AUD/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- AUD/USD is trading below the key support of $0.6754, now acting as resistance.
- RSI at 33.73 indicates oversold conditions, signaling potential short-term rebounds.
- Bearish momentum could continue towards $0.6720 and beyond if selling pressure persists.
The Australian Dollar (AUD/USD) is currently trading around $0.6742, showing signs of a bearish continuation following a recent breakdown. The pair is under pressure as it trades below the key support level of $0.6754, now acting as immediate resistance. The breakdown below this level has opened the door for further declines towards the next support levels.
The pivot point for today’s session is at $0.6754, which also marks the immediate resistance. Should the pair attempt a recovery, it may find resistance at $0.6770, with the next levels of resistance at $0.6784 and $0.6793. On the downside, immediate support lies at $0.6720, followed by $0.6699 and $0.6677.
Technical indicators are pointing towards continued bearish momentum. The Relative Strength Index (RSI) is currently at 33.73, indicating oversold conditions, which could suggest a potential short-term rebound before the downtrend resumes. The 50-day Exponential Moving Average (EMA) is positioned at $0.6784, reinforcing the resistance around this level.
Given the recent price action and the technical indicators, a sell position below $0.6754 could be considered, with a take profit target at $0.6720 and a stop loss set at $0.6770 to manage risk. The breakdown below key support levels suggests that the bears are in control, and the pair could see further declines if it remains below the $0.6754 pivot point.
AUD/USD - Trade Ideas
Entry Price – Sell Below 0.67540
Take Profit – 0.67200
Stop Loss – 0.67700
Risk to Reward – 1: 2
Profit & Loss Per Standard Lot = +$340/ -$160
Profit & Loss Per Mini Lot = +$34/ -$16
GOLD Price Analysis – Sep 03, 2024
Daily Price Outlook
Gold prices (XAU/USD) continue their decline, trading around the 2490 level. However, this drop is attributed to a stronger US Dollar and rising US Treasury bond.
However, expectations of a potential US Federal Reserve (Fed) rate cut in September could support gold prices, as lower interest rates reduce the opportunity cost of holding non-yielding gold. Furthermore, ongoing geopolitical tensions in the Middle East may drive demand for gold as a safe-haven asset.
Looking ahead, the Institute for Supply Management’s (ISM) Manufacturing Purchasing Managers Index (PMI) is set for release on Tuesday.
The key event this week will be the August US Nonfarm Payrolls (NFP) report, which could influence the Federal Reserve's decision on interest rate cuts and, in turn, affect gold prices in the short term.
Impact of Recent US Economic Data and Federal Reserve Expectations on Gold Prices
On the US front, the broad-based US dollar (USD) strengthened, and US Treasury bond yields rose on Tuesday as the US Bureau of Economic Analysis reported that the headline Personal Consumption Expenditures (PCE) Price Index increased by 2.5% year-over-year in July, matching the previous figure but missing the estimated 2.6%.
In the meantime, the core PCE, excluding food and energy, also rose by 2.6%, consistent with prior data but slightly below the forecast of 2.7%. Moreover, the US Gross Domestic Product (GDP) grew at an annualized rate of 3.0% in Q2, surpassing expectations of 2.8%. Initial Jobless Claims for the week ending August 23 fell to 231,000, slightly below the anticipated 232,000.
On the other hand, markets are currently pricing in a nearly 69% chance of a 25 basis points (bps) rate cut by the Federal Reserve in September, with a 31% probability for a 50 bps reduction.
Moving ahead, the US ISM Manufacturing PMI for August is expected to improve to 47.5 from 46.8 in July, while the Services PMI may decline to 51.1 from 51.4. Job additions for August are forecasted at 163,000, with the Unemployment Rate expected to decrease slightly to 4.2%.
Therefore, the stronger US dollar and higher Treasury yields could pressure gold prices down. However, expectations for a Fed rate cut and weaker PMI data might support gold, as lower rates reduce the opportunity cost of holding non-yielding assets.
