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Recent economic indicators have sparked speculation on whether the US will avoid an economic recession, potentially impacting investor bets on a June Fed rate cut. The US Jobs Report revealed higher wages and increased consumer spending, pointing towards upward trends in consumer spending that could drive demand-driven inflation.
As experts point towards a potential delay in interest rate cuts by the Fed due to a tightening US labor market and higher consumer prices, it’s essential for investors to keep an eye on the upcoming US CPI Report and FOMC member discussions. The views on the timing of interest rate cuts could have a significant impact on market movements.
In the short term, the AUD/USD trends are likely to be influenced by the US CPI Report and Fed decisions. Higher-than-expected consumer prices could alter investor expectations for a June Fed rate cut, potentially strengthening the US dollar. Keeping an eye on FOMC member statements and market reactions will be crucial for informed trading decisions.
Analyzing the AUD/USD Price Action, the currency pair has been holding above the 50-day and 200-day EMAs, indicating a bullish trend. A break above the $0.66500 handle could lead to a test of the $0.67003 resistance level, while a drop below the $0.66 handle could signal a potential decline towards the 200-day EMA and $0.65760 support level.
Considering the economic indicators from China, the US CPI Report, and ongoing Fed discussions, it’s important to stay informed and make data-driven decisions. With the AUD/USD showing a 14-period Daily RSI reading of 61.36, there may be room for further upside towards the $0.67003 resistance level before potentially entering overbought territory.
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