AUD/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- AUD/USD dips to 0.66152, facing resistance at 0.6668; supports at 0.6595 hint at a cautious market stance.
- Mixed signals: RSI at 55 and an upward EMA trend counterbalanced by bearish patterns, suggesting a nuanced market outlook.
- Recommended approach: Buy above 0.66035, aiming for 0.66580 with a stop loss at 0.65733, based on current technical indicators.
On March 14, the AUD/USD pair slightly retreated, marking a 0.10% decrease to close at 0.66152. This movement reflects the pair's sensitivity to the latest economic data and shifts in market sentiment.
The technical landscape for AUD/USD is characterized by a mix of bullish and bearish signals. The pair's current position below the pivot point at 0.6658 suggests a cautious market outlook. Immediate resistance levels are located at 0.6668, 0.6698, and 0.6724, which could limit upward moves. On the downside, support is found at 0.6595, followed by 0.6573 and 0.6550, offering potential rebound points.
Technical indicators provide a nuanced view of the pair's future direction. The Relative Strength Index (RSI) stands at 55, indicating a slight bias towards buying pressure, while the 50-day Exponential Moving Average (EMA) at 0.6590 underscores a general uptrend. However, the presence of a double top formation near $0.6640 and a bearish engulfing candle on the 4-hour chart warn of possible selling activity ahead.
Considering these factors, the AUD/USD outlook suggests a cautiously optimistic trend with a recommendation for a buying strategy above 0.66035. Setting a take-profit at 0.66580 and a stop loss at 0.65733 could capitalize on the pair's current momentum while mitigating risks associated with potential downward corrections.
AUD/USD - Trade Ideas
Entry Price – Buy Above 0.66035
Take Profit – 0.66580
Stop Loss – 0.65733
Risk to Reward – 1: 1.8
Profit & Loss Per Standard Lot = +$545/ -$302
Profit & Loss Per Mini Lot = +$54/ -$30
AUD/USD Price Analysis – March 14, 2024
Daily Price Outlook
The AUD/USD currency pair remains under pressure amidst a combination of factors, including the performance of domestic equity markets, Australian economic indicators, and expectations regarding US monetary policy. Meanwhile, the decrease in the NAB Business Confidence Index exert some downward pressure on the AUD/USD pair, but the improvement in the NAB Business Conditions Index could offset this effect to some extent. Traders are closely monitoring developments in economic data releases, central bank announcements, and geopolitical events for further insights into the currency pair's direction.
Although, the losses in the AUD/USD currency pair could be short-lived as the Reserve Bank of Australia (RBA) continues to suggest it may need to raise rates even further. Philip Lowe's statement, along with Michelle Bullock's warning, suggesting potential interest rate increases, could bolster confidence in the Australian dollar, potentially leading to a positive impact on the AUD/USD pair.
Furthermore, the meeting between Wang Yi and Penny Wong could positively impact the AUD/USD pair if discussions lead to progress on economic cooperation, particularly the removal of trade barriers. However, sensitive issues like human rights and regional security could introduce uncertainty, affecting the currency pair negatively.
Australian Economic Data and Central Bank Commentary Impact on AUD/USD Pair
On the data front, Australia's NAB Business Confidence Index dipped to 0 in February, down from 1 in the prior month. This suggests a stall in business sentiment. However, there's a brighter note as the NAB Business Conditions Index rose to 10 from the revised reading of 7 (initially 6). This indicates improved business conditions, likely driven by factors such as economic recovery efforts and increased consumer spending. While the drop in confidence might raise concerns, the uptick in business conditions could provide some reassurance and potentially support economic growth moving forward.
It is worth noting that the Former RBA Governor Philip Lowe stated that there is a two-way risk on interest rates, indicating that rates could either rise or fall. This statement, coupled with current RBA Governor Michelle Bullock's warning that rates might need to increase, suggests a potential strengthening of the Australian dollar (AUD) against the US dollar (USD). If the RBA raises interest rates, it could attract foreign investors seeking higher returns, leading to an increased demand for the AUD. This increased demand could drive up the value of the AUD relative to the USD, making it more positive for the AUD/USD currency pair.
