AUD/USD Price Analysis – Dec 12, 2024
Daily Price Outlook
During the European trading session, the AUD/USD currency pair kept its upward momentum, staying strong around the 0.6418 level and reaching a peak of 0.6430.
The Australian dollar remained supported by mixed domestic employment data, with the seasonally adjusted Employment Change showing a rise of 35,600 jobs in November.
This pushed the total number of employed people to 14,535,500, far exceeding the previous figure of 12,100 and the expected 25,000.
Additionally, the Unemployment Rate dropped to 3.9%, the lowest since March, better than the anticipated 4.2%. However, the Australian dollar faced some headwinds as the US dollar strengthened after the release of the US inflation data.
The Consumer Price Index (CPI) in the US rose to 2.7% year-over-year in November, up from 2.6% in October. On top of that, concerns over China’s economic response to potential US tariff hikes added more downward pressure on the AUD.
Impact of Mixed Economic Data and US-China Tensions on the AUD/USD Pair
On the China front, the Australian dollar faced downward pressure as China, a key trading partner of Australia, considered letting its currency, the Chinese Yuan, weaken in response to expected US tariff hikes.
This news added uncertainty, as markets feared the impact of new trade tensions between the US and China.
On Tuesday, Chinese President Xi Jinping expressed confidence in achieving China’s economic targets, stating that China would continue to drive global economic growth. He also warned that there would be no winners in tariff or trade wars.
In terms of economic data, China’s Trade Balance improved in November, reaching CNY 692.8 billion, up from CNY 679.1 billion the previous month.
Exports grew by 1.5% year-over-year, although this was a slowdown compared to October’s 11.2% growth. Imports also rose by 1.2%, recovering from a previous decline of 3.7%.
However, weak consumer price data from China showed a 0.6% drop in November, signaling challenges in the economic recovery and fueling expectations of additional fiscal and monetary stimulus in China.
Back in Australia, the AUD found support from mixed domestic employment data. The seasonally adjusted Employment Change rose by 35,600 in November, bringing the total number of employed people to 14,535,500.
This exceeded both the previous figure of 12,100 and the market’s expectation of 25,000. Additionally, the Unemployment Rate dropped to 3.9%, its lowest level since March, well below the expected 4.2%.
The Reserve Bank of Australia (RBA) kept the official cash rate unchanged at 4.35% in its December meeting, noting that while inflation risks have eased, they still require attention.
Australia's GDP growth for the third quarter was slower than expected, with a 0.3% rise, leading to speculation that the RBA may cut rates in April 2024.
Therefore, the mixed economic data from Australia, along with concerns over China's economic situation, provided support to the AUD.
However, the uncertainty surrounding US-China trade tensions and weak GDP growth led to downward pressure, limiting significant gains in the AUD/USD pair.
AUD/USD – Technical Analysis
The AUD/USD pair is trading at $0.64180, up 0.77%, reflecting a continuation of its bullish momentum on the 4-hour chart. The pair is supported by a strong pivot point at $0.64153, which serves as a critical level for further upside potential.
Immediate resistance is seen at $0.64719, followed by key levels at $0.65030 and $0.65267. A sustained move above these levels could open the door to further gains, targeting higher levels in the short term.
On the downside, immediate support lies at $0.63773, with additional support levels at $0.63460 and $0.63174 offering a safety net against pullbacks. The 50-day Exponential Moving Average (EMA) at $0.63993 is acting as a strong technical base, reinforcing the current uptrend.
The Relative Strength Index (RSI) stands at 63, indicating bullish momentum, though nearing overbought territory. This suggests potential for continued gains, albeit with caution as the pair approaches overextension.
Traders may consider entering long positions above $0.64156, with a target at $0.64576 and a stop loss at $0.63941 to manage downside risks.
Related News
- GOLD Price Analysis – Dec 12, 2024
AUD/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- Resistance Levels: $0.64719, $0.65030, $0.65267.
- Support Levels: $0.63773, $0.63460, $0.63174.
- Technical Indicators: RSI at 63 suggests bullish momentum; 50 EMA at $0.63993 provides strong support.
