The AUD/USD currency pair on Friday pulled back off the current 4-month highs of about 0.6894 to trade at about 0.6834. The currency pair appears to be trading within a descending channel formation in the 60-min chart.

The pair still remains several levels above the 100-hour moving average line. However, Friday’s pullback pushed the currency pair closer to the oversold levels of the 14-hour RSI.

AUD/USD Fundamentals Overview

From a fundamental perspective, the AUD/USD currency pair is trading at the back of a relatively busy period in the US market. On Friday, the preliminary Michigan Consumer Sentiment Index for July outperformed the expectation of 65.5 with a reading of 72.6. The preliminary UoM 5-year consumer inflation expectation for July stood at 3.1% in line with estimates, up from 3% in the previous update.

On Thursday, the initial jobless claims for the week ending July 7 beat the forecasted claim count of 250k with a tally of 237k. The producer price index for June missed the expected (MoM) and (YoY) changes of 0.2% and 0.4%, respectively with a change of 0.1% and 0.1%. The PPI ex-food and energy also missed the expected (YoY) change of 2.6% with a change of 2.4%, while the (MoM) equivalent fell short of 0.2% with a change of 0.1%.

In Australia, the consumer inflation expectations for July outshone the forecasted rate of 5.1% with a rate of 5.2%. The Westpac consumer confidence for July delivered a rate of 2.7% in line with estimates, up from 0.2% in the previous update.

AUD/USD Technical Analysis (the 60-min Chart)

Technically, the AUD/USD currency pair appears to be trading within a descending channel formation in the 60-min chart. This indicates a significant short-term bearish bias in the market sentiment.

Therefore, the bears will be looking to extend the current run of declines toward 0.6805 or lower to 0.6775. On the other hand, the bulls will be targeting potential rebounds at about 0.6864 or higher at 0.6894.

AUD/USD Technical Analysis (the Daily Chart)

In the daily chart, the AUD/USD currency pair appears to be trading within a sideways channel formation. This indicates a lack of a clear long-term directional bias in the market sentiment.

Therefore, the bulls will be targeting long-term profits at about 0.6972 or higher at 0.7132. On the other hand, the bears will look to pounce on profits at about 0.6678 or lower at 0.6502.