Welcome to Extreme Investor Network, where we provide unique insights and analysis on the stock market, trading, and everything related to Wall Street. Today, we are focusing on the AUD/USD pair and the factors influencing its price movements.
An RBA rate hike could narrow interest rate differentials between Australia and the US, potentially pushing the AUD/USD toward $0.70. However, the RBA faces challenges in getting inflation lower, as highlighted by IFM Chief Economist Alex Joiner. The need for a greater response from services sectors could impact the RBA’s decision-making process.
Looking at the US Economic Calendar, investors should pay attention to FOMC member commentary for insights on the economy, inflation, the labor market, and the Fed rate path. While jobless claims data showed a drop in initial claims, continuing jobless claims increased, adding to the mixed signals in the US labor market.
Expert views from Wall Street Journal Chief Economics Correspondent Nick Timiraos and FOMC Member Thomas Barkin provide additional perspectives on the US labor market and its potential impact on the Fed’s decisions.
In the short term, AUD/USD trends will be influenced by inflation numbers from China and central bank commentary. Better-than-expected inflation numbers could signal stronger demand and support a move toward $0.67. Investors should stay informed with real-time data, news updates, and expert commentary to adjust their trading strategies accordingly.
Analyzing the AUD/USD price action on the daily chart, we see that the pair is below the 50-day and 200-day EMAs, indicating bearish signals. A breakout above these EMAs could lead to a move toward the top trend line and potentially challenge the $0.67003 resistance level. On the downside, a drop below the $0.65760 resistance level could signal a decline toward $0.65 and eventually the $0.64582 support level.
With a 14-period Daily RSI reading of 48.92, there is potential for further downside in the Aussie dollar before entering oversold territory. Keep an eye on inflation numbers from China and central bank commentary for any impact on the AUD/USD price movements.
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