Fundamental
Overview
The US Dollar continues to
consolidate despite the higher-than-expected inflation figures and a less
dovish Powell last week. The market’s pricing remained largely unchanged at
three rate cuts by the end of 2025.
This might be a signal that
the market is now fine with the current pricing, and we will need stronger
reasons to price out the remaining rate cuts. This could lead to some general
US Dollar weakness in the short term.
On the AUD side, the market
doesn’t expect the RBA to cut rates in December but sees two rate cuts in 2025.
The Australian economic data remains solid while inflation continues to fall
slowly keeping the RBA in a neutral stance.
AUDUSD
Technical Analysis – Daily Timeframe
AUDUSD Daily
On the daily chart, we can
see that AUDUSD is now testing the key swing low level at 0.6540. This is where
we can expect the sellers to step in with a defined risk above the level to
position for a drop into the 0.6365 level next. The buyers, on the other hand,
will want to see the price breaking higher to increase the bullish bets into
new highs.
AUDUSD Technical
Analysis – 4 hour Timeframe
AUDUSD 4 hour
On the 4 hour chart, we can
see that we have also the 38.2% Fibonacci
retracement level adding some confluence
to the swing low level. This should technically strengthen this resistance
zone. A break to the upside, will likely trigger a rally into the major trendline
and the 61.8% Fibonacci retracement level around the 0.66 handle.
AUDUSD Technical
Analysis – 1 hour Timeframe
AUDUSD 1 hour
On the 1 hour chart, we can
see that we have a minor support zone around the 0.6480 level. If we were to
get a pullback, we can expect the buyers to step in around the support to
position for a rally into the major trendline, while the sellers will look for
a break lower to target new lows. The red lines define the average daily range for today.
Upcoming
Catalysts
Tomorrow we get the latest US Jobless Claims figures, while on Friday we conclude
the week with the Australian and US PMIs.