Prospects of Improved Trade Relations Between Australia and China Boost AUD/USD Pair
Another factor that could boost the AUD/USD pair was the upcoming meeting between Chinese Foreign Minister Wang Yi and Australia's Foreign Affairs Minister Penny Wong. The discussions are expected to include economic issues such as the removal of trade barriers, which could benefit both countries and contribute to increased trade activity.
This prospect of improved trade relations between Australia and China could positively impact the Australian dollar (AUD) due to increased demand for Australian exports, potentially strengthening the currency against the US dollar (USD). Additionally, positive outcomes from the meeting may instill confidence in the market, further supporting the AUD/USD pair.
US Dollar Strength and Economic Data Impact on AUD/USD Pair
On the US front, the bullish bias in the US dollar, backed by the hawkish Fed outlook, was seen as a key factor that could cap gains in the AUD/USD pair. Meanwhile, Yellen's cautious outlook on interest rates could bolster the US dollar against the Australian dollar (AUD), as it suggests potential for higher rates. This could attract investors to the USD, diminishing demand for the AUD and weakening the AUD/USD pair. Confidence in fiscal planning assumptions may also influence currency sentiment.
On the data front, US Consumer Price Index (CPI) figures for February showed a year-over-year increase of 3.2%, surpassing estimates and indicating rising inflation. The monthly index met expectations at 0.4%, signaling a consistent trend. Core CPI, excluding volatile food and energy prices, rose 3.8% year-over-year, slightly above expectations. However, the Monthly Budget Statement revealed a deficit of $296 billion in February, lower than expected but significantly higher than the previous month.
AUD/USD - Technical Analysis
On March 14, the AUD/USD pair slightly retreated, marking a 0.10% decrease to close at 0.66152. This movement reflects the pair's sensitivity to the latest economic data and shifts in market sentiment.
The technical landscape for AUD/USD is characterized by a mix of bullish and bearish signals. The pair's current position below the pivot point at 0.6658 suggests a cautious market outlook. Immediate resistance levels are located at 0.6668, 0.6698, and 0.6724, which could limit upward moves. On the downside, support is found at 0.6595, followed by 0.6573 and 0.6550, offering potential rebound points.
Technical indicators provide a nuanced view of the pair's future direction. The Relative Strength Index (RSI) stands at 55, indicating a slight bias towards buying pressure, while the 50-day Exponential Moving Average (EMA) at 0.6590 underscores a general uptrend. However, the presence of a double top formation near $0.6640 and a bearish engulfing candle on the 4-hour chart warn of possible selling activity ahead.
Considering these factors, the AUD/USD outlook suggests a cautiously optimistic trend with a recommendation for a buying strategy above 0.66035. Setting a take-profit at 0.66580 and a stop loss at 0.65733 could capitalize on the pair's current momentum while mitigating risks associated with potential downward corrections.
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AUD/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- AUD/USD's slight increase reflects market hesitation, with key resistance and support levels delineating potential price action.
- RSI and 50 EMA indicators present a neutral to slightly bearish market outlook, suggesting cautious trading.
- The formation of Doji candles below the pivot hints at possible selling, aligning with a cautious bearish trading strategy.
The Australian Dollar against the US Dollar (AUD/USD) saw a minor uptick, registering a 0.03% increase to 0.66156. The currency pair's movement remains constrained, signaling a cautious approach among traders. A detailed look at the four-hour chart reveals a critical pivot point at 0.66162, which the AUD/USD hovers just below, indicating a delicate balance in market sentiment.
Resistance levels are outlined at 0.66506, 0.66856, and 0.67296, suggesting potential hurdles should the pair attempt an upward movement. Conversely, support is established at lower thresholds of 0.65733, 0.65348, and 0.64777, marking zones where declines may be arrested. The Relative Strength Index (RSI) at 57 denotes a neutral market condition, neither overbought nor oversold, supporting the potential for either direction.
