AUD/USD Forecast: Could Resume Its Decline If Sentiment Deteriorates, Breaks Below 0.5700

AUD/USD Current Price: 0.5757

• RBA cut rates to record lows, announced the first-ever QE program.
• Australian employment data mixed, but overall indicating health in the sector.
• AUD/USD could resume its decline if sentiment deteriorates, breaks below 0.5700.

The AUD/USD pair is ending a volatile day marginally lower around 0.5750, after falling to 0.5506, its lowest since 2002. The pair fell on the back of RBA’s decision and a mixed employment report. As expected, the central bank trimmed rates by 25bps to 0.25%, a new record low, while also announced the first-ever QE program. The RBA created a $90 billion lending facility to banks for small and medium businesses. In February, the country added 26.7K new jobs, better than the 10K expected, although 20K were part-time jobs. The unemployment rate unexpectedly fell to 5.1%, but the participation rate decreased to 66%. The wide intraday range somehow suggest bears are close to a bottom

AUD/USD short-term technical outlook

The AUD/USD pair recovered to 0.5963 during US trading hours, following the advance in European and American equities, but sellers quickly jumped in. The short-term picture is bearish, as, in the 4-hour chart, the pair retreated from a firmly bearish 20 SMA, while technical indicators have corrected extreme readings before resuming their declines. The pair could retest the mentioned low if it breaks below 0.5700, mainly if sentiment turns sour again.

Support levels:  0.5700 0.5640 0.5590

Resistance levels: 0.5800 0.5850 0.5895

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