GOLD (XAU/USD) - Technical Analysis
Gold is currently trading around $2,503, facing a critical juncture on the 2-hour chart. After breaking down from an ascending triangle pattern, the price has been hovering near the $2,503 level, struggling to reclaim its previous bullish momentum. This breakdown is significant as the ascending triangle was providing support around the $2,507 level, and the recent price action suggests that the bears are gaining control.
On the technical front, the pivot point is situated at $2,507, which is now acting as a critical resistance. Immediate resistance stands at $2,508, followed by stronger resistance levels at $2,514 and $2,517. On the downside, the immediate support is at $2,491, with subsequent support levels at $2,480 and $2,471. The 50 EMA, currently positioned at $2,508, is acting as a ceiling for the price, preventing any meaningful recovery.
The Relative Strength Index (RSI) is currently at 44.41, indicating neutral momentum but with a slight tilt towards oversold conditions. This could imply a potential reversal or consolidation phase if the selling pressure continues to mount. However, the key to watch is whether the price can break back above the 50 EMA at $2,508, which could signal a shift in momentum.
In conclusion, Gold's recent breakdown from the ascending triangle pattern around the $2,507 mark has opened the door for further downside potential. If the price remains below $2,507, the bearish momentum could accelerate, targeting the next support at $2,491 and potentially down to $2,480 or even $2,471.
Conversely, a recovery above $2,508 could challenge resistance levels at $2,514 and $2,517. For traders, an entry point could be considered at a sell position below $2,507, with a take profit target set at $2,492 and a stop loss at $2,517 to manage risk effectively.
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AUD/USD Price Analysis – Aug 29, 2024
Daily Price Outlook
During the European trading session, the AUD/USD currency pair maintained its upward trend and remained well bid around the 0.6821 level, hitting an intra-day high of 0.6825.
This upward trend can be attributed to several factors, including a bearish US dollar, which lost traction due to the US Federal Reserve signaling that lower interest rates are likely on the horizon.
Additionally, hotter-than-expected Australian CPI inflation data have pushed back expectations of a rate cut by the Reserve Bank of Australia (RBA), providing some support to the Aussie.
Traders are now looking ahead to US Jobless Claims and Gross Domestic Product (GDP) data, set to be released on Thursday, for more clarity on the projected path of US interest rates.
Australian Dollar Strengthens Amid Mixed Economic Signals
On the AUD front, the Australian dollar (AUD) gained strength against the US dollar (USD) following hotter-than-expected inflation data. The country’s Consumer Price Index (CPI) eased to 3.5% in July from 3.8% in June, matching forecasts.
This unexpected inflation level led investors to push back their expectations for a Reserve Bank of Australia (RBA) rate cut, providing support to the AUD/USD pair.
In addition, Australia’s private capital spending fell by 2.2% in Q2, a sharp decline from a 1.0% increase in the previous quarter and worse than the 1.0% growth expected.
Spending on buildings and structures dropped by 3.8%, and plant and machinery saw a 0.5% decline. Investors are now looking to Australian Retail Sales data, due on Friday, for further guidance.
Therefore, the stronger-than-expected Australian CPI data reduced rate cut expectations, supporting the AUD.
However, the drop in private capital spending could weigh on the currency. Overall, the AUD/USD pair may see mixed signals with inflation supporting the Aussie and spending data dampening sentiment.
Impact of US Economic Data and Fed Signals on the AUD/USD Pair
On the US front, the Federal Reserve (Fed) is signaling that lower interest rates might be on the way, putting pressure on the US dollar (USD). Fed Chair Jerome Powell mentioned at Jackson Hole that it’s time for policy adjustments, influenced partly by weakness in the job market.
The upcoming US Nonfarm Payrolls report for August will be crucial, as it could provide insights into the labor market's health and impact the Fed's decision on interest rates.
The upcoming data is crucial for the AUD/USD pair. If the jobs report reveals further weakness or if GDP growth disappoints, it could lead to a weaker USD.
Additionally, the core Personal Consumption Expenditures (PCE) Price Index will be released on Friday, and if it rises to 2.7% as expected, it might lead the Fed to keep interest rates higher for longer, potentially strengthening the USD.
