Current trend

Amid the neutral dynamics of the American dollar and poor October macroeconomic statistics from Australia, the AUD/USD pair is correcting in a sideways trend at 0.6619.

Thus, according to the Markit report, the manufacturing PMI fell from 46.7 points to 46.6 points, the low since June 2020, declining for the fourth month in a row, and the service PMI strengthened from 50.5 points to 50.6 points, remaining around February lows. The indicators are slightly higher than the levels recorded during the COVID–19 epidemic, which does not allow the national economy to move to a stable recovery.

The American dollar is holding at 103.80 in the USDX, having fallen amid poor September data from the real estate sector, the most lagging sector of the national economy. Building permits fell from 4.6% to –3.1% or 1.470M to 1.425M, but new home sales increased from 709.0K to 738.0K, the year’s high. In addition, initial jobless claims changed from 242.0K to 227.0K, reflecting the possibility of the labor market stabilization.

Support and resistance

On the daily chart, the trading instrument is correcting near the support line of the channel with dynamic boundaries of 0.7000–0.6600.

Technical indicators are strengthening the sell signal: fast EMAs on the Alligator indicator have reversed and are moving away from the signal line, expanding the range of fluctuations, and the AO histogram is falling in the sell zone.

Resistance levels: 0.6652, 0.6790.

Support levels: 0.6595, 0.6480.

Trading tips

Short positions may be opened after the price declines and consolidates below 0.6595, with the target at 0.6480. Stop loss — 0.6640. Implementation period: 7 days or more.

Long positions may be opened after the price grows and consolidates above 0.6652, with the target at 0.6790. Stop loss — 0.6600.