Aussie One of the Most Benefited Major Currencies

The Australian dollar is one of the major currencies most benefited from the expectations on an ongoing economic recovery and higher demand for commodities due to increased government spending. AUD/USD posted a fifth straight month of rally in August and was up by about 20% from March, compared 8% for euro and 2% for Japanese yen over the same period.

Furthermore, data released this morning showed that China's Caixin Manufacturing PMI rose to 53.1 in August (52.5 expected), the highest level since January 2011 and "was indicative of a solid overall improvement in the health of the sector".

Later today, the Reserve Bank of Australia is expected to keep its benchmark rate unchanged at 0.25%, which is likely to have little impact on the currency.

Let's take a how Aussie against U.S. dollar, Euro and Japanese Yen.


AUD/USD: Upside prevails


Source: GAIN Capital, TradingView

The pair is supported by a rising trend trend line, indicating a bullish outlook. The rising 20-day and 50-day moving averages are also as support now.

The relative strength index breaks above the declining trend line and erases the condition of the bearish divergence signal.

Bullish readers could set the nearest support level at 0.7060, while the resistance levels would be located at 0.7510 and 0.7810.


AUD/JPY: Further upside expected


Source: GAIN Capital, TradingView

The pair confirmed a bullish breakout of the ascending triangle, calling for a further upside.

Currently, the prices are trading above both rising 20-day and 50-day moving averages. 

Unless the support level at 75.50 is broken, the pair should reach the resistance levels at 80.30 (138.2% expansion) and 82.50 (161.8% expansion).


EUR/AUD: Under pressure below 1.6550


Source: GAIN Capital, TradingView

The pair is holding on the downside. Currently, the prices are ranging between 1.6550 and 1.6040.

In fact, the prices stay below both 20-day and 50-day moving averages. The relative strength index broke below the rising trend line. Above technical indicators would suggest a bearish outlook for the pair.

The reader could put the resistance level at 1.6550, while the support levels would be located at 1.6040 and 1.5680 respectively.