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The Australian Dollar rate, probably, decided to start a correction at the Forex currency market on Friday.

Forex forecast: MACD indicator is in the positive area for the pair AUD/USD and continues to go up, due to the large trading volumes, and giving a pair buy signal. Stochastic Oscillator remains in the overbought zone today, giving a similar signal.

Forex recommendations: in case of breakdown at the level of 1.0930 the pair will retest the new highs at 1.0949 and after that it will go further to 1.1000. In case the breakup doesn’t occur, the pair will consolidate near the current levels.

According to the data released today, Private sector credit in Australia increased by 0.6% m/m (+3.6% y/y) in March against the forecast of growth by 3.3% y/y.

Unemployment rate reduced to 4.9% in March versus the preliminary level of 5.0% and employment rate rose by 37.8 thousand last month against the forecast of increase by 24 thousand. Therefore, strong performance in the employment sector pushed the AUD to go upward, instilling investors with the idea that the RBA can resume monetary tightening policy earlier. On the other hand deficit of trade balance was recorded in the country for the first time since spring 2010 (February -?$205 billion against +A$1.4 billion in January). In addition activity index in the service sector reduced to 46.5 points in March against the value of 48.7 points in February.

It became known on Wednesday that CPI in Australia increased by 1.6% on quarterly basis (+3.3% y/y) in QI. Therefore, inflation in the Green Continent has reached five-year highs; natural disasters have triggered the rise in costs for food and other consumption goods for people. In addition, commodity prices at the global markets remain high, because tension in the Middle East does not abate.

It became known in the middle of last week that index of import prices increased by 0.9% on quarterly basis in QI. Index of leading indicators rose by 4.7% y/y in March against the rise by 4.8% in February. It is a good result taking into account that the Reserve Bank of Australia keeps interest rate unchanged for a long time. Leading indicators index demonstrates good growth in the Australian economy: indicators show that growth is unlikely to be too high next year; however there will be some growth.

Kevin Rood, Minister of Foreign Affairs of Australia said yesterday that RBA has no plans to carry out currency intervention, although national currency is considerably overvalued. 

Currently it is obvious that AUD/USD is overbought and needs a rollback.?

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