Australian Dollar trades neutral on mixed Australian figures, eyes on Fed

AUD/USD wades through mixed trading as sellers regain momentum.
Focus is now on Wednesday’s US inflation figures and Fed dot plot.
Australia releases mixed NAB business survey figures.

On Tuesday, the AUD/USD pair experienced mixed trading, facing some bearish pressure and lingering around the 0.6605 area. This shift occurred as sellers re-entered the market after a minor rebound on Monday. The ongoing Federal Reserve (Fed) two-day meeting, due to conclude on Wednesday, and the US May inflation data release will be the key drivers this week.

On the Australian front, a mixed economic outlook with inflation stubbornly high might prompt the Reserve Bank of Australia (RBA) to delay cuts, which might limit losses for the Aussie.

Daily digest market movers: Aussie is under pressure as traders anticipate CPI and the Fed’s decision

On the US side, markets await the May Consumer Price Index (CPI) data due to be released on Wednesday.
Fed’s two-day meeting, which began on Tuesday and will end on Wednesday, has gripped the market’s attention. Any fresh clue on their interest rate forecast might trigger volatility in markets.
Guidance from an updated dot plot are anticipated as well.
NAB’s May business survey shows mixed results for Australia’s outlook as the business confidence dropped to a six-month low of -3 from 1 in April.
Business conditions dipped slightly to 6, just below the long-term average while the Employment sub-component showed improvement.
These indicators suggest the RBA should remain cautious about easing prematurely.

Technical analysis: AUD/USD maintains support despite retracement

Following recent declines, the Relative Strength Index (RSI) continues to be below 50, supporting the bearish mood, while the Moving Average Convergence Divergence (MACD) prints red bars, reflecting a growing selling pressure.

Nonetheless, the positive outlook remains the same as the pair remains above the 100 and 200-day SMA at approximately 0.6550, suggesting an overall positive trend.