Fundamental
Overview
We continue to see a
pullback in the US Dollar as the market kind of reached the peak in the
repricing of interest rates expectations and it will need stronger reasons to
price out the remaining rate cuts for 2025.
This was signalled by the
lack of US Dollar strength after lots of strong US data with the market’s
pricing remaining largely unchanged around three rate cuts by the end of 2025.
We might see the greenback remaining on the backfoot at least until the US CPI
due in two weeks.
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
On the daily chart, we can
see that AUDUSD is stuck in a range between the 0.6440 support and the 0.6540 resistance. The market
participants will likely keep on playing the range until we get a breakout on
either side.
AUDUSD Technical
Analysis – 4 hour Timeframe
On the 4 hour chart, we can
see that we have a very strong resistance zone around the 0.6540 level where we
can find the confluence of the major trendline and the 38.2% Fibonacci retracement level.
That’s where we can expect
the sellers to step in with a defined risk above the resistance to position for
the continuation of the downtrend. The buyers, on the other hand, will want to
see the price breaking higher to invalidate the bearish setup and position for
a rally into the next resistance at 0.6687.
AUDUSD Technical
Analysis – 1 hour Timeframe
On the 1 hour chart, we can
see that we have a minor upward trendline defining the current pullback into
the resistance. The buyers will likely lean on it to keep pushing higher, while
the sellers will look for a break lower to target new lows. The red lines
define the average daily range for today.
This article was written by Giuseppe Dellamotta at www.forexlive.com.
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