The AUD/USD pair is trading at $0.64180, up 0.77%, reflecting a continuation of its bullish momentum on the 4-hour chart. The pair is supported by a strong pivot point at $0.64153, which serves as a critical level for further upside potential.
Immediate resistance is seen at $0.64719, followed by key levels at $0.65030 and $0.65267. A sustained move above these levels could open the door to further gains, targeting higher levels in the short term.
On the downside, immediate support lies at $0.63773, with additional support levels at $0.63460 and $0.63174 offering a safety net against pullbacks. The 50-day Exponential Moving Average (EMA) at $0.63993 is acting as a strong technical base, reinforcing the current uptrend.
The Relative Strength Index (RSI) stands at 63, indicating bullish momentum, though nearing overbought territory. This suggests potential for continued gains, albeit with caution as the pair approaches overextension.
Traders may consider entering long positions above $0.64156, with a target at $0.64576 and a stop loss at $0.63941 to manage downside risks.
AUD/USD - Trade Ideas
Entry Price – Buy Above 0.64156
Take Profit – 0.64576
Stop Loss – 0.63941
Risk to Reward – 1: 1.9
Profit & Loss Per Standard Lot = +$420/ -$215
Profit & Loss Per Mini Lot = +$42/ -$21
AUD/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- Bearish Bias: Trading below $0.64289 with immediate support at $0.63729 and further downside likely.
- Resistance Levels: Key resistance at $0.64719, with additional barriers at $0.65030.
- Momentum Indicators: RSI at 39 reflects bearish momentum; 50 EMA at $0.64259 reinforces downward trend.
The AUD/USD pair is trading at $0.63942, down 0.70% in the latest session, pressured by a stronger U.S. Dollar and risk-off sentiment in global markets. The price remains below its pivot point of $0.64289, signaling continued bearish momentum.
The 50-day EMA at $0.64259 serves as a key resistance level, aligning closely with the pivot, further restricting any upward attempts. Meanwhile, the RSI at 39 reflects bearish momentum, but it has yet to reach oversold conditions, leaving room for further declines.
Immediate support is located at $0.63729, with stronger levels at $0.63435 and $0.63174 providing additional safety nets.
On the upside, immediate resistance lies at $0.64719, followed by higher hurdles at $0.65030, presenting challenges for any recovery attempts. The bearish sentiment is further reinforced by the descending trendline, which caps upward moves.
The current setup indicates a high probability of further downside pressure unless the price can reclaim the $0.64289 pivot. A break below $0.63729 could open the door to sharper declines, testing $0.63435 and beyond.
Conversely, a close above $0.64289 would challenge the bearish narrative and target $0.64719 as the next key level.
For traders, selling below $0.64040 with targets near $0.63717 remains a favorable strategy, while maintaining stops above $0.64300 to mitigate risk.
AUD/USD - Trade Ideas
Entry Price – Sell Below 0.64040
Take Profit – 0.63717
Stop Loss – 0.64300
Risk to Reward – 1: 1.2
Profit & Loss Per Standard Lot = +$323/ -$260
Profit & Loss Per Mini Lot = +$32/ -$26
AUD/USD Price Analysis – Dec 10, 2024
Daily Price Outlook
During the European trading session, the AUD/USD pair continued to struggle, staying under pressure near 0.6394. This drop came after the Reserve Bank of Australia (RBA) decided to keep the Official Cash Rate (OCR) at 4.35% during its final policy meeting of the year.
RBA Governor Michele Bullock, addressing the media, explained why the central bank held the rate steady at its 12-year high for the ninth straight meeting in December.
On the other side, the US Dollar remained strong, marking its third day of gains. This was driven by cautious market sentiment ahead of the US Consumer Price Index (CPI) data release on Wednesday.
According to the CME FedWatch Tool, traders are betting on an 85.8% chance of the Federal Reserve reducing rates by 25 basis points in its December 18 meeting.
On the bright side for the Aussie Dollar, China’s improved economic sentiment provided some relief. Chinese leaders announced plans for proactive fiscal measures and looser monetary policies in 2024 to boost domestic consumption, offering a glimmer of hope for Australia’s trade-reliant economy.
