AUD/USD: support holds... for now

AUD/USD was supported this week at $0.8930 and managed to stay inside the Ichimoku Cloud (the lower border is at $0.8958). Aussie has shaken off the gruesome labor market data (unemployment rate rose last month to 6%). At its February the Reserve Bank of Australian has turned neutral, but the drop in employment clearly should ease concerns about potential nearer-term rate hikes. The RBA Assistant Governor Christopher Kent said today a weaker currency will help the economy return to trend growth.

Commerzbank notes that AUD/SUD is capable to retest $0.9079/86 (Jan. high, 38.2% Fibo of the decline from Oct. to Jan.) and probably to $0.9230 (200-day MA) where the bank expect the bulls to fail. Credit Suisse also says that AUD/USD could rise to $0.9200/9300 driven by a temporary rise in Australian yields. However, the specialists underline that Australian fundamentals won’t justify such growth. Hence, they recommend selling AUD on rallies.

Goldman Sachs continues to expect the Aussie to fall to $0.8800 in 6 months and to $0.8500 in 12 months. Nomura says that AUD/USD has completed an a-b-c correction and is ready to resume the downtrend.

Resistance lies at $0.9088, $0.9150 and $0.9215. Support is at $0.8930, $0.8907 and $0.8850.

Chart. Daily AUD/USD

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