After topping at 1.0220, AUD/USD started falling like a rock until it has retested parity a couple of days ago. The pair found a support area at parity and has receded slightly to the upside. In the coming week, traders will be keen to see if the pair will be able to gather enough bearish pressure to convincingly break parity.
Because of the growing growth concerns in China, economic problems of the euro zone, and weak economic data from the United States, risk aversion has been governing the Forex market. Among the major currencies, the Aussie was hit the most and it realized the biggest loss. In addition, the Aussie has been sold off heavily because of the generally softer commodity prices, which have a huge impact in its performance.
Technical analysis on the AUD/USD reveals it has retested parity. Immediate resistance is found at 1.0134. A confirmed break above this could expose the recent high at 1.0220. Immediate support is found at parity. A confirmed break below this could expose 0.9929.
At the moment, the best case scenario would be to wait and see if the pair makes significant movements either below or above parity before pulling the trigger. Otherwise, you may be caught on the wrong side of the trade if you try to place a trade now.
DISCLOSURE & DISCLAIMER: THE ABOVE IS FOR INFORMATIONAL PURPOSES ONLY AND NOT TO BE CONSTRUED AS SPECIFIC TRADING ADVICE. RESPONSIBILITY FOR TRADE DECISIONS IS SOLELY WITH THE READER.