bands in D1 chart demonstrate a moderate decrease. The price range is slightly narrowing, reflecting the ambiguous dynamics of trading in the short term. MACD is declining keeping a stable sell signal (located below the signal line). The indicator is about to test the zero level for a breakdown. Stochastic is showing similar dynamics; however, the indicator line is already approaching its lows, indicating the risks of oversold instrument in the ultra-short term.

Existing short positions should be kept until technical indicators are clarified.

Resistance levels: 0.7641, 0.7675, 0.7700, 0.7725.

Support levels: 0.7600, 0.7556, 0.7500.

Trading tips

To open long positions, one can rely on the breakout of 0.7675. Take-profit – 0.7757. Stop-loss – 0.7630. Implementation time: 2-3 days.

The return of "bearish" trend with the breakdown of 0.7600 may become a signal for new sales with the target at 0.7500. Stop-loss – 0.7655.