AUDUSD Technical Analysis | Forexlive

US

The Fed left interest rates unchanged as
expected with basically no change to the statement.
Fed Chair Powell stressed
once again that they are proceeding carefully as the full effects of policy
tightening have yet to be felt.
The recent US Core PCE came
in line with expectations.
The labour market is
starting to show some weakness as Continuing Claims
yesterday showed another increase and the NFP data
last Friday missed across the board.
The US Consumer
Confidence fell for the third consecutive month
although the data beat expectations.
The US ISM
Manufacturing PMI last week missed expectations by a big
margin, followed later on Friday with a disappointing ISM Services PMI,
although the index remained in expansion.
The market doesn’t expect the Fed to hike anymore.

Australia

The
RBA raised the cash rate by 25 bps as expected as the central bank
judged that the move was warranted to be more assured that inflation would
return to target in a reasonable timeframe.
The
CPI report recently surprised to the upside
prompting the market to price in a higher chance of another rate hike from the
RBA in November, which is what we eventually got.
The
RBA Governor Bullock downplayed the beat in the CPI data
and made the market to pare back the rate hike bets.
The
labour market continues to weaken as seen also
recently with the miss in the employment change and the losses in full-time
employment.
The
Australian Manufacturing PMI fell further into contraction with
the Services PMI plummeting back into contraction as well.
The
market expects the RBA to hold rates steady at the next meeting.

AUDUSD Technical Analysis –
Daily Timeframe

AUDUSD Daily

On the daily chart, we can see that the AUDUSD pair
last week surged into the key resistance around
the 0.65 handle but erased all the gains this week. It looks like the US Dollar
is starting to be seen as the best out of a bad bunch as recessionary data
continues to accumulate. The Fedspeak recently has also been leaning on the
hawkish side as the Fed wants to keep another rate hike on the table.

AUDUSD Technical Analysis –
4 hour Timeframe

AUDUSD 4 hour

On the 4 hour chart, we can see the selloff from
the key 0.65 resistance zone found support around the 0.6390 level where we had
also the trendline for confluence. The
price yesterday broke decisively below it, invalidating the bullish setup. The
sellers should now be more in control and from a risk management perspective,
they are likely to lean on the downward trendline where there’s the confluence
with the previous support turned resistance, the red
21 moving average and the Fibonacci retracement level.

AUDUSD Technical Analysis –
1 hour Timeframe

AUDUSD 1 hour

On the 1 hour chart, we can see more
closely the bearish setup around the 0.6390 level. We can also notice that the
latest leg lower diverged with
the MACD which
is generally a sign of weakening momentum often followed by pullbacks or
reversals. In this case, it might be a confirmation for a pullback into the
resistance and then a continuation of the bearish trend. The buyers, on the
other hand, will want to see the price breaking above the resistance to
invalidate the bearish setup and position for a rally back to the highs.