AUDCAD Outlook (13th March)

The Australian Dollar (AUD) remains under pressure as economic concerns mount. AUDUSD struggles to hold above 0.6500, with resistance at 0.6600. A break below 0.6450 could trigger further declines toward 0.6400.

Fundamental Factors Affecting AUD

Mortgage Arrears & Financial System Risks: The RBA warns that rising mortgage arrears could pose risks to the financial system, though banks are containing broad dangers for now.
Rate Cut Impact: The RBA’s recent rate cut aims to ease pressure, but banks remain cautious in lending, making it harder for borrowers to access credit.
Wage Growth Concerns: Slowing wage growth and a high migration rate continue suppressing real wages, delaying economic recovery.
GDP & Economic Growth: While the latest GDP data shows a slight improvement, per capita GDP remains weak, fueling uncertainty about Australia’s long-term economic trajectory.

Market Reaction & Outlook

The AUD is weighed down by structural economic issues, including weak wage growth and risks of financial instability. Traders will watch upcoming RBA statements and economic data for further direction.

Key Takeaway for Traders

AUDUSD remains bearish in the near term, with downside risks increasing if economic data worsens. Resistance is at 0.6600, while support lies at 0.6450.

AUDCAD – H4 Timeframe

Just before the market surpassed the previous high on the 4-hour timeframe chart of AUDCAD, we saw an initial sweep at the last low. This sweep sets the tone for an SBR pattern and serves as a confluence for the bullish sentiment. The trendline support and the drop-base-rally demand zone are the additional confluences in this case.

AUDCAD – H1 Timeframe

On the 1-hour timeframe chart of AUDCAD, we see that the price has now reached the expected entry area; a conservative approach for entry would be to check for a bullish structure break on the lower timeframes rather than taking immediate market execution.

Analyst’s Expectations:

Direction: Bullish

Target- 0.91127

Invalidation- 0.90015

CONCLUSION

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Author: Adetola-Freeman Ogunkunle

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