The AUD/USD currency pair bounced off closer to 4-week lows after finding support on the bullish trendline. It is now facing resistance around the 0.6800 level. The currency pair has been on a downward movement since the start of the month but now appears to have found a comfortable trading range following Friday’s rebound.
The pair is several pips off the 100-hour and the 200-hour SMA lines and is pegged in the median point of the RSI indicator in the 60-min chart.
AUD/USD Fundamentals Overview
From a fundamental perspective, the AUD/USD currency pair is trading at the back of a busy period in the US markets. After what now appears to be a momentary ceasefire in the trade war with China, economic data took center-stage.
On Tuesday, the US NFIB Business Optimism Index for October missed the expectation of 103.5 with 102.4 while the Redbook Index edged lower on both (MoM) and (YoY) basis from the previous period. And on Wednesday, the preliminary seasonally-adjusted US Core CPI missed expectations of 265.106 with 265.011 while the general CPI change ex-food and energy missed the expectation of 2.4% with 2.3%. The Basic CPI beat the projected (YoY) change of 1.7% with 1.8%.
In Australia, Part-time employment change for October came in at -7.5k versus -12.5k in the previous period while Full-time employment was -10.3k versus 24.9k from September. On the other hand, the seasonally-adjusted unemployment rate came in line with expectations at 5.3% up from 5.2% in the previous month.
AUD/USD Technical Analysis (the 60-min Chart)
Technically, the AUD/USD currency pair appears to be trading in a descending movement in the 60-min chart, which depicts a short-term bearish pressure. The currency pair has recently bounced off the trendline support at around 0.6770 but it is finding it difficult to surge above 0.6800 key level.
Therefore, the bulls will be targeting short-term profits at around 0.6814 or higher at 0.6830 while the bears will look to pounce for profits at around 0.6791 or lower at 0.6777.
AUD/USD Technical Analysis (the Daily Chart)
In the daily chart, the AUD/USD currency pair appears to be trading under intense bearish pressure. However, over the last three months, the pair appears to have started to form a reversal pattern after bottoming at 0.6680.
Therefore, with the RSI indicator in the daily chart pointing towards a bearish momentum supported by the 100-day and the 200-day SMA lines the bears will look to target long-term profits at around 0.6749 and 0.6680 while the bulls will hope for a continuation of the recovery towards 0.6874 and 0.6935.