AUD/USD Price Analysis: Teasing a rising wedge breakdown amid US-China woes


  • AUD/USD remains sold-off into dovish RBA tone and US-China woes over Taiwan.
  • RBA hikes key rates by 50 bps but says it's not on a pre-set tightening path.
  • A potential rising channel breakdown on the 1D targets 21 DMA at 0.6873.

AUD/USD is holding the lower ground above 0.6900, losing nearly 1.50% on the day, as the AUD bulls continue to face a double-whammy this Tuesday.

Risk-aversion remains at full steam, as markets stay anxious ahead of the expected visit of US House of Representatives Speak Nancy Pelosi to Taiwan around 1430 GMT. The US remains unintimidated by the Chinese threats but Beijing and Taipei have stepped up their military responses in a show of strength, as Pelosi visits the self-ruled island claimed by the dragon nation.

Another reason for the aussie sell-off is the dovish signal from the Reserve Bank of Australia (RBA) during its monetary policy meeting. The RBA raised the key rate by 50 bps to 1.85% this month, as widely expected. However, the central bank noted that they are not on a pre-set tightening path, in a way abandoning the forward guidance, which triggered a fresh downfall in the aussie dollar.

All eyes now remain on Pelosi’s arrival to Taipei, which could see a fresh risk-aversion wave spelling out in the early American session. Meanwhile, the pair also remains exposed to downside risks, given that it is on track to confirm a rising wedge breakdown on the daily chart.

AUD/USD has breached the horizontal 50-Daily Moving Average (DMA) support at 0.6966, which has opened up the additional downside.

A daily closing below the rising trendline support at 0.6952 will validate the bearish channel.

The next relevant downside cap is pegged at 0.6873, which is the horizontal 21 DMA.

The 14-day Relative Strength Index (RSI) is attacking the midline, suggesting that there is more room southwards.

AUD/USD: Daily chart

Recapturing the 50 DMA is critical to initiating any meaningful recovery towards 0.7000.

The intraday high of 0.7034 will emerge as a tough nut to crack for AUD bulls.

AUD/USD: Additional levels to consider

AUD/USD

Overview
Today last price 0.6920
Today Daily Change -0.0099
Today Daily Change % -1.41
Today daily open 0.7019
 
Trends
Daily SMA20 0.6871
Daily SMA50 0.6969
Daily SMA100 0.7121
Daily SMA200 0.7173
 
Levels
Previous Daily High 0.7048
Previous Daily Low 0.6968
Previous Weekly High 0.7033
Previous Weekly Low 0.6879
Previous Monthly High 0.7033
Previous Monthly Low 0.668
Daily Fibonacci 38.2% 0.7017
Daily Fibonacci 61.8% 0.6999
Daily Pivot Point S1 0.6975
Daily Pivot Point S2 0.6932
Daily Pivot Point S3 0.6895
Daily Pivot Point R1 0.7055
Daily Pivot Point R2 0.7092
Daily Pivot Point R3 0.7135

 

 

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended content

Editors’ Picks

EUR/USD stays weak near 1.0400 as trading conditions thin out

EUR/USD stays weak near 1.0400 as trading conditions thin out

EUR/USD trades with mild losses near 1.0400 on Tuesday. The expectation that the US Federal Reserve will deliver fewer rate cuts in 2025 provides some support for the US Dollar. Trading volumes are likely to remain low heading into the Christmas break.

EUR/USD News
GBP/USD consolidates below 1.2550 on stronger US Dollar

GBP/USD consolidates below 1.2550 on stronger US Dollar

GBP/USD consolidates in a range below 1.2550 on Tuesday, within striking distance of its lowest level since May touched last week. The sustained US Dollar rebound and the technical setup suggest that the pair remains exposed to downside risks. 

GBP/USD News
Gold holds above $2,600, bulls non-committed on hawkish Fed outlook

Gold holds above $2,600, bulls non-committed on hawkish Fed outlook

Gold trades in a narrow channel above $2,600 on Tuesday, albeit lacking strong follow-through buying. Geopolitical tensions and trade war fears lend support to the safe-haven XAU/USD, while the Fed’s hawkish shift acts as a tailwind for the USD and caps the precious metal.

Gold News
IRS says crypto staking should be taxed in response to lawsuit

IRS says crypto staking should be taxed in response to lawsuit

In a filing on Monday, the US International Revenue Service stated that the rewards gotten from staking cryptocurrencies should be taxed, responding to a lawsuit from couple Joshua and Jessica Jarrett.

Read more
2025 outlook: What is next for developed economies and currencies?

2025 outlook: What is next for developed economies and currencies?

As the door closes in 2024, and while the year feels like it has passed in the blink of an eye, a lot has happened. If I had to summarise it all in four words, it would be: ‘a year of surprises’.

Read more
Best Forex Brokers with Low Spreads

Best Forex Brokers with Low Spreads

VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.

Read More

Forex MAJORS

Cryptocurrencies

Signatures