AUDUSD is still consolidating inside its range that’s been holding so far this year, as price is bouncing between support at .6575 and resistance at .6615. Price is down to the bottom of the range and might be gearing up for more losses.

A move below the range support could set off a drop that’s the same height as the rectangle. On the other hand, a bounce could take AUDUSD back up to the range resistance again.

Technical indicators are looking mixed. The 100 SMA is above the 200 SMA to suggest that support is more likely to hold than to break, but the pair is trading below both moving averages so these could hold as dynamic resistance around .6590.

Stochastic is bottoming out near the oversold region to suggest weakening bearish pressure, so moving higher could confirm that bullish vibes are picking up. RSI is also turning higher without reaching the oversold area, so buyers might be eager to defend support.

Australia’s economic reports turned out mostly weaker than expected this week, as both retail sales and CPI data fell short of estimates. This sets the stage for a potentially dovish RBA decision next week, underscoring their shift to a more cautious stance in their December meeting.

However, the upcoming US NFP release might prove to be a bigger catalyst for AUDUSD price action, as this could also make or break the earlier reaction to the Fed decision.

Recall that the FOMC dampened hopes for a March rate cut, triggering a sharp rally for the dollar and drop in risk assets. If the NFP disappoints, however, this move might be reversed and spur a run-up for higher-yielding currencies like AUD.

Still, an upside jobs surprise could confirm that the Fed isn’t likely to ease anytime soon, which might bring risk-off flows back in the mix.