Conversely, lower-than-expected inflation could weaken the USD, supporting the Australian dollar. The AUD/USD pair is likely to react to these developments, with USD weakness providing potential support to the Aussie.
AUD/USD - Technical Analysis
The AUD/USD pair is currently trading at $0.68066, reflecting a 0.26% increase as the Australian Dollar gains traction against the U.S. Dollar.
The pair is showing a bullish bias, comfortably trading above the 50-day Exponential Moving Average (EMA) positioned at $0.6780. This moving average serves as a key support level, indicating that buyers have control in the short term.
The pivot point for the day is set at $0.6831, which also aligns with the first level of immediate resistance. A break above this resistance could open the door for further gains, with the next resistance targets at $0.6849 and $0.6869.
The Relative Strength Index (RSI) is currently at 60, suggesting a strong but not overextended momentum.
This indicates that there’s room for the AUD/USD pair to climb higher before reaching overbought conditions.
On the downside, immediate support is seen at $0.6773, just below the 50-day EMA. Should the pair drop below this level, additional support is found at $0.6752 and $0.6728. A break below these levels would likely shift the momentum to bearish, potentially inviting further declines.
For traders considering entering the market, an entry above $0.67955 looks favorable, with a take-profit target at $0.68312.
A stop-loss at $0.67732 is recommended to limit downside risk. Overall, while the short-term outlook remains bullish, traders should keep an eye on key resistance levels and the RSI for any signs of a reversal.
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AUD/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- Bullish Momentum: Trading above the 50-day EMA at $0.6780, indicating short-term strength.
- Resistance Levels: Immediate resistance at $0.6831, with further targets at $0.6849 and $0.6869.
- Support Levels: Critical support lies at $0.6773, with additional support at $0.6752 and $0.6728.
The AUD/USD pair is currently trading at $0.68066, reflecting a 0.26% increase as the Australian Dollar gains traction against the U.S. Dollar.
The pair is showing a bullish bias, comfortably trading above the 50-day Exponential Moving Average (EMA) positioned at $0.6780.
This moving average serves as a key support level, indicating that buyers have control in the short term.
The pivot point for the day is set at $0.6831, which also aligns with the first level of immediate resistance. A break above this resistance could open the door for further gains, with the next resistance targets at $0.6849 and $0.6869.
The Relative Strength Index (RSI) is currently at 60, suggesting a strong but not overextended momentum. This indicates that there’s room for the AUD/USD pair to climb higher before reaching overbought conditions.
On the downside, immediate support is seen at $0.6773, just below the 50-day EMA. Should the pair drop below this level, additional support is found at $0.6752 and $0.6728.
A break below these levels would likely shift the momentum to bearish, potentially inviting further declines.
For traders considering entering the market, an entry above $0.67955 looks favorable, with a take-profit target at $0.68312.
A stop-loss at $0.67732 is recommended to limit downside risk. Overall, while the short-term outlook remains bullish, traders should keep an eye on key resistance levels and the RSI for any signs of a reversal.
AUD/USD - Trade Ideas
Entry Price – Buy Above 0.67955
Take Profit – 0.68312
Stop Loss – 0.67732
Risk to Reward – 1: 1.6
Profit & Loss Per Standard Lot = +$357/ -$223
Profit & Loss Per Mini Lot = +$35/ -$22
AUD/USD Price Analysis – Aug 27, 2024
Daily Price Outlook
During the European trading session, the AUD/USD currency pair maintained a bullish stance and remained well bid around the 0.6782 level, reaching an intra-day high of 0.6792.
This upward momentum was supported by upbeat market sentiment, which bolstered riskier assets like the Australian dollar (AUD).
However, the market sentiment gained traction as the Federal Reserve (Fed) is expected to start cutting interest rates in September.
This optimism is reflected in the S&P 500 futures, which have shown solid gains during European trading hours.