Additionally, the 50-day Exponential Moving Average (EMA) at 0.65746, slightly below the current price, could offer a foundation for support. However, the presence of several Doji candles below the pivot point of 0.6616 hints at indecision and a potential tilt towards slight selling pressure.
Given these dynamics, the overall outlook suggests a cautious bearish sentiment for the AUD/USD pair. Traders might consider a selling strategy below the pivot point of 0.66161, targeting a take profit level at 0.65755, with a stop loss placed at 0.66357. This recommendation aligns with the observed technical patterns and the current stance of the market indicators.
AUD/USD - Trade Ideas
Entry Price – Sell Below 0.66161
Take Profit – 0.65755
Stop Loss – 0.66357
Risk to Reward – 1: 2
Profit & Loss Per Standard Lot = +$406/ -$196
Profit & Loss Per Mini Lot = +$40/ -$19
AUD/USD Price Analysis – March 12, 2024
Daily Price Outlook
Despite the bearish US dollar, the AUD/USD currency pair was unable to halt its previous session's losing streak and is still showing sluggish performance around 0.6609. However, the sluggish bias could be attributed to the decrease in the NAB Business Confidence Index, suggesting weakened business sentiment. This could potentially impact the Australian dollar negatively due to reduced investor confidence. Furthermore, the risk-off market sentiment tends to undermine riskier assets like the Australian Dollar (AUD) and has contributed to the AUD/USD pair's losses.
In contrast, the increased trade surplus indicates a strong economy, but the slightly lower-than-expected GDP growth might temper the positive impact on the Australian dollar. Furthermore, the abolition of import tariffs is likely positive for the Australian dollar as it enhances trade efficiency, reduces business costs, and signals economic liberalization, boosting investor confidence in the currency. Meanwhile, the mixed data from China, with CPI beating expectations but PPI falling short, have a neutral impact on the Australian dollar as it reflects both positive and negative economic indicators from Australia's largest trading partner.
Impact of Australian Economic Data on AUD/USD Pair
On the data front, Australia's NAB Business Confidence Index dipped to 0 in February, down from 1 in the previous month, while the NAB Business Conditions Index improved to 10 from 7 (revised from 6). Meanwhile, the Australian Trade Balance surplus rose to $11,027 million in February, slightly below the market's expected increase to $11,500 million. GDP grew by 0.2% QoQ in Q4 2023, slightly below expectations of 0.3%, with YoY expansion at 1.5%, surpassing expectations of 1.4% but falling short of the previous 2.1% growth.
Moreover, Treasurer Jim Chalmers announced the government's plan to abolish nearly 500 import tariffs from July 1, 2024, aiming to streamline trade and save businesses over A$30 million annually in compliance costs.
Therefore, the mixed economic data, including the drop in business confidence and the slight GDP growth miss, weaken the Australian dollar (AUD) against the US dollar (USD). However, the tariff abolition announcement provide some support, potentially limiting the AUD/USD downside.
Impact of Chinese Economic Data on AUD/USD Pair
On the China front, China's Consumer Price Index (CPI) rebounded in February, rising by 0.7% year-over-year after a 0.8% decline in January, surpassing market expectations. Monthly CPI inflation also exceeded expectations, increasing by 1.0% compared to a 0.3% rise in January. However, the Producer Price Index (PPI) dropped by 2.7% year-over-year in February, a larger decline than the 2.5% seen in January and below market expectations.
Therefore, the mixed data from China, with CPI surpassing expectations but PPI weakening, could influence the AUD/USD pair. The CPI rebound might offer support to the Australian dollar (AUD) against the US dollar (USD), while concerns over deflationary pressures from the weaker PPI could weigh on sentiment.
Impact of US Economic Data and Geopolitical Tensions on AUD/USD Pair
On the US front, the weakening US dollar could support the AUD/USD pair as disappointing macro data fuels expectations of rate cuts. Federal Reserve Chair Jerome Powell hinted at potential rate reductions if inflation hovers around 2%, further dampening the dollar. Meanwhile, the upcoming US CPI report could intensify rate cut expectations, impacting dollar. Powell's remarks on inflation's influence on rate cuts add to market uncertainty, creating short-term trading opportunities for gold.
