Aussie took a plunge after Retail Sales m/m and Trade Balance performed worse than forecast. Yesterday’s rise in prices was attributed by the weakness of the Dollar as well as the rise in Aussie’s GDP. Candles now draw near the support at 0.7708 where we might see a continuation of the bullish run of the pair given the weak data coming from the U.S. Attention should be highly paid to price 0.7708 where it is possible to engage in a longing entry with a good risk to reward ratio with the first resistance level at 0.7825.
Observing the H4 chart, stochastic oscillator now hooks below the overbought region, indicating a weakening buying action in the market. Additionally, candles were highly resisted at Fibonacci Retracement 38.2% at 0.7813. Prices are expected to fall for the next few hours but should candles fail to close below 0.7708, we can expect prices to continue extending its gains despite the weak data that was released earlier on as price 0.7708 is a strong support level.
Focusing on the hourly chart, candles took a tumble earlier on and candles are likely to retrace towards the 55 EMA before falling further. However, traders should pay attention to the price region between 0.7708 and 0.7681 as that is a good support region where traders may decide to engage in any positions depending on the setup. Overall, trend direction remains uncertain but focus for the pair still remains on the release of U.S Non-Farm Employment Change data tomorrow with expectations of big movements.