On the other side, the upticks in the currency pair could be short-lived as investors await the release of Australia’s Consumer Price Index (CPI) data for July on Wednesday. However, the annual inflation rate is expected to slow to 3.4% from the previous 3.8%.
Thus, the drop in inflation could lead to speculation that the Reserve Bank of Australia (RBA) may not cut interest rates this year.
Expected CPI Slowdown Could Boost AUD/USD as RBA Rate Cuts Seem Unlikely
On the AUD front, the Australian dollar's rally has slowed as investors turn their attention to the upcoming Consumer Price Index (CPI) data for July, which is due out on Wednesday.
The focus is on how this data might influence the Reserve Bank of Australia's (RBA) future decisions.
On the data front, inflation is expected to have slowed to 3.4% annually, down from 3.8% previously.
If inflation does indeed decrease, it could lead to speculation that the RBA will hold off on cutting interest rates this year, which might support the Australian dollar.
The market is closely watching to see how this data will shape the RBA's next moves and impact the AUD's performance.
Therefore, the expected slowdown in inflation may support the AUD/USD pair by reducing the likelihood of RBA rate cuts. If the RBA maintains rates, the Australian dollar could strengthen, potentially driving the AUD/USD pair higher.
Impact of Fed's Mixed Signals and Strong US Data on AUD/USD Dynamics
Despite the bullish US Dollar, the AUD/USD pair is gaining momentum amid positive risk sentiment. However, the recent comments from Federal Reserve officials hint at possible upcoming interest rate cuts, which could lend support to the Australian dollar.
Fed Chair Jerome Powell has indicated potential policy adjustments, expressing confidence that inflation is nearing the Fed's 2% target.
Meanwhile, San Francisco Fed President Mary Daly suggested that the time might be right to consider rate cuts, and Richmond Fed President Thomas Barkin advocated for a "test and learn" approach. These mixed signals from the Fed could influence market dynamics and impact the USD.
On the data front, the US economy demonstrated strength as Durable Goods Orders surged 9.9% in July, the highest increase since May 2020 and significantly surpassing expectations.
Despite this robust economic data, markets have fully priced in a 25 basis points rate cut, with a 30% probability of a larger cut, down from 36.5% the previous week.
Therefore, the mixed signals from the Fed, coupled with strong US economic data, may support the AUD/USD pair.
Interest rate cut speculation could bolster the Australian dollar, while robust US data might limit USD gains, influencing AUD/USD dynamics.
AUD/USD - Technical Analysis
The AUD/USD pair is currently trading at $0.67752, up 0.18% on the day, signaling a modest bullish trend.
The pivot point to watch is $0.6761. If prices stay above this level, the pair could continue its upward momentum, with immediate resistance at $0.6796, followed by $0.6816 and $0.6837.
A break above these levels could further solidify the bullish trend, with the potential to test higher levels in the short term.
On the downside, immediate support is found at $0.6740, with additional support levels at $0.6717 and $0.6696, providing a cushion for any pullbacks.
The 50-day Exponential Moving Average (EMA), currently at $0.6752, is serving as a crucial support level. As long as the AUD/USD remains above this EMA, the outlook remains positive, with the trend likely to stay bullish.
The Relative Strength Index (RSI) is at 55, indicating that the market is leaning towards bullish territory but isn't overbought, leaving room for further upside.
In summary, the technical indicators suggest that buying interest will likely strengthen if the pair remains above the pivot point at $0.6761.
Traders should consider entering long positions above $0.67614, targeting $0.67957, with a stop loss set at $0.67432 to manage risk. However, a drop below $0.6740 could signal a potential shift towards a bearish trend.
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AUD/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- Buy Entry: Above $0.67614, targeting $0.67957.
- Immediate Resistance: $0.6796, with further targets at $0.6816 and $0.6837.
- RSI at 55: Indicates a slight bullish bias, with room for further gains.
The AUD/USD pair is currently trading at $0.67752, up 0.18% on the day, signaling a modest bullish trend.
The pivot point to watch is $0.6761. If prices stay above this level, the pair could continue its upward momentum, with immediate resistance at $0.6796, followed by $0.6816 and $0.6837.