On the geopolitical front, ongoing tensions in the Middle East have created a risk-off market sentiment. This has negatively impacted riskier assets like the Australian Dollar (AUD), keeping the AUD/USD pair under pressure. However, the situation intensified with ongoing Israeli attacks on Gaza, resulting in a high number of casualties and injuries. This instability has contributed to a cautious market environment, affecting currencies like the Australian Dollar.
AUD/USD - Technical Analysis
The Australian Dollar against the US Dollar (AUD/USD) saw a minor uptick, registering a 0.03% increase to 0.66156. The currency pair's movement remains constrained, signaling a cautious approach among traders. A detailed look at the four-hour chart reveals a critical pivot point at 0.66162, which the AUD/USD hovers just below, indicating a delicate balance in market sentiment.
Resistance levels are outlined at 0.66506, 0.66856, and 0.67296, suggesting potential hurdles should the pair attempt an upward movement. Conversely, support is established at lower thresholds of 0.65733, 0.65348, and 0.64777, marking zones where declines may be arrested. The Relative Strength Index (RSI) at 57 denotes a neutral market condition, neither overbought nor oversold, supporting the potential for either direction.
Additionally, the 50-day Exponential Moving Average (EMA) at 0.65746, slightly below the current price, could offer a foundation for support. However, the presence of several Doji candles below the pivot point of 0.6616 hints at indecision and a potential tilt towards slight selling pressure.
Given these dynamics, the overall outlook suggests a cautious bearish sentiment for the AUD/USD pair. Traders might consider a selling strategy below the pivot point of 0.66161, targeting a take profit level at 0.65755, with a stop loss placed at 0.66357. This recommendation aligns with the observed technical patterns and the current stance of the market indicators.
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AUD/USD Price Analysis – March 07, 2024
Daily Price Outlook
Despite geopolitical tensions and concerns about a slowdown in China, the AUDUSD currency pair has maintained an upward trend and remained well bid around the 0.6589 level. The bullish bias can be attributed to the upbeat Australian Trade Balance, which shows an increase slightly below expectations but still having a positive impact on the AUD currency, indicating strong trade performance. Moreover, the strong Chinese trade balance could further support the AUD due to Australia's close economic ties with China.
Furthermore, the upticks in the AUD/USD pair were bolstered by the weakening US dollar, which lost traction due to increasing expectations for an interest rate cut later this year. During a congressional testimony, Federal Reserve Chair Jerome Powell indicated that the Fed is likely to lower interest rates later in the year. This suggests that the Fed is concerned about economic conditions and is taking steps to stimulate the economy by making borrowing cheaper.
Australian and Chinese Economic Data Impact on AUDUSD Pair
On the data front, Australia's economy showed mixed results with fourth-quarter GDP growth at 0.2% QoQ, below the expected 0.3%, while YoY GDP expanded by 1.5%, slightly above expectations. Meanwhile, the Trade Balance surplus fell short, reaching 11,027M in February against the expected 11,500M, with imports rising by 1.3% and exports growing by 1.6%.
Moreover, the AiG Industry Index improved to -14.9, and the Judo Bank Services PMI surged to 53.1, indicating expansion. Despite lower GDP growth, economists from Commerzbank believe the Reserve Bank of Australia (RBA) will delay rate cuts, supporting the Australian Dollar (AUD) for now.
Therefore, the mixed economic data from Australia, including lower-than-expected GDP growth and a trade surplus shortfall, could put some pressure on the AUDUSD pair, but the expectation of delayed rate cuts by the RBA may help support the Australian Dollar.
On the China front, the Trade Balance soared to $125.16B in February, surpassing expectations of $103.7B and the previous $75.34B. Imports and exports both saw year-on-year increases, with imports up by 3.5% and exports rising by 7.1%. This strong performance suggests robust activity in China's trade sector. The impressive trade balance figures from China, along with increased imports and exports, may strengthen the AUDUSD pair as it signals strong economic activity in China, a key trading partner of Australia.
