AUDUSD Technical Analysis | Forexlive

USD

The Fed left interest rates unchanged as
expected at the last meeting 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 US Core PCE last
week came in line with forecasts with the disinflationary progress continuing
steady.
The labour market continues to show weakness as Continuing
Claims are now rising at a fast pace with the last NFP report
missing across the board. This week’s Job Openings and ADP came
below forecasts. although the Jobless Claims were
better than expected.
The ISM Manufacturing
PMI
last week missed expectations falling further into contraction, while the ISM Services PMI beat
forecasts holding on in expansion.
The hawkish Fed members recently shifted
their stance to a more neutral position.
The market expects the Fed to start cutting rates
as soon as Q1 2024.

AUD

The
RBA left interest rates unchanged as expected with the central bank
maintaining the usual data dependent language.
The
recent Monthly CPI report missed expectations across
the board which is a welcome development for the RBA.
The
RBA Governor Bullock has been leaning on a more hawkish side recently, although
she remains optimistic on the future outlook.
The
labour market continues to weaken as seen also
recently with the bulk of jobs added being part-time.
The
wage price index surprised to the upside as wage
growth in Australia remains strong.
The
recent Australian PMIs fell further into contraction for
both the Manufacturing and Services sectors.
The
market expects the RBA to start cutting rates in Q4 2024.

AUDUSD Technical Analysis –
Daily Timeframe

AUDUSD Daily

On the daily chart, we can see that AUDUSD sold off
from the trendline into the
key support zone
around the 0.65 handle where the price bounced from yesterday. Things might
start to get noisy here as the pair gets compressed between the key trendline
and the support zone. A breakout on either side though, should offer a clear
trading opportunity as on the upside we should rally into the 0.6780 level
while on the downside we will likely fall back into the 0.63 handle.

AUDUSD Technical Analysis –
4 hour Timeframe

AUDUSD 4 hour

On the 4 hour chart, we can see that the price has
been diverging with the
MACD into the
key trendline. This is generally a sign of weakening momentum often followed by
pullbacks or reversals. In this case, we got the pullback into the key support
zone and the bounce afterwards. The sellers should keep leaning on the
trendline to position for a break below the support zone, while the buyers will
likely continue to pile in around the support to position for a break above the
trendline.

AUDUSD Technical Analysis –
1 hour Timeframe

AUDUSD 1 hour

On the 1 hour chart, we can see that the
latest leg lower diverged with the MACD right into the key support. This was
another bullish confluence for the buyers to step in around the support zone to
position for a rally into the trendline. Right now, we have a support zone
around the 0.6593 level where we can find also the red 21 moving average for confluence. This
is where the buyers might lean onto to increase the bullish bets into the
trendline. The sellers, on the other hand, will want to see the price breaking
lower to pile in and target a drop back into the support at 0.65.