A break above these levels could further solidify the bullish trend, with the potential to test higher levels in the short term.
On the downside, immediate support is found at $0.6740, with additional support levels at $0.6717 and $0.6696, providing a cushion for any pullbacks.
The 50-day Exponential Moving Average (EMA), currently at $0.6752, is serving as a crucial support level. As long as the AUD/USD remains above this EMA, the outlook remains positive, with the trend likely to stay bullish.
The Relative Strength Index (RSI) is at 55, indicating that the market is leaning towards bullish territory but isn't overbought, leaving room for further upside.
In summary, the technical indicators suggest that buying interest will likely strengthen if the pair remains above the pivot point at $0.6761.
Traders should consider entering long positions above $0.67614, targeting $0.67957, with a stop loss set at $0.67432 to manage risk. However, a drop below $0.6740 could signal a potential shift towards a bearish trend.
AUD/USD - Trade Ideas
Entry Price – Buy Above 0.67614
Take Profit – 0.67957
Stop Loss – 0.67432
Risk to Reward – 1: 1.8
Profit & Loss Per Standard Lot = +$343/ -$182
Profit & Loss Per Mini Lot = +$34/ -$18
AUD/USD Price Analysis – Aug 22, 2024
Daily Price Outlook
Despite the hawkish sentiment surrounding the RBA's rate trajectory, the AUD/USD currency pair failed to sustain its early-day upward momentum and turned bearish around the 0.6738 level, hitting an intra-day low of 0.6727.
This downward trend can be attributed to the mild renewed strength of the US dollar, which gained traction following a slight recovery in Treasury yields on Thursday.
On the positive side, Australia's Judo Bank Composite PMI increased to 51.4 in August, fueled by stronger service sector growth.
However, the downside of the AUD/USD pair could be limited due to the hawkish stance adopted by the Reserve Bank of Australia (RBA) regarding its policy outlook.
RBA's Hawkish Stance and Strong Services PMI Support AUD/USD Pair
On the AUD front, the downside of the AUD/USD pair may be limited due to the Reserve Bank of Australia's (RBA) hawkish stance. The RBA's August Meeting Minutes revealed that the cash rate is likely to remain unchanged for some time.
Earlier this month, the board considered raising rates but decided that holding steady would better manage risks.
RBA Governor Michele Bullock emphasized that the central bank is ready to raise rates again if necessary to combat inflation. This decision marks the sixth consecutive meeting where the RBA has kept rates at 4.35%.
On the data front, Australia's Judo Bank Composite PMI rose to 51.4 in August, up from 49.9 in July, indicating the fastest expansion in three months.
This improvement was driven by a stronger services sector, even though manufacturing continued to decline. Meanwhile, the Services PMI increased to 52.2 in August from 50.4 in July, showing the fastest growth in services output in three months.
However, the Manufacturing PMI slightly rose to 48.7 from 47.5, indicating a continued, though slower, contraction in the sector for the seventh month in a row.
Therefore, the news is likely to support the AUD/USD pair. The RBA's hawkish stance and steady rates, combined with strong service sector growth, provide a positive outlook for the Australian dollar, despite ongoing manufacturing sector weakness.
Impact of US Rate Cut Expectations and Fed Caution on AUD/USD Pair
On the US front, the US Dollar (USD) gained slightly due to a minor recovery in Treasury yields on Thursday. However, it faced some challenges as the FOMC Minutes for July indicated that most Federal Reserve officials are likely to cut the benchmark interest rate in September.
Traders are closely watching Fed Chair Jerome Powell's upcoming speech at Jackson Hole.
According to the CME FedWatch Tool, the likelihood of a 25 basis point rate cut in September is now about 65.5%, down from 71.0% a day earlier. Meanwhile, the chance of a 50 basis point cut has increased to 34.5% from 29.0%.
Furthermore, Federal Reserve Governor Michelle Bowman expressed caution on Tuesday about making policy changes too quickly, citing risks to inflation. She warned that reacting too strongly to single data points could harm the progress made.