US Dollar Decline and Interest Rate Cut Expectations Impact on AUDUSD Pair
On the US front, the broad-based US dollar continued its decline and remained well offered around 103.23, mainly due to lower US Treasury yields and increasing expectations for an imminent interest rate cut later this year. Federal Reserve Chair Jerome Powell expressed confidence in the US economy, expecting inflation to gradually reach the 2% target. Powell emphasized that the Fed's decisions on interest rates will depend on incoming data.
On a mixed note, Steven Friedman, a former NY Fed economist, warned against rushing to cut interest rates due to strong economic growth and unpredictable inflation. He believes there will be fewer rate cuts in 2024 than people think. Atlanta Fed President Raphael Bostic also expressed doubt about smoothly managing the economy's transition, suggesting two small rate cuts might happen but warned against celebrating victory over inflation too soon.
However, market indicators show a low chance of an interest rate cut in March but higher probabilities for cuts in May and June. Therefore, the AUD/USD pair will likely strengthen due to the US dollar's decline and the possibility of rate cuts, with market indicators suggesting higher probabilities for cuts in May and June.
AUD/USD - Technical Analysis
The AUD/USD pair has exhibited a modest rise of 0.32% to trade at 0.65842, capturing the attention of traders and analysts alike. The pivot point, set at 0.6616, delineates a critical juncture for the currency pair, with immediate resistance levels at 0.6610, 0.6633, and a further resistance at 0.6650 suggesting potential areas of price contention. Conversely, support levels are positioned at 0.6562, 0.6536, and 0.6486, providing a safety net against downward pressures.
Technical indicators provide a clearer picture of the market sentiment. The Relative Strength Index (RSI) stands at 70, edging into overbought territory, which might hint at a potential pullback or consolidation in the near term. The Moving Average Convergence Divergence (MACD) echoes this bullish sentiment, with a value of 0.0009 above the signal line of 0.0002, indicating a possible continuation of upward momentum. The 50-Day Exponential Moving Average (EMA) at 0.6528 further supports this trend, offering a baseline of support.
Given these dynamics, the technical outlook for the AUD/USD remains bullish, suggesting an opportune moment for traders to consider a buy stop at 0.65890. Setting a take profit at 0.66158 and a stop loss at 0.65658 could optimize trade outcomes while managing risk. However, traders should remain vigilant, as the current overbought conditions may signal an impending trend reversal or consolidation phase.
AUD/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
The AUD/USD pair has exhibited a modest rise of 0.32% to trade at 0.65842, capturing the attention of traders and analysts alike. The pivot point, set at 0.6616, delineates a critical juncture for the currency pair, with immediate resistance levels at 0.6610, 0.6633, and a further resistance at 0.6650 suggesting potential areas of price contention. Conversely, support levels are positioned at 0.6562, 0.6536, and 0.6486, providing a safety net against downward pressures.
Technical indicators provide a clearer picture of the market sentiment. The Relative Strength Index (RSI) stands at 70, edging into overbought territory, which might hint at a potential pullback or consolidation in the near term. The Moving Average Convergence Divergence (MACD) echoes this bullish sentiment, with a value of 0.0009 above the signal line of 0.0002, indicating a possible continuation of upward momentum. The 50-Day Exponential Moving Average (EMA) at 0.6528 further supports this trend, offering a baseline of support.
Given these dynamics, the technical outlook for the AUD/USD remains bullish, suggesting an opportune moment for traders to consider a buy stop at 0.65890. Setting a take profit at 0.66158 and a stop loss at 0.65658 could optimize trade outcomes while managing risk. However, traders should remain vigilant, as the current overbought conditions may signal an impending trend reversal or consolidation phase.
