AUDUSD Technical Analysis | Forexlive

USD

• The Fed left interest rates unchanged as expected at the last meeting, with virtually no change in its statement. The Dot Plot still shows three rate cuts for 2024 and the economic projections have been improved with higher growth and inflation and lower unemployment.
• The US CPI beat expectations for the third consecutive month, while the US PPI was in line with forecasts.
• U.S. NFP beat expectations across the board, although average hourly earnings were in line with forecasts.
• The US ISM Manufacturing PMI significantly exceeded expectations, as the price component continued to rise, while the US ISM Services PMI missed expectations, with the price index falling to a 4-year low.
• U.S. retail sales far exceeded expectations across the board, with positive revisions from previous figures.
• The market now expects a first rate cut in September.

EUR

• The RBA left interest rates unchanged as expected at the last meeting and finally abandoned its tightening trend.
• The latest monthly CPI report was in line with expectations, although the core inflation measure rose from the previous month.
• The latest labor market report far exceeded expectations.
• The Wage Price Index surprised to the upside as Australia’s wage growth remains strong.
• The latest Australian PMIs showed that the manufacturing PMI continues to contract, while the services PMI continues to rise and remains expanding.
• The market expects a first rate cut in November.

AUDUSD Technical Analysis – Daily Timeline

On the daily chart, we can see that AUDUSD fell below the 0.6440 low and extended the sell-off to the 0.64 handle. The price is a bit excessive, as shown by the distance from the blue 8 moving average. In such cases, we can usually see a pullback towards the moving average or some consolidation before the next move. In this case, the pullback would also coincide with support-turned-resistance and the 38.2% Fibonacci retracement level, which will be an interesting area for sellers to re-enter the market with a better risk to reward setup.

AUDUSD Technical Analysis – 4 Hour Timeframe

On the 4-hour chart we can see that we have a minor trendline defining the current bearish momentum, with the blue 8 moving average acting as dynamic resistance. We can expect sellers to build on this trendline with risk set above it to position themselves for further decline. Buyers, on the other hand, will want to see the price move higher to position themselves for a rally into the 0.65 resistance zone.

AUDUSD Technical Analysis – 1 Hour Timeframe

On the hourly chart, we can see that price has diverged with the MACD, which is usually a sign of weakening momentum, often followed by pullbacks or reversals. In this case, if they get a pullback, sellers should rely on the trendline where they will also find the confluence of the trendline, Fibonacci retracement levels and the red 21 moving average. price were to move higher, the reversal would be confirmed and buyers would gather for a rally into the 0.65 resistance zone.

Events to come

On Thursday we will receive Australian employment data and the latest US jobless claims figures.