Meanwhile, Minneapolis Fed President Neel Kashkari suggested that discussing potential rate cuts in September might be appropriate due to concerns about a weakening labor market.
Therefore, the news could lead to a stronger AUD/USD pair as the expectations of a Fed rate cut, combined with ongoing caution from Fed officials, may weaken the USD, while the prospect of lower interest rates supports the Australian dollar.
AUD/USD - Technical Analysis
The AUD/USD pair is showing signs of strength, currently trading at $0.67517. The pivot point at $0.6772 will be crucial in determining whether the pair can sustain its upward momentum. Immediate resistance is at $0.6754, with further hurdles at $0.6771 and $0.6792.
If the price breaks above these levels, the pair could see further gains. On the downside, immediate support is found at $0.6714, followed by $0.6684 and $0.6666.
The RSI is nearing overbought territory at 69, indicating that the bullish momentum may soon face some resistance.
However, the 50-day EMA at $0.6662 is supportive, suggesting that the underlying trend remains positive.
Conclusion: Consider buying above $0.67372, with a target of $0.67715 and a stop loss at $0.67143.
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AUD/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- Pivot Point: $0.6772 is a key level for further gains.
- Support Levels: $0.6714, $0.6684, and $0.6666.
- Resistance Levels: $0.6754, $0.6771, and $0.6792.
The AUD/USD pair is showing signs of strength, currently trading at $0.67517. The pivot point at $0.6772 will be crucial in determining whether the pair can sustain its upward momentum.
Immediate resistance is at $0.6754, with further hurdles at $0.6771 and $0.6792. If the price breaks above these levels, the pair could see further gains.
On the downside, immediate support is found at $0.6714, followed by $0.6684 and $0.6666. The RSI is nearing overbought territory at 69, indicating that the bullish momentum may soon face some resistance.
However, the 50-day EMA at $0.6662 is supportive, suggesting that the underlying trend remains positive.
Conclusion: Consider buying above $0.67372, with a target of $0.67715 and a stop loss at $0.67143.
AUD/USD - Trade Ideas
Entry Price – Buy Above 0.67372
Take Profit – 0.67715
Stop Loss – 0.67143
Risk to Reward – 1: 1.5
Profit & Loss Per Standard Lot = +$343/ -$229
Profit & Loss Per Mini Lot = +$34/ -$22
AUD/USD Price Analysis and Trade Forecast: Daily Trading Signal
Daily Price Outlook
- AUD/USD is trading near overbought territory with RSI at 74.
- Key pivot point at $0.6738 will determine the short-term trend.
- Support at $0.6704 is crucial for maintaining the bullish outlook.
The AUD/USD pair is currently trading at $0.67258, showing a modest decline of 0.18%. The pivot point at $0.6738 is crucial for determining the short-term direction.
Immediate resistance is located at $0.6754, with further resistance levels at $0.6771 and $0.6792. On the downside, support levels are found at $0.6704, $0.6684, and $0.6666.
The Relative Strength Index (RSI) stands at 74, indicating that the pair is in overbought territory, which could suggest a potential pullback or correction.
The 50-day Exponential Moving Average (EMA) is positioned at $0.6621, providing a strong support level that reinforces the ongoing bullish trend.
Given the current technical setup, if AUD/USD remains above the $0.6704 support level, the bullish outlook is likely to continue.
A break above the immediate resistance at $0.6754 could push the pair higher towards $0.6771 and beyond.
However, if the pair falls below $0.6704, it could trigger a deeper correction towards the next support levels.
Conclusion: The strategy here is to buy above $0.67037, targeting a profit at $0.67652 with a stop loss at $0.66693.
AUD/USD - Trade Ideas
Entry Price – Buy Above 0.67037
Take Profit – 0.67652
Stop Loss – 0.66693
Risk to Reward – 1: 1.7
Profit & Loss Per Standard Lot = +$615/ -$344
Profit & Loss Per Mini Lot = +$61/ -$34
AUD/USD Price Analysis – Aug 20, 2024
Daily Price Outlook
During the European trading session, the AUD/USD currency pair maintained a bullish stance and remained well bid around the 0.6732 level, reaching an intra-day high of 0.6739.
