AUDUSD takes out 0.7300 ahead of GDP report, oil continues impressive run
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On Wednesday the economic calendar will spark up the market with high impact data report first from Australia and OPEC-JMMC meetings.
The Aussie which has declined against the US dollar was able to cut back on some losses last week. The pair which opened at 0.71604 and closed at 0.73015 for the week took advantage of a weak dollar which was highly dependent on the outcome of the Jackson Hole symposium for guidance.
This week, traders will keep their focus on Q2 GDP report from Australia. While the country is still on lockdown as the rise of the Covid delta variant is spreading and slowing down economic activities, we will likely see the reflection on Q3 GDP report. For the current quarter GDP report, the economy is expected to expand by 0.5% despite data showing a decline in net exports.
Technical outlook of AUDUSD
AUDUSD 4hour time frame
The Aussie has continued to advance towards 0.73800 after breaking above 0.7300. The resistance ahead might subdue further bullish pressure. A better-than-expected GDP report on Wednesday could force a break out above the near-term resistance.
Can Oil sustain the bullish run towards $77?
Later in the day OPEC-JMMC meeting will put crude oil in the spot light as prices resumed its upward projection from last week. The cartel which agreed to increase oil production to 400k bpd from August till the end of the year might need to reconsider its targets as the rise of the Covid delta variant has slowed down global demand of crude oil with lockdown being imposed by Countries so as to contain the spread.
Oil prices which suffered heavily from the impact of the coronavirus pandemic and the oil price war in 2020 witnessed an upward trajectory into 2021 as OPEC agreed on production cuts accompanied with rising demand from China.
Technical outlook on Brent Crute oil
UK oil Daily time frame
Price has shrugged off the current effect of the Covid variant on oil demand as price closed at $73 pb on Monday, following an impressive run from last week. With a view of $77 which is the high for the year already in sight, the support area around $71 will come in handy for any further push to the upside. However, the outcome of Wednesday’s OPEC meeting could change the whole dynamics
Adegbotolu Kehinde Erastus – Market and Research Analyst
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