AUD/USD analysis and issues
- How will the RBA react to the recent market repricing?
- Focus on Australian and US inflation data.
- AUD/USD death cross, bearish flags and customer sentiment suggest AUD weakness is coming.
Recommended by Warren Venketas
Get Your Free AUD Prediction
Australian dollar basic background
The Australian dollar heads into next week after a fairly calm week on price volatility against the US dollar. So far, the Reserve Bank of Australia has been working on the data at home and abroad after deciding to suspend interest rates at its last interest rate meeting. The latest RBA minutes show that the door remains open to further rate hikes if needed, and since then the RBA interest rate probability table below has been revised to include short-term Powered by financial markets. 25bps 2023 hikes – a big change from days ago when no such hikes were planned!
Trade smarter – sign up for the DailyFX newsletter
Receive timely and compelling market commentary from the DailyFX team
Subscribe to our newsletter
RBA interest rate probability
Source: Refinitiv
The coming week (see economic calendar below) is jam-packed with high-impact events, mostly biased towards the US. From Australia’s perspective, Q1 inflation is expected to fall in both his YoY and QoQ indicators, and if inflation falls, the rate probability chart above could return without further gains. there is.
While recent US data has been downplayed, US GDP and the Federal Reserve’s preferred inflation indicator (Core PCE) look set to rise again on the calendar this week. It will be interesting to see how these and others (durables and consumer sentiment) play into the recent hawkish comments by Fed speakers.
economic calendar
sauce: DailyFX Economic Calendar
Last week’s strong Chinese GDP helped boost commodity prices as demand forecasts were revised upwards, but has since weakened as fears of a global recession gained momentum. The Australian dollar is heavily impacted by commodity exports, so a fall in prices will naturally put pressure on the local currency.
technical analysis
AUD/USD daily chart
Graph created by Warren Venketas, IG
The daily AUD/USD price action has developed a bear flag type chart pattern in conjunction with the death cross (red) earlier in the week.These signs are ominous for the Australian dollar, but the pair 0.6700 psychological handle. Next week’s fundamental data could be a catalyst to validate/defeat bearish flags.
Main resistance levels:
Primary support levels:
- 0.6700
- bear flag support
- 0.6620
IG Client Sentiment Data: Bearish
IGCS is now available to retail traders length in AUD/USD, 73% The number of traders currently holding long positions. DailyFX usually takes an opposite view of the crowd sentiment, resulting in short-term downtrends.
Contact and follow Warrenon Twitter: @WVenketas
Daily FX We provide forex news and technical analysis on trends affecting the global currency markets.