AUD/USD above 0.7640 immunes to NFP data

• AUD/USD is trading in a tight trading ranging unaffected by the NFP.
• AUD/USD is in a bear trend but lacking convincing momentum. 

The AUD/USD is currently trading at around 0.7682 virtually unchanged on Friday as the Aussie remain stuck in a range as the week is coming to end. 

The worst-than expected Non-Farm Payroll report in the United States didn’t affect the pair as market participants are primarily focused on the tensions between the US and China. 

“A trade war between the US and China has the potential to put Australia in a difficult position. China is Australia’s biggest trade partner, but the US is its largest source of investment. Given the existence of a current account deficit registering 2.2% of GDP, the AUD could prove to be sensitive to any change in investment intentions. The AUD would also be vulnerable on any slowdown in the pace of growth in China which would have a direct impact on Australia’s economic output via its export markets.” according to Jane Foley, Senior FX Strategist at Rabobank.

AUD/USD weekly chart

The AUD/USD has been trading inside last week’s range still gravitating near the 0.77 handle. The market is currently supported by the 100-period simple moving average. However, the Aussie is trading below its 50 and 200-period simple moving average. The market is creating a wedge bull flag since the start of the year. The weekly RSI is trading below 50 while the MACD displays continuous bearish momentum. 

AUD/USD daily chart

This week the 0.7725 previous swing acted as resistance as the bulls were unable to push the market above the level. The market remains in a tight range between 0.7642 and 0.7728. The bears want to close the day below Thursday’s low. Although the market is sliding lower, the momentum down is also decelerating as suggested by the RSI and MACD. Bull’s objective is to break above the 0.7725 and 0.7760 swing highs resistances in order to reach the 0.78 psychological level. The bears want a break below 0.7642 cyclical low in order to reach the 0.76 handle and the 0.75 cyclical low. 

AUD/USD 4-hour chart

The market is trading below its 50, 100 and 200 period simple moving averages. While the trend is clearly down the bears are lacking momentum. The AUD/USD is essentially sideways since mid-March and only a clear break below 0.7642 would give traders confidence that much lower prices will come next.