RBA's Steady OCR and China's Economic Stimulus Create Mixed Outlook for AUD/USD
As we mentioned, the Reserve Bank of Australia (RBA) decided to keep its Official Cash Rate (OCR) at 4.35% during its final meeting of the year.
This marks the ninth consecutive meeting at this 12-year high, as Governor Michele Bullock emphasized the need to stay vigilant about inflation risks despite some improvement.
Australia’s economy faces challenges, with GDP growth slowing to 0.3% in the September quarter, missing expectations.
Meanwhile, unemployment remained steady at 4.1% in October, with a modest addition of 15,900 jobs. Inflation eased slightly to 3.5% in the third quarter but remains above the RBA’s 2%-3% target, fueling debates over potential rate cuts next April.
China’s economic developments also influenced the Australian Dollar (AUD). Chinese President Xi Jinping expressed confidence in achieving economic targets, reinforcing China’s role as a global growth driver.
Although China’s trade balance improved to CNY 692.8 billion in November, exports and imports grew at slower rates compared to October.
In the meantime, the weak inflation data (-0.6% in November) highlights challenges but has led to expectations of further stimulus.
Chinese leaders plan to boost domestic consumption in 2024 through fiscal and monetary policies, which has supported AUD sentiment, given Australia’s strong trade ties with China.
Therefore, the RBA's decision to maintain the OCR at 4.35% and China's economic stimulus plans have mixed effects on the AUD/USD pair.
While China's stimulus expectations support the AUD, Australia's economic slowdown and inflation risks keep the pair under pressure, limiting gains.
AUD/USD – Technical Analysis
The AUD/USD pair is trading at $0.63942, down 0.70% in the latest session, pressured by a stronger U.S. Dollar and risk-off sentiment in global markets. The price remains below its pivot point of $0.64289, signaling continued bearish momentum.
The 50-day EMA at $0.64259 serves as a key resistance level, aligning closely with the pivot, further restricting any upward attempts. Meanwhile, the RSI at 39 reflects bearish momentum, but it has yet to reach oversold conditions, leaving room for further declines.
Immediate support is located at $0.63729, with stronger levels at $0.63435 and $0.63174 providing additional safety nets.
On the upside, immediate resistance lies at $0.64719, followed by higher hurdles at $0.65030, presenting challenges for any recovery attempts. The bearish sentiment is further reinforced by the descending trendline, which caps upward moves.
The current setup indicates a high probability of further downside pressure unless the price can reclaim the $0.64289 pivot. A break below $0.63729 could open the door to sharper declines, testing $0.63435 and beyond.
Conversely, a close above $0.64289 would challenge the bearish narrative and target $0.64719 as the next key level.
For traders, selling below $0.64040 with targets near $0.63717 remains a favorable strategy, while maintaining stops above $0.64300 to mitigate risk.
Related News
- GOLD Price Analysis – Dec 10, 2024
AUD/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- Bearish Bias: RSI at 43 and resistance at $0.64712 signal limited upward momentum in the short term.
- Levels: Break below $0.64472 targets $0.64154 and $0.63763; upside capped near $0.65259.
- Trading Strategy: Sell below $0.64473, aiming for $0.63959, with a stop-loss at $0.64775 to manage potential reversals.
AUD/USD is trading at $0.64402, up 0.16% during the session, showing mild bullish momentum while hovering near the pivot point at $0.64472.
The pair is navigating a cautious market, with immediate resistance at $0.64927, followed by higher levels at $0.65259 and $0.65575.
On the downside, support lies at $0.64154, with additional levels at $0.63763 and $0.63475, marking critical areas to watch for potential bearish moves.
Technical indicators highlight a mixed outlook. The RSI at 43 reflects a lack of strong momentum, leaning slightly toward bearish sentiment.
The 50-day EMA at $0.64712 acts as a resistance barrier, keeping upward movements in check. A failure to break above this EMA may signal continued pressure on the pair.
Price action suggests traders should watch for a potential breakdown below the pivot point of $0.64472, which could expose AUD/USD to lower support levels around $0.64154.
The pair’s performance aligns with broader market themes, including Federal Reserve policy expectations and commodity price dynamics. Entry is recommended below $0.64473 for short positions, targeting $0.63959 with a stop-loss set at $0.64775 to mitigate risk.
