US:

• The Fed hiked by 25 bps as
  expected and kept everything unchanged.
• Fed Chair Powell reaffirmed their data dependency
  and kept all the options on the table.
• The US economic data keeps on surprising to the
  upside, but inflation expectations and CPI readings continue to show
  disinflation with the last two Core CPI M/M figures
  coming in at 0.16%.
• The US PMIs missed
  expectations across the board last week, while the US Jobless Claims remained
  solid.
• Fed Chair Powell’s speech at the Jackson Hole Symposium was
  mostly in line with what he said previously but he stressed on the need to be
  careful going forward and that continued strength in the labour market may
  require further rate hikes.
• At the moment, the market doesn’t expect another
  hike from the Fed, but the next NFP and CPI data will be crucial to confirm or
  change this view.

Australia:

• The
  RBA kept its cash rate unchanged with a slight tweak to a line in
  the policy statement that suggests that they are leaning more on the dovish
  side.
• The
  RBA Minutes showed that the central bank indeed
  prefers to keep the cash rate steady.
• The
  data is supporting the RBA’s stance as the Australian jobs, wages and inflation data all missed expectations.
• The
  Australian PMIs also missed expectations remaining
  in contraction.
• The
  market expects the RBA to hold the cash rate steady in September.

AUDUSD Technical Analysis –
Daily Timeframe

On the daily chart, we can see that AUDUSD went
into a consolidation right beneath the key 0.6459 level. It looks like the pair
is bottoming out before a bigger correction to the upside, but at the moment
the sellers are still in control as the price will need to break decisively
above the 0.65 handle to switch the bias from bearish to bullish.

AUDUSD Technical Analysis –
4 hour Timeframe

On the 4 hour chart, we can see that we had a divergence with the
MACD falling
into the lows which this is generally a sign of weakening momentum often
followed by pullbacks or reversals. In this case, we got a breakout of the trendline, which
raises the chances in favour of a reversal, and the pair started to range
between the 0.6380 support and the
0.6459 resistance. The sellers are likely to pile in around the resistance with
a defined risk above the level to target a new lower low, while the buyers will
want to see a break to the upside to start targeting the 0.66 handle.

AUDUSD Technical Analysis –
1 hour Timeframe

On the 1 hour chart, we can see more
closely the range created just beneath the key 0.6459 level. These levels will
be key to watch as a breakout on either side should lead to a big move with the
0.66 handle as target on the upside and 0.6168 as target on the downside.

Upcoming Events

This week is an important one given that we will see
many key labour market data for the US, including the NFP, before the next FOMC
meeting. Today, we have the US Consumer Confidence and the US Job Openings
reports. Tomorrow, we have the Australian Monthly CPI, which shouldn’t change
the RBA’s stance unless we see a big upward surprise, and later in the day the
US ADP report. Moving on to Thursday, we will see the US Jobless Claims and the
US PCE data. Finally, we conclude the week with the US NFP and the ISM Manufacturing
PMI on Friday. Although the Fed keeps all the options on the table, it’s also
leaning more towards a pause in September, so we will need strong data to make
the market to expect a hike at the upcoming meeting.

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