AUD/USD Forecast: Sentiment leads the way

Valeria Bednarik FXStreet

AUD/USD Current Price: 0.6931

NAB’s Business Confidence is expected to have contracted in the last quarter of 2022.
Wall Street edged lower while Treasury yields managed to hold ground.
AUD/USD pressures daily lows, in line with a continued decline on Thursday.

The AUD/USD pair peaked on Wednesday at 0.6995, a fresh weekly high, but finished the day in the red at around 0.6930. The US Dollar appreciated in the final trading session of the day, as Wall Street could not extend its Tuesday rally, but on the contrary, it edged lower.

US stocks trimmed a good bunch of their Federal Reserve Chair Powell-inspired gains and while government bond yields remained stable. The 10-year Treasury note currently yields 3.65%, while the 2-year note offers 4.46%.

Australia published the AIG Industry Index for December, a new compilation of business activity. It declined 11.6 points as manufacturing activity shrank in the month. On a positive note, the construction sub-component rose 11.4 bps. On Tuesday, the country will release Q4 NAB’s Business Confidence, foreseen at 5, down from 9 in Q3.

AUD/USD short-term technical outlook

The AUD/USD pair daily chart shows that it pressures its intraday low, usually a sign of another leg lower coming in Asia. The daily chart shows that the pair is currently developing below a flat 20 SMA, currently at around 0.7010, while technical indicators turned flat at around their midlines.

The pair is still neutral in the 4-hour chart, trading a handful of pips above a mildly bullish 200 SMA while hovering around a bearish 20 SMA. The Momentum indicator lacks directional strength above its midline, while the RSI indicator turned flat at around 42, skewing the risk to the downside. A break through 0.6900 should confirm a downward continuation on Thursday.

Support levels: 0.6900 0.6850 0.6805

Resistance levels: 0.6965 0.7000 0.7045

View Live Chart for the AUD/USD

Premium

You have reached your limit of 3 free articles for this month.

Start your subscription and get access to all our original articles.

Subscribe to Premium Sign In

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

EUR/USD hits two-day highs near 1.1820

EUR/USD picks up pace and reaches two-day tops around 1.1820 at the end of the week. The pair’s move higher comes on the back of renewed weakness in the US Dollar amid growing talk that the Fed could deliver an interest rate cut as early as March. On the docket, the flash US Consumer Sentiment improves to 57.3 in February.

GBP/USD reclaims 1.3600 and above

GBP/USD reverses two straight days of losses, surpassing the key 1.3600 yardstick on Friday. Cable’s rebound comes as the Greenback slips away from two-week highs in response to some profit-taking mood and speculation of Fed rate cuts. In addition, hawkish comments from the BoE’s Pill are also collaborating with the quid’s improvement.

Gold climbs further, focus is back to 45,000

Gold regains upside traction and surpasses the $4,900 mark per troy ounce at the end of the week, shifting its attention to the critical $5,000 region. The move reflects a shift in risk sentiment, driving flows back towards traditional safe haven assets and supporting the yellow metal.

Crypto Today: Bitcoin, Ethereum, XRP rebound amid risk-off, $2.6 billion liquidation wave

Bitcoin edges up above $65,000 at the time of writing on Friday, as dust from the recent macro-triggered sell-off settles. The leading altcoin, Ethereum, hovers above $1,900, but resistance at $2,000 caps the upside. Meanwhile, Ripple has recorded the largest intraday jump among the three assets, up over 10% to $1.35.

Three scenarios for Japanese Yen ahead of snap election

The latest polls point to a dominant win for the ruling bloc at the upcoming Japanese snap election. The larger Sanae Takaichi’s mandate, the more investors fear faster implementation of tax cuts and spending plans.

XRP rally extends as modest ETF inflows support recovery

Ripple is accelerating its recovery, trading above $1.36 at the time of writing on Friday, as investors adjust their positions following a turbulent week in the broader crypto market. The remittance token is up over 21% from its intraday low of $1.12.