AUD/USD Forecast: Consolidating with downside risks
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UPGRADEAUD/USD Current Price: 0.6377
- The AUD/USD continues to move between 0.6355 and 0.6400.
- The consolidation phase seems likely to continue during the Asian session.
- As long as the US Dollar remains firm and market caution persists, risks are tilted to the downside.
- The AUD/USD remains around 0.6375, in a consolidation phase, holding onto recent losses and unable to recover 0.6400. Risks remain tilted to the downside amid a stronger US Dollar and cautious markets.
Data released on Thursday showed a 2% decline in Australian exports in July and a 3% increase in imports. The trade balance surplus was smaller than forecasted. Furthermore, Chinese trade data for August came in near expectations, showing signs of stabilization after months of declines. Exports dropped by 8.8% from a year ago, less than the expected decline of 9.5%, while imports dropped by 7.3%, less than the market consensus of a 9% decrease.
The Chinese numbers helped market sentiment but did not trigger a significant reaction in the Australian Dollar. Later in the day, outgoing Reserve Bank of Australia (RBA) Governor Philip Lowe reiterated that more tightening may be needed if inflation becomes stubborn. His words had no impact. Deputy Governor Michele Bullock will replace him on September 18, beginning a 7-year term.
The US Dollar Index hit fresh month highs above 105.00, boosted by the Jobless Claims report that came in above expectations. Later, as US Treasury yields turned decisively to the downside, the DXY pulled back, favoring the consolidation of AUD/USD. Risk sentiment and dollar dynamics remain the key drivers.
AUD/USD short-term technical outlook
The AUD/USD approached the 0.6400 level but was unable to break higher. It is currently experiencing a sideways movement, with risks leaning towards the downside. To alleviate bearish pressure, the Australian Dollar needs to achieve a daily close above 0.6400. If this level is surpassed, the focus will then shift towards the 20-day Simple Moving Average (SMA) located at 0.6440.
On the 4-hour chart, not much has happened over the last 50 hours. The pair is moving in a range with resistance around 0.6400 and support above 0.6355. Price is approaching the 20-period SMA, and technical indicators like Momentum are starting to show signs of relief for the Aussie. However, the overall bias on the chart is still to the downside, and a break below 0.6350 could trigger an acceleration targeting 0.6330 and then 0.6300.
Support levels: 0.6350 0.6330 0.6300
Resistance levels: 0.64000 0.6440 0.6460
AUD/USD Current Price: 0.6377
- The AUD/USD continues to move between 0.6355 and 0.6400.
- The consolidation phase seems likely to continue during the Asian session.
- As long as the US Dollar remains firm and market caution persists, risks are tilted to the downside.
- The AUD/USD remains around 0.6375, in a consolidation phase, holding onto recent losses and unable to recover 0.6400. Risks remain tilted to the downside amid a stronger US Dollar and cautious markets.
Data released on Thursday showed a 2% decline in Australian exports in July and a 3% increase in imports. The trade balance surplus was smaller than forecasted. Furthermore, Chinese trade data for August came in near expectations, showing signs of stabilization after months of declines. Exports dropped by 8.8% from a year ago, less than the expected decline of 9.5%, while imports dropped by 7.3%, less than the market consensus of a 9% decrease.
The Chinese numbers helped market sentiment but did not trigger a significant reaction in the Australian Dollar. Later in the day, outgoing Reserve Bank of Australia (RBA) Governor Philip Lowe reiterated that more tightening may be needed if inflation becomes stubborn. His words had no impact. Deputy Governor Michele Bullock will replace him on September 18, beginning a 7-year term.
The US Dollar Index hit fresh month highs above 105.00, boosted by the Jobless Claims report that came in above expectations. Later, as US Treasury yields turned decisively to the downside, the DXY pulled back, favoring the consolidation of AUD/USD. Risk sentiment and dollar dynamics remain the key drivers.
AUD/USD short-term technical outlook
The AUD/USD approached the 0.6400 level but was unable to break higher. It is currently experiencing a sideways movement, with risks leaning towards the downside. To alleviate bearish pressure, the Australian Dollar needs to achieve a daily close above 0.6400. If this level is surpassed, the focus will then shift towards the 20-day Simple Moving Average (SMA) located at 0.6440.
On the 4-hour chart, not much has happened over the last 50 hours. The pair is moving in a range with resistance around 0.6400 and support above 0.6355. Price is approaching the 20-period SMA, and technical indicators like Momentum are starting to show signs of relief for the Aussie. However, the overall bias on the chart is still to the downside, and a break below 0.6350 could trigger an acceleration targeting 0.6330 and then 0.6300.
Support levels: 0.6350 0.6330 0.6300
Resistance levels: 0.64000 0.6440 0.6460
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