USD

  • The Fed left interest rates unchanged as expected with basically no change to the statement. The Dot Plot still showed three rate cuts for 2024 and the economic projections were upgraded with growth and inflation higher and the unemployment rate lower.
  • Fed Chair Powell maintained a neutral stance as he said that it was premature to react to the recent inflation data given possible bumps on the way to their 2% target.
  • The US CPI and the US PPI beat expectations for the second consecutive month.
  • The US Jobless Claims beat expectations across the board.
  • The latest US Manufacturing PMI beat expectations while the Services PMI missed slightly. Both the measures remain in expansion though.
  • The market expects the first rate cut in June.

AUD

  • The RBA left interest rates unchanged as expected and finally dropped the tightening bias.
  • The last Monthly CPI report missed expectations across the board which was a welcome development for the RBA.
  • The latest labour market report missed expectations by a big margin.
  • The wage price index surprised to the upside as wage growth in Australia remains strong.
  • The latest Australian PMIs showed the Manufacturing PMI falling further into contraction while the Services PMI continue to increase and remain in expansion.
  • The market expects the first rate cut in August.

AUDUSD Technical Analysis – Daily Timeframe

AUDUSD Technical Analysis
AUDUSD Daily

On the daily chart, we can see that AUDUSD bounced on the key support zone around the 0.65 handle and pulled back into the moving averages. This is where we can expect the sellers to step in with a defined risk above the moving averages to position for a break below the key support zone and target the 0.6443 low. The buyers, on the other hand, will want to see the price breaking higher to increase the bullish bets into the 0.6623 resistance.

AUDUSD Technical Analysis – 4 hour Timeframe

AUDUSD Technical Analysis
AUDUSD 4 hour

On the 4 hour chart, we can see that the price got rejected recently from the red 21 moving average where we had also the 38.2% Fibonacci retracement level for confluence. This is where the sellers are stepping in to position for a drop into new lows. The buyers, on the other hand, will need the price to break above the Fibonacci level to start targeting new highs.

AUDUSD Technical Analysis – 1 hour Timeframe

AUDUSD Technical Analysis
AUDUSD 1 hour

On the 1 hour chart, we can see that we have a counter-trendline defining the current short-term uptrend. This is where the buyers keep leaning onto to position for new highs with a better risk to reward setup. The sellers will want to see the price breaking below the trendline to invalidate the bullish setup and increase the bearish bets into new lows.

Upcoming Events

Today we have the US Consumer Confidence report. Tomorrow, we have the Australian Monthly CPI data and later in the day Fed’s Waller speaking. On Thursday, we get the latest US Jobless Claims figures, while on Friday we conclude with the US PCE and Fed Chair Powell.