On the flip side, a sustained move above $0.64927 could trigger bullish momentum, though current indicators favor a neutral-to-bearish trajectory.
AUD/USD - Trade Ideas
Entry Price – Sell Below 0.64473
Take Profit – 0.63959
Stop Loss – 0.64775
Risk to Reward – 1: 1.7
Profit & Loss Per Standard Lot = +$514/ -$302
Profit & Loss Per Mini Lot = +$51/ -$30
AUD/USD Price Analysis – Dec 05, 2024
Daily Price Outlook
The AUD/USD pair continues to struggle, staying under pressure near the 0.6421 mark. The main reason for its downward trend seems to be weak Australian economic data and growing expectations that the Reserve Bank of Australia (RBA) might cut interest rates soon, which has been dragging the Aussie lower.
Additionally, worries about potential tariffs on imports from President-elect Donald Trump are adding to the pressure on the AUD.
Traders are closely watching the upcoming US data, including the Initial Jobless Claims and Goods Trade Balance report on Thursday, for any new clues. If the US labor market shows signs of weakness, it could weaken the US dollar and ease the losses for the pair.
On Friday, the US Nonfarm Payrolls (NFP) report for November will be in focus, as it could give a clear direction for the market.
Mixed Economic Data and RBA Rate Cut Expectations Weigh on AUD/USD Pair
On the data front, Australia’s trade surplus rose to 5.953 billion AUD in October, up from 4.532 billion AUD in September (revised from 4.609 billion AUD). This was better than the expected 4.500 billion AUD, showing a positive trade performance.
However, Australia’s GDP growth for the third quarter (Q3) was only 0.3% compared to 0.2% in the previous quarter (Q2). This was below the market expectation of 0.4% growth, signaling weaker-than-expected economic performance.
In contrast, Australia’s Judo Bank Services PMI improved to 50.5 in November from 49.6 in October, surpassing the forecast of 49.6. While this suggests some growth in the services sector, the overall economic data has been disappointing.
This, along with rising expectations of an interest rate cut by the Reserve Bank of Australia (RBA), has been pushing the Australian dollar (AUD) lower.
On top of that, concerns over potential tariffs on imports from President-elect Donald Trump are adding to the pressure on the AUD. These factors combined make the outlook for the Aussie currency appear uncertain.
Therefore, the mixed economic data, along with expectations for an RBA rate cut and concerns over potential tariffs, have put pressure on the Australian dollar. This has contributed to the ongoing weakness of the AUD/USD pair, pushing it lower.
US Economic Data Shows Slower Growth, Fed Signals Possible Slowdown in Rate Cuts
On the US economic data front, the ISM Services PMI dropped to 52.1 in November, down from 56.0 in October. This was weaker than the expected 55.5, indicating a slowdown in the services sector.
Similarly, the S&P Global Composite PMI fell to 54.9 from 55.3, and the Services PMI decreased to 56.1 from 57.0. All of these figures were below expectations, pointing to a slowdown in economic activity.
Despite this, Fed Chair Jerome Powell stated that the US economy is performing stronger than expected, allowing the Federal Reserve to possibly slow down the pace of interest rate cuts.
He mentioned that the economy is in a better position than when the Fed started reducing rates in September. Additionally, San Francisco Fed President Mary Daly emphasized that the central bank doesn’t need to rush with rate cuts, as there is still work to be done to reach 2% inflation and sustained growth.
The CME FedWatch Tool suggests there is a 77.5% chance that the Fed will cut rates by 0.25% in December, while a 22.5% chance remains for no change.
Traders will closely watch the US Initial Jobless Claims and Goods Trade Balance reports on Thursday for any new signs of weakness. The US Nonfarm Payrolls (NFP) report on Friday will also be key for market direction.
Therefore, the weaker US economic data may limit the US dollar's strength, potentially offering some support for the Australian dollar (AUD). However, ongoing rate cut expectations from the Reserve Bank of Australia (RBA) could keep the AUD/USD pair under pressure.
AUD/USD – Technical Analysis
AUD/USD is trading at $0.64402, up 0.16% during the session, showing mild bullish momentum while hovering near the pivot point at $0.64472.
