AUDUSD Technical Analysis

USD

• The Fed left interest rates unchanged as
  expected at the last meeting and dropped the tightening bias in the statement.
• The US PCE came
  in line with expectations.
• The NFP report beat
  expectations on the headline number, but the unemployment rate and the average
  hourly earnings missed notably.
• The latest US ISM
  Manufacturing PMI missed expectations by a big margin
  remaining in contraction with the US ISM Services
  PMI
  following suit but holding on in expansion.
• The US Consumer
  Confidence missed expectations across the board.
• The market expects the first rate cut in June.

AUD

• The
  RBA left interest rates unchanged as expected with the central bank
  maintaining the usual tightening bias and data dependent language.
• The
  last Monthly CPI report missed expectations across
  the board which was a welcome development for the RBA.
• The
  latest labour market report missed expectations by a big
  margin.
• The
  wage price index surprised to the upside as wage
  growth in Australia remains strong.
• The
  latest Australian PMIs showed the Manufacturing PMI falling
  back into contraction while the Services PMI jumped back into expansion.
• The
  market expects the first rate cut in August.

AUDUSD Technical Analysis –
Daily Timeframe

On the daily chart, we can see that AUDUSD eventually
pulled back from overstretched levels as the price got too far from the blue 8 moving average. In such
instances, we can generally see a pullback into the moving average or some
consolidation before the next move. In this case, we can expect the buyers to
step in around the moving average to position for a rally into new highs.

AUDUSD Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that we have a support zone
around the 0.6590 level where we can find the confluence of the
previous swing high level, the 38.2% Fibonacci retracement level
and the daily 8 moving average. This is where the buyers will likely step in
with a defined risk below the zone to position for new highs. The sellers, on
the other hand, will want to see the price breaking lower to invalidate the
bullish setup and position for a drop into the 0.6520 support.

AUDUSD Technical Analysis –
1 hour Timeframe

On the 1 hour chart, we can see more
closely the recent price action with the market now awaiting the US CPI
release. The data will likely set the trend for the next few weeks, so watch
carefully the market’s reaction at the key levels.

Upcoming Events

Today we have the main event of the week, that is
the US CPI report. On Thursday we get the US PPI, the US Retail Sales and the
US Jobless Claims figures. On Friday, we conclude the week with the University
of Michigan Consumer Sentiment survey.

This article was written by FL Contributors at www.forexlive.com.