Basic overview
The USD continues to consolidate around the high levels except against commodity currencies where it has been gaining the upper hand. Last week's US inflation data was disappointing again although the data that feeds into the Core PCE overall was mixed as forecasters of the expected to increase 0.13% M / M.
Nevertheless, the Financial Results continue to climb and are now back around their post-US election highs. There is some understandable uneasiness in the bond market with the hot US data and the Fed continuing to cut into an accelerating economy.
On the AUD side, the RBA we kept the cash rate unchanged at the last policy decision but eased further as we slowly move towards the first rate cut in 2025. The Australian labor market report recently it came out much better than expected which reduced the probability for the first cut in February to 64%. The first cut is full price for April.
AUDUSD Technical Analysis – Daily Time Chart
AUDUSD per day
On the daily chart, we can see that AUDUSD is challenging the 2024 levels around the 0.6340 level. The sellers are likely to continue piling around these levels to extend the drop to the 0.6267 level next. The customers, on the other hand, must break above the line of motion
to regain control and start aiming for the 0.65 handle next.
AUDUSD Technical Analysis – 4 hour timeframe
AUDUSD 4 hours
On the 4 hour chart, we can see that from a risk management perspective, the sellers will have a better risk to reward position around the main trend. On the other hand, the buyers are likely to step in around the 2024 lows to position for a pullback into the trend line and target a break above it.
AUDUSD Technical Analysis – 1 hour timeframe
AUDUSD 1 hour
On the 1 hour chart, we can see that we have a small protection zone around the 0.6380 level where the price has been rejected several times in the past days. It is likely that the sellers will continue that position against a position for low levels, while the buyers will look for a higher break to increase the bullish bets into the main trend line. The red lines define the average daily range for today.
Catalysts to come
Todaywe get US Retail Sales data. Tomorrow, we have the FOMC Policy Decision. On Thursday, we will get the latest US jobless claims numbers. On Friday, we finish the week with US PCE data.