The pair is navigating a cautious market, with immediate resistance at $0.64927, followed by higher levels at $0.65259 and $0.65575.
On the downside, support lies at $0.64154, with additional levels at $0.63763 and $0.63475, marking critical areas to watch for potential bearish moves.
Technical indicators highlight a mixed outlook. The RSI at 43 reflects a lack of strong momentum, leaning slightly toward bearish sentiment.
The 50-day EMA at $0.64712 acts as a resistance barrier, keeping upward movements in check. A failure to break above this EMA may signal continued pressure on the pair.
Price action suggests traders should watch for a potential breakdown below the pivot point of $0.64472, which could expose AUD/USD to lower support levels around $0.64154.
The pair’s performance aligns with broader market themes, including Federal Reserve policy expectations and commodity price dynamics. Entry is recommended below $0.64473 for short positions, targeting $0.63959 with a stop-loss set at $0.64775 to mitigate risk.
On the flip side, a sustained move above $0.64927 could trigger bullish momentum, though current indicators favor a neutral-to-bearish trajectory.
Related News
- GOLD Price Analysis – Dec 05, 2024
AUD/USD Price Analysis – Dec 03, 2024
Daily Price Outlook
During the European trading session, the AUD/USD pair managed to stop its decline and found some bullish momentum around the 0.6490 mark, reaching a high of 0.6505.
However, the US Dollar, which surged to a three-day high, initially pushed the pair lower. Nevertheless, the hawkish comments from Reserve Bank of Australia (RBA) Governor Michele Bullock helped the AUD/USD pair to limit its deeper losses.
On top of this, the ongoing concerns about a global trade war if Donald Trump returns as US President could weigh on market sentiment, which ultimately undermine the riskier Aussie. Looking ahead, traders are closely watching the upcoming US data, including the JOLTs Job Openings for October.
Moreover, Federal Reserve officials Adriana Kugler and Austan Goolsbee are scheduled to speak, providing further insights into monetary policy. On the Australian side, the third-quarter GDP figures, due for release on Wednesday, could offer more direction for the Aussie.
Mixed Economic Data Creates Volatility for AUD/USD Pair
On the data front, Australia’s current account deficit for the third quarter came in higher than expected, reaching A$14.1 billion. This was an improvement from the A$16.4 billion deficit in the second quarter, which was revised from a previous figure of A$10.7 billion.
The result was worse than analysts’ forecast of a A$10.0 billion shortfall. Meanwhile, Australia’s retail sales grew by 0.6% in October compared to a 0.1% rise in September. This beat expectations of a 0.3% increase, indicating stronger consumer spending.
On the US front, the ISM Manufacturing PMI rose to 48.4 in November from 46.5 in October, showing a stronger-than-expected recovery. This was above the market’s forecast of 47.5, signaling some improvement in the manufacturing sector.
On the Fed’s side, there were mixed signals regarding future rate cuts. Atlanta Fed President Raphael Bostic said he's unsure if a rate cut is needed in December but believes rates should be lowered in the months ahead.
Meanwhile, New York Fed President John Williams suggested that more rate cuts could be necessary to bring policy to a neutral stance, now that inflation and employment risks are more balanced.
Fed Governor Christopher Waller also indicated he was leaning towards supporting a rate cut in December, expecting inflation to continue easing toward the Fed's 2% target.
The stronger US manufacturing data and mixed Fed signals could add pressure on the AUD/USD pair, increasing volatility.
Therefore, the mixed data, with a higher-than-expected current account deficit in Australia and stronger US manufacturing data, could weigh on the AUD/USD pair. The uncertainty around Fed rate cuts and Australia's retail sales boost may limit AUD losses, leading to volatility.
AUD/USD – Technical Analysis
The AUD/USD pair dipped slightly, trading at $0.64696, down 0.07% for the session. The price action has remained below the pivot point of $0.65259, signaling ongoing bearish momentum on the 4-hour chart.
The pair's proximity to the 50 EMA, which is currently at $0.64931, highlights a consolidation phase, though sellers maintain a slight edge.
Immediate resistance lies at $0.65575, with further levels at $0.65973. These levels represent potential barriers for any corrective upward moves. Conversely, immediate support is located at $0.64497, a breach of which could extend losses toward $0.64154 and $0.63763.
