Since the beginning of the year the Australian dollar has begun a steady growth, which led to the formation of a new uptrend. This was unexpected for many investors who thought the AUD is overvalued, taking into account the recession in the Australian economy, in particular the decreasing of the business activity index to 5, as well as the decrease of the prices for mining companies' shares in Australia.
The main reason for the growth of the Australian currency was the canadian dollar, which during this time did not exert any pressure on the AUD. Canada's economy is stable, though it doesn't show growth. However, the unstable oil market, the risks of further decreases in oil prices and the USD rates have added pressure on the CAD value.
Despite worries about an overvalued Australian dollar, it looks healthy enough and keeps on growing. This was confirmed by the Reserve Bank of Australia who believes the slowdown in growth is only temporary and expects an improvement in economic indicators. So at its recent meeting the RBA chose to leave interest rates unchanged, thereby maintaining the currency at a high level. In addition, information about the growth of China's economy has had a positive impact since it has good perspectives for increasing export volumes. At this time, the MACD and Stochastics oscillators are neutral. The most optimal course of action in this situation is to open deals on the trend in medium-term trading.