AUD/USD - Trade Ideas
Entry Price – Buy Stop 0.65890
Take Profit – 0.66158
Stop Loss – 0.65658
Risk to Reward – 1: 1.6
Profit & Loss Per Standard Lot = +$268/ -$232
Profit & Loss Per Mini Lot = +$26/ -$23
AUD/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
The AUD/USD pair experienced a slight decline on March 5th, settling at 0.65016, marking a 0.11% decrease. This subtle movement reflects the pair's current volatility and the ongoing assessment of its position relative to its pivot point and key technical indicators.
The pivot point, established at 0.6486, delineates the immediate battleground for AUD/USD, with resistance levels positioned at 0.6527, 0.6566, and 0.6608, suggesting areas where upward momentum might face challenges. Support levels at 0.6447, 0.6407, and 0.6365 indicate potential cushioning zones against further declines, outlining critical points for the currency pair's short-term trajectory.
Technical indicators provide a nuanced view of the market's direction. The Relative Strength Index (RSI) at 42 hints at neither overbought nor oversold conditions, suggesting a relatively balanced market sentiment. The MACD's slight crossover above the signal line (Value: -0.0004, Signal: -0.0005) intimates potential for upward momentum, albeit within a context of overall market caution.
The 50-day EMA, stationed at 0.6511, hovers just above the current price, reinforcing a close contest between buyers and sellers. The outlined trading strategy suggests a bearish inclination with an entry price for selling below 0.64939, a take-profit target at 0.64711, and a stop loss set at 0.65086. This setup underscores the anticipation of minor adjustments within a tightly held trading range, indicating a cautious approach amid the current market dynamics.
AUD/USD - Trade Ideas
Entry Price – Sell Below 0.64939
Take Profit – 0.64711
Stop Loss – 0.65086
Risk to Reward – 1: 1.5
Profit & Loss Per Standard Lot = +$228/ -$147
Profit & Loss Per Mini Lot = +$22/ -$14
AUD/USD Price Analysis – March 05, 2024
Daily Price Outlook
Despite the bearish US dollar, the AUD/USD currency pair was unable to halt its previous session's losing streak and remained under pressure around 0.6490. However, the bearish bias could be attributed to the risk-off market sentiment, which tends to undermine riskier assets like the Australian Dollar (AUD) and contributed to the AUD/USD pair's losses. On the other side, the Chinese Services PMI contraction to 52.5 in February from 52.7 prior could potentially impact AUD/USD negatively. This is because Australia's economy is closely tied to China's, and weaker Chinese data may reduce demand for Australian exports, putting pressure on the Australian dollar against the US dollar.
In contrast to this, the positive performance of the Judo Bank Services PMI, reaching a ten-month high and indicating expansion, was seen as a key factor that could help the AUD/USD pair to limit its losses. On the data front, the Judo Bank Services Purchasing Managers Index (PMI) hit a ten-month high of 53.1 in February, signaling expansion. The Composite PMI also rose to 52.1, the highest in nine months. Traders are eagerly anticipating the release of fourth-quarter 2023 Gross Domestic Product (GDP) data on Wednesday.
Australian Economic Indicators and Impact on AUD/USD Pair
Despite the Judo Bank Services Purchasing Managers Index (PMI) surging to a ten-month high of 53.1 in February, indicating expansion, the Australian Dollar remained under pressure. Besides this, the Composite PMI rose to 52.1, marking a nine-month high. However, the Australian Current Account Balance exceeded expectations at 11.8 billion in the fourth quarter of 2023.
According to the Australia Melbourne Institute, inflation slowed to a 4.0% year-over-year rise in February. Additionally, the ANZ-Roy Morgan Australian Consumer Confidence index dropped to 81.0, the lowest in 2024. Building permits and inflation had mixed results, with monthly figures declining but yearly metrics improving.
Meanwhile, the Manufacturing PMI showed a slight uptick to 47.8, while Retail Sales and Private Capital Expenditure improved. Economist Matthew De Pasquale notes the Services PMI's implication of a soft landing in 2023, with a resurgence in early 2024, though inflation's return to target remains uncertain.