The RSI, currently at 42, underscores the bearish tone, indicating that selling pressure is outweighing buying interest but has yet to reach oversold territory.
The technical structure favors a short-term sell strategy, particularly if prices remain below $0.64813. A suggested trade setup involves entering short positions below this level, targeting a move toward $0.64150, while managing risk with a stop-loss at $0.65328.
This approach aligns with the pair’s downward trajectory and the broader bearish market sentiment.
Related News
- GOLD Price Analysis – Dec 03, 2024
AUD/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- Support and Resistance: Immediate resistance is at $0.65575, while immediate support lies at $0.64497, with further downside targets at $0.64154.
- Trend Indicators: Price trades below the 50 EMA ($0.64931), reinforcing a bearish bias; RSI at 42 signals further downside potential.
- Trade Setup: Short positions below $0.64813 with a take-profit target of $0.64150 and a stop-loss at $0.65328.
The AUD/USD pair dipped slightly, trading at $0.64696, down 0.07% for the session. The price action has remained below the pivot point of $0.65259, signaling ongoing bearish momentum on the 4-hour chart.
The pair's proximity to the 50 EMA, which is currently at $0.64931, highlights a consolidation phase, though sellers maintain a slight edge.
Immediate resistance lies at $0.65575, with further levels at $0.65973. These levels represent potential barriers for any corrective upward moves. Conversely, immediate support is located at $0.64497, a breach of which could extend losses toward $0.64154 and $0.63763.
The RSI, currently at 42, underscores the bearish tone, indicating that selling pressure is outweighing buying interest but has yet to reach oversold territory.
The technical structure favors a short-term sell strategy, particularly if prices remain below $0.64813. A suggested trade setup involves entering short positions below this level, targeting a move toward $0.64150, while managing risk with a stop-loss at $0.65328.
This approach aligns with the pair’s downward trajectory and the broader bearish market sentiment.
AUD/USD - Trade Ideas
Entry Price – Sell Below 0.64811
Take Profit – 0.64150
Stop Loss – 0.65328
Risk to Reward – 1: 1.2
Profit & Loss Per Standard Lot = +$661/ -$517
Profit & Loss Per Mini Lot = +$66/ -$51
AUD/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- Critical Pivot: AUD/USD remains bearish below $0.65014; a break above $0.65456 is required for a bullish reversal.
- Resistance Levels: Immediate resistance at $0.65918, with stronger barriers near $0.66399.
- Support Levels: Key support at $0.64497; a breach below $0.64154 could accelerate selling pressure.
AUD/USD is trading at $0.64824, down 0.21%, as bearish sentiment continues to dominate below the $0.65014 pivot point. The 4-hour chart indicates immediate resistance at $0.65918, with additional barriers at $0.66399.
The 50-day EMA at $0.64987 reinforces short-term resistance, limiting upward momentum. A breakout above $0.65456, the key pivot level, would be required to shift the bias toward bullish territory, potentially targeting $0.65918 and beyond.
On the downside, immediate support is found at $0.64497, with further declines targeting $0.64154 and $0.63763. The RSI at 48 suggests a neutral stance, leaning slightly bearish, with no immediate oversold signals. However, continued pressure below the pivot could drive the pair toward lower support zones.
Current trends suggest sellers remain in control, especially if the price sustains below $0.65052. Traders are advised to consider selling below this level, with a take-profit target at $0.64488 and a stop-loss at $0.65504 to manage risk.
The short-term outlook hinges on whether AUD/USD can break above the $0.65456 pivot.
AUD/USD - Trade Ideas
Entry Price – Sell Below 0.65052
Take Profit – 0.64488
Stop Loss – 0.65504
Risk to Reward – 1: 1.2
Profit & Loss Per Standard Lot = +$564/ -$452
Profit & Loss Per Mini Lot = +$56/ -$45
AUD/USD Price Analysis – Nov 28, 2024
Daily Price Outlook
During the European trading session, the AUD/USD currency pair managed to halt its downward trend and regained some traction around the 0.6505 level, reaching an intraday high of 0.6510.
This uptick was largely driven by a brief bounce in the US Dollar, which had fallen to a two-week low previously. However, the US dollar quickly regained positive momentum, aided by recent US economic data.
