As an expert investment manager, I have analyzed the latest trends in the financial market and it seems that the Australian Dollar (AUD) is experiencing a slight decline due to softer net exports and a widening current account deficit. OCBC FX strategists Frances Cheung and Christopher Wong have noted these factors, indicating a potential break below the key level of 0.6730.
According to Cheung and Wong, there is suspicion that the upcoming 2Q GDP print may be lower than expected, which could further impact the AUD. Additionally, a decline in iron ore futures to a 20-month low has also contributed to the weakening of the Australian Dollar.
Currently, the AUD is hovering around the 0.6732 levels, with bullish momentum on the daily chart fading and the RSI falling. A corrective pullback is expected, with support levels at 0.6730 and 0.6660, and resistance levels at 0.6830 and 0.6870. All eyes are on the 2Q GDP release on Wednesday, as a softer print could put further pressure on the AUD.
Analysis and Implications for Investors
For investors and individuals involved in currency trading, it is important to monitor the developments in the Australian Dollar as it faces pressure from economic indicators and external factors. A break below the key level of 0.6730 could signal further weakness in the AUD, potentially leading to trading opportunities for savvy investors.
It is recommended to stay informed about upcoming economic releases, such as the 2Q GDP print, as they can have a significant impact on currency movements. By staying vigilant and conducting thorough analysis, investors can make informed decisions to optimize their financial portfolios and seize profitable opportunities in the market.