Therefore, the impact of the data on the AUD/USD pair could be mixed as positive indicators like the PMI surges and strong current account balance could support the Australian Dollar, potentially leading to an increase in the AUD/USD pair. However, the drop in consumer confidence and uncertainty around inflation could cap gains in the AUD/USD pair.
Impact of Bearish US Dollar and Geopolitical Tensions on AUD/USD Pair
On the other side, the bearish US dollar was another factor that could help the AUD/USD pair. On the US front, the broad-based US dollar continued its declining rally and remained bearish in the wake of disappointing US macro data on Friday, along with less hawkish comments by Federal Reserve officials.
Apart from this, the risk-off market sentiment, pressured by geopolitical tensions, undermined riskier assets like the Australian Dollar (AUD), keeping the AUD/USD currency pair under pressure. The increasing tensions in the Middle East dampened risk sentiment, which affected the Australian Dollar. Since October 7, Israeli attacks on Gaza have injured over 30,000 Palestinians, while Hamas attacks in Israel have killed 1,139 people.
AUD/USD - Technical Analysis
The AUD/USD pair experienced a slight decline on March 5th, settling at 0.65016, marking a 0.11% decrease. This subtle movement reflects the pair's current volatility and the ongoing assessment of its position relative to its pivot point and key technical indicators.
The pivot point, established at 0.6486, delineates the immediate battleground for AUD/USD, with resistance levels positioned at 0.6527, 0.6566, and 0.6608, suggesting areas where upward momentum might face challenges. Support levels at 0.6447, 0.6407, and 0.6365 indicate potential cushioning zones against further declines, outlining critical points for the currency pair's short-term trajectory.
Technical indicators provide a nuanced view of the market's direction. The Relative Strength Index (RSI) at 42 hints at neither overbought nor oversold conditions, suggesting a relatively balanced market sentiment. The MACD's slight crossover above the signal line (Value: -0.0004, Signal: -0.0005) intimates potential for upward momentum, albeit within a context of overall market caution.
The 50-day EMA, stationed at 0.6511, hovers just above the current price, reinforcing a close contest between buyers and sellers. The outlined trading strategy suggests a bearish inclination with an entry price for selling below 0.64939, a take-profit target at 0.64711, and a stop loss set at 0.65086. This setup underscores the anticipation of minor adjustments within a tightly held trading range, indicating a cautious approach amid the current market dynamics.
AUD/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
On February 29, the AUD/USD pair showed modest progress, ascending by 0.18% to reach 0.65167. This slight uptick reflects a tempered optimism in the forex market, as traders digest various global economic indicators and policy decisions.
The currency pair is currently trading just below its pivot point of 0.65258, indicating a critical juncture that could determine the direction of its next move. Resistance levels are set at 0.65579, 0.65829, and 0.66088, marking potential hurdles that the AUD/USD must overcome to sustain its upward trajectory. Conversely, support levels at 0.64904, 0.64698, and 0.64425 provide a safety net, potentially cushioning any downward pressure and serving as key areas for buyers to re-enter the market.
Technical indicators provide further insight into the pair's dynamics. The Relative Strength Index (RSI) stands at 44, suggesting a slight lean towards oversold conditions without fully crossing the threshold, indicating that there might be room for downward movement or consolidation. The 50-day Exponential Moving Average (EMA) at 0.65336, slightly above the current price, signals a potential resistance area that could influence the pair's short-term trend.
AUD/USD - Trade Ideas
Entry Price – Sell Below 0.65291
Take Profit – 0.64897
Stop Loss – 0.65531
Risk to Reward – 1: 1.6
Profit & Loss Per Standard Lot = +$394/ -$240
Profit & Loss Per Mini Lot = +$39/ -$24
AUD/USD Price Analysis – Feb 29, 2024
Daily Price Outlook
Despite the risk-off market sentiment and the bullish US dollar, the AUD/USD currency pair managed to attract some bids and edged higher around the $0.6520 level. However, the upward movement can be attributed to the release of upbeat consumer spending data from Australia on Thursday. Australia's economy grew by 1.1% in January, which is lower than expected but still a positive turn compared to the 2.7% decline in the previous month. This bolstered confidence in the Australian dollar and contributed to the gains in the AUD/USD pair.
