AUD/USD is finding support from a major area of interest!
Will this lead to the pair extending a month-long uptrend?
We’re taking a closer look at the 4-hour time frame for clues!
AUD/USD: 4-hour
AUD/USD 4-hour Forex Chart Chart by TradingView
The second half of May has NOT been a good month for AUD/USD so far, as it fell from the .6700 psychological handle to trade closer to the .6600 levels after Fed officials piled on their “higher for longer” monetary policy biases.
The tides may change for the U.S. dollar this week as traders focus on the U.S. core PCE price index. If the official CPI reports are clues, then we may see that consumer price increases have slowed down in April.
Remember that directional biases and volatility conditions in market price are typically driven by fundamentals. If you haven’t yet done your fundie homework on the U.S. and Australian dollars, then it’s time to check out the economic calendar and stay updated on daily fundamental news!Focus on potentially soft U.S. inflation data and expectations of strong Australian retail sales data may bump AUD/USD back to its month-long uptrend.
AUD/USD, which found support from the .6600 psychological near its trend line and 100 SMA support, may see enough demand to revisit the .6700 previous resistance.
But if the U.S. core PCE price index comes in hotter than expected, or if this week’s round of Fed speak further push back interest rate cut bets, then USD could extend its gains against AUD and AUD/USD may break below its trend line.
Not feeling confident in taking a directional bias yet? Read this week’s potential catalysts so you’ll know more about what might move the major FX currencies!