With Fed members continuing to stress that more rate hikes are on the cards if the data remains strong, the market started to price in a hawkish scenario as data from the last FOMC meeting continued to surprise as growth led the US dollar. strong. Much will depend on the next NFP and CPI reports, but the July rally seems already baked in and only major setbacks can change this outcome.
AUDUSD Technical Analysis – Daily Time Frame
On the daily chart, we can see that since touching the 0.69 AUDUSD handle, it has continued to decline, almost erasing all the rally seen since the beginning of June. Both buyers and sellers have been faking the leaks, which shows how uncertain and difficult to trade the current market is. The target should now be the 0.6563 support, where buyers are likely to step in and target a rally towards the 0.6781 resistance, while sellers will want to see a break below to pile up even more aggressively and look forward to a new low.
AUDUSD Technical Analysis – 4 Hour Time Frame
On the 4-hour chart, we can see that since the breakout of the rising channel a moving averages
crossover, sellers just aggressively piled on each download. We have it down trend line and the red moving average of 21 acts as resistance and we are likely to see sellers re-enter here and target the next lower low at the 0.6563 support. Buyers will need to break to the upside to find some conviction and start positioning themselves on the upside towards the 0.6781 resistance.
AUDUSD Technical Analysis – 1 Hour Time Frame
On the 1-hour chart, we can see more clearly the resistance zone on the trend line, where the 38.2% is also Fibonacci retracement level and round number 0.6650. This zone will be key and the only two scenarios are:
- A breakout to the upside leading to a rise towards the 0.6781 resistance.
- Rejection leading to a new lower support low of 0.6563.
Todaywe have the US PCE report and higher than expected numbers will likely lead to US dollar strength while lower than expected data should weaken the dollar.