In contrast, the risk-off market sentiment, pressured by cautiousness ahead of the release of key US Personal Consumption Expenditures - Price Index data, was seen as a key factor that capped further gains in the AUD/USD pair by undermining riskier assets like the Australian dollar. Another factor that could cap gains in the AUD/USD pair is the bearish Aussie equity market, which opened lower following losses in the tech sector on the final day of company reporting.
Positive Economic Indicators Support the Australian Dollar (AUD)
On the data front, Australian Retail Sales in January increased by 1.1%, a bit lower than expected but a turnaround from the previous decline. Private Capital Expenditure in the fourth quarter of 2023 improved by 0.8%, surpassing expectations. However, Monthly Consumer Price Index (CPI) for January remained steady at 3.4%, slightly below what was anticipated. Construction Work Done also rose by 0.7% in the same quarter, slightly missing expectations. Meanwhile, ANZ-Roy Morgan Australian Consumer Confidence stayed nearly the same at 83.2, marking the 56th straight week below the 85 threshold, just a tad below the weekly average of 83.6 for 2024.
Hence, the positive impact on the AUD currency comes from the increase in Australian Retail Sales and Private Capital Expenditure, indicating economic resilience and potential growth. Despite the steady CPI and slight miss in Construction Work Done, the overall picture suggests underlying strength, which could boost confidence in the Australian economy and support the AUD.
US Dollar Strength and Economic Indicators Impacts on AUD/USD
On the US front, the broad-based US Dollar maintained its upward stance and holding steady, thanks to the higher US Treasury yields. The Federal Reserve is being careful about its next moves and they're talking about the possibility of cutting interest rates later this year, which could help keep the US dollar strong because the delaying rate cuts can be interpreted as a hawkish stance. This means the Fed is confident in the current economic conditions and may be less inclined to provide additional stimulus through rate reductions. This strengthened the US dollar and could cap further gains in the AUD/USD pair.
John Williams, who heads the New York Federal Reserve, says they might cut rates if inflation stays low, but they need to see more data first. Susan Collins, from the Boston Federal Reserve, agrees but wants to be sure before making any moves. Hence, the chances of a rate cut happening in March are pretty low, at just 3.0%, but they go up in May and June.
On the data front, the preliminary US Gross Domestic Product (GDP) for the fourth quarter of 2023 grew by 3.2%, slightly below expectations. The GDP Price Index increased by 1.7%, surpassing expectations. However, the US Housing Price Index rose by only 0.1% in December, lower than expected. Durable Goods Orders fell by 6.1%, worse than expected, while New Home Sales Change grew by 1.5%, below the previous increase. January's New Home Sales reached 0.661 million, missing expectations. These figures indicate mixed performance in the US economy, affecting market sentiments differently.
AUD/USD - Technical Analysis
On February 29, the AUD/USD pair showed modest progress, ascending by 0.18% to reach 0.65167. This slight uptick reflects a tempered optimism in the forex market, as traders digest various global economic indicators and policy decisions.
The currency pair is currently trading just below its pivot point of 0.65258, indicating a critical juncture that could determine the direction of its next move. Resistance levels are set at 0.65579, 0.65829, and 0.66088, marking potential hurdles that the AUD/USD must overcome to sustain its upward trajectory. Conversely, support levels at 0.64904, 0.64698, and 0.64425 provide a safety net, potentially cushioning any downward pressure and serving as key areas for buyers to re-enter the market.
Technical indicators provide further insight into the pair's dynamics. The Relative Strength Index (RSI) stands at 44, suggesting a slight lean towards oversold conditions without fully crossing the threshold, indicating that there might be room for downward movement or consolidation. The 50-day Exponential Moving Average (EMA) at 0.65336, slightly above the current price, signals a potential resistance area that could influence the pair's short-term trend.