The data highlighted a resilient economy and slower progress in inflation, which suggests that the Federal Reserve may adopt a more cautious approach towards further rate cuts. This outlook helped lift US Treasury yields, boosting demand for the USD and putting some pressure back on the AUD/USD pair.
US Dollar Rebounds on Strong Economic Data and Inflation Outlook, Pressuring AUD/USD
On the US front, the broad-based US dollar maintained its upward trend and bounced back from a two-week low, thanks to stronger economic data.
The US economy showed resilience with signs of slowing inflation, which suggests that the Federal Reserve might be more cautious about cutting interest rates further. This helped push US Treasury bond yields higher, boosting demand for the dollar.
On the data front, the latest US economic reports played a key role in this shift. The Personal Consumption Expenditures (PCE) Price Index rose to 2.3% in October, up from 2.1% in September.
The core PCE, which excludes food and energy prices, also saw a slight increase, rising to 2.8% from 2.7%. Meanwhile, US GDP grew at a healthy 2.8% annual rate in the third quarter, driven by strong consumer spending, which rose by 3.5%. Jobless claims also fell by 2,000 to 213,000, signaling a solid labor market.
However, there was a slight disappointment with October's Durable Goods Orders, which only rose by 0.2%, missing expectations of a 0.5% increase.
Excluding transportation, the rise was even smaller, at 0.1%. Despite this, concerns over inflation and the potential impact of future policies under President-elect Donald Trump, combined with the latest Federal Reserve minutes, gave the dollar an edge.
The rebound in US Treasury yields also helped support the dollar, putting some upward pressure on AUD/USD pair.
AUD/USD Faces Pressure Amid Economic Concerns and Global Tensions, But RBA's Hawkish Stance Provides Support
On the other hand, the gains in the AUD/USD pair were also supported by stronger-than-expected data on Private Capital Expenditure in Australia. Australia's new capital expenditure rose by 1.1% in the third quarter, surpassing market expectations of a 0.9% increase.
This rebound followed a 2.2% decline in the previous quarter, showing some strength in the Australian economy. However, despite this positive data, the Australian Dollar remained subdued against the US Dollar, partly due to reduced trading activity ahead of the US Thanksgiving holiday.
Looking ahead, the AUD/USD pair may face downward pressure as the US plans to introduce new measures aimed at limiting China’s progress in artificial intelligence technology.
Given the strong trade links between Australia and China, any economic changes in China could have a significant impact on Australian markets, possibly weakening the Australian Dollar.
Furthermore, the market sentiment was dampened after President-elect Donald Trump's announcement of a 10% tariff hike on all Chinese goods entering the US.
However, the downside for the AUD was limited by the Reserve Bank of Australia's (RBA) hawkish stance on future interest rates. Australia's monthly Consumer Price Index (CPI) rose by 2.1% year-over-year in October, staying within the RBA's target range of 2-3%.
Although this was slightly below expectations of 2.3%, it marked the lowest inflation rate since July 2021 and helped support the Australian Dollar in the face of global economic concerns.
AUD/USD – Technical Analysis
AUD/USD is trading at $0.64824, down 0.21%, as bearish sentiment continues to dominate below the $0.65014 pivot point. The 4-hour chart indicates immediate resistance at $0.65918, with additional barriers at $0.66399.
The 50-day EMA at $0.64987 reinforces short-term resistance, limiting upward momentum. A breakout above $0.65456, the key pivot level, would be required to shift the bias toward bullish territory, potentially targeting $0.65918 and beyond.
On the downside, immediate support is found at $0.64497, with further declines targeting $0.64154 and $0.63763. The RSI at 48 suggests a neutral stance, leaning slightly bearish, with no immediate oversold signals. However, continued pressure below the pivot could drive the pair toward lower support zones.
Current trends suggest sellers remain in control, especially if the price sustains below $0.65052. Traders are advised to consider selling below this level, with a take-profit target at $0.64488 and a stop-loss at $0.65504 to manage risk.
The short-term outlook hinges on whether AUD/USD can break above the $0.65456 pivot.
Related News
- GOLD Price Analysis – Nov 28, 2024