FUNDAMENTAL ANALYSIS
Not unlike the Canadian dollar, the aussie’s strength is largely attributed to a rebound in oil and commodity prices.
The recent RBA rate hike and promising economical data portrait a bright future in the long term. Any dip should be considered as a buying opportunity.
Australia's economical outlook remains positive. Its growth is largely attributed to sustained trading activities with China and other Asian partners. The recent IMF upward revision of China's 2011 GDP further strengthens the case of a strong Australian dollar.
On the other hand, the aussie does suffer from worries in Europe and is particularly vulnerable to risk aversion against the dollar. Additional pressure comes from China's efforts to dampen its own inflation.
TECHNICAL ANALYSIS
The 4-hour chart reveals a third bounce off a trendline which has been in formation since late February. On the upside, the price is capped by another trendline which, if breached, would send the aussie for a re-test of .9380.
The pair is well supported above .9000. Any dip down should be considered as a new trading opportunity.
Resistance levels:
- .9340
- .9363
Support levels:
- .9223
- .9157
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