This upward momentum was driven by several factors, including hawkish sentiment surrounding the Reserve Bank of Australia (RBA).
Additionally, the US Dollar (USD) continues to face downward pressure following comments from Federal Reserve (Fed) officials, which have increased the likelihood of upcoming rate cuts by the US central bank.
Looking forward, traders are cautious ahead of the July FOMC meeting minutes on Wednesday and Fed Chair Jerome Powell’s speech at Jackson Hole on Friday.
Meanwhile, dovish Fed expectations and ongoing geopolitical risks could provide some support for the AUD/USD pair, potentially limiting further declines.
RBA’s Steady Rates and PBoC’s Unchanged LPRs Impact on AUD/USD
On the AUD front, the AUD/USD pair could see some appreciation following the Reserve Bank of Australia's (RBA) August meeting minutes.
These minutes revealed that the RBA considered raising interest rates but ultimately decided that keeping the cash rate steady would better balance the economic risks.
RBA members agreed that a rate cut is unlikely in the near future, suggesting that the cash rate could remain unchanged for an extended period.
This decision reflects the RBA's cautious approach to managing inflation and economic growth, which may provide some support for the Australian dollar against the US dollar.
On the other side, the People's Bank of China (PBoC) kept its one-year and five-year Loan Prime Rates (LPRs) unchanged in August at 3.35% and 3.85%.
Since China is a key trade partner for Australia, any shifts in the Chinese economy could affect Australian markets.
Therefore, RBA's decision to keep rates steady could boost the AUD/USD pair, supporting the Australian dollar. However, China's unchanged LPRs mean any economic changes in China might also impact the pair.
Impact of US Economic Data and Fed Signals on AUD/USD Pair
On the US front, the US Dollar (USD) is under pressure following comments from Federal Reserve (Fed) officials hinting at possible rate cuts.
Minneapolis Fed President Neel Kashkari suggested discussing rate cuts in September due to concerns about a weakening job market.
San Francisco Fed President Mary Daly advocated for a gradual approach to lowering borrowing costs. Chicago Fed President Austan Goolsbee warned against keeping restrictive policies too long.
On the data front, US Housing Starts fell by 6.8% to 1.238 million units in July after a slight increase in June.
However, the University of Michigan’s Consumer Sentiment Index rose to 67.8 in August, marking its first gain in five months. US Retail Sales surged 1.0% in July, a sharp rebound from June’s decline, and Initial Jobless Claims for early August were lower than expected at 227,000.
Meanwhile, the Consumer Price Index (CPI) rose 2.9% year-over-year in July, slightly below June's rate, while Core CPI increased 3.2%, matching forecasts.
The USD's weakness from potential Fed rate cuts and mixed economic data could support the AUD/USD pair. Strong retail sales and consumer sentiment may bolster the Australian dollar against the USD.
AUD/USD - Technical Analysis
The AUD/USD pair is currently trading at $0.67258, showing a modest decline of 0.18%. The pivot point at $0.6738 is crucial for determining the short-term direction.
Immediate resistance is located at $0.6754, with further resistance levels at $0.6771 and $0.6792. On the downside, support levels are found at $0.6704, $0.6684, and $0.6666.
The Relative Strength Index (RSI) stands at 74, indicating that the pair is in overbought territory, which could suggest a potential pullback or correction.
The 50-day Exponential Moving Average (EMA) is positioned at $0.6621, providing a strong support level that reinforces the ongoing bullish trend.
Given the current technical setup, if AUD/USD remains above the $0.6704 support level, the bullish outlook is likely to continue.
A break above the immediate resistance at $0.6754 could push the pair higher towards $0.6771 and beyond.
However, if the pair falls below $0.6704, it could trigger a deeper correction towards the next support levels.
Conclusion: The strategy here is to buy above $0.67037, targeting a profit at $0.67652 with a